From the National Association of Realtors:
Metropolitan area / Year over year change in prices
Allentown-Bethlehem-Easton, Pa.-N.J. -10.3 percent
Atlantic City -14.5 percent
New York-Northern New Jersey-Long Island, N.Y., N.J., Pa. -16.3 percent
New York-Wayne-White Plains, N.Y.-N.J. -14.9 percent
Edison -11.2 percent
Newark-Union, N.J.-Pa. -9.7 percent
Philadelphia-Camden-Wilmington, Pa.-N.J.-Del.-Md. -10.5 percent
Trenton-Ewing -20.3 percent
From the APP:
Area home prices continue to decline
The median price for a single-family home in the area that includes Monmouth and Ocean counties declined 11.2 percent in the second quarter, tough news for sellers but a boost to housing affordability, the National Association of Realtors said Wednesday.
…
The median price for a house in Monmouth, Ocean, Middlesex and Somerset counties dropped to $331,700 for the second quarter, down from $373,700, the price during the same period a year earlier, the association said. The median price for a condominium dropped to $254,100, down 6.3 percent.The median price means that half the homes sold for more while the other half sold for less.
…
Other areas of New Jersey saw steep declines as well. The median price for an existing single-family home in the Atlantic City area fell 14.5 percent while in the Trenton area it dropped 20.3 percent, the association said.The median price in Essex, Hunterdon, Morris and Union counties fell 9.7 percent while the area that includes Bergen, Hudson and Passaic counties, as well as New York City, dropped 14.9 percent.
From the Record:
Trade through N.J.’s ports charts a six-month decline
Trade through New Jersey ports plummeted in the first six months of the year, with imports and exports falling by 30 percent as the global economy deteriorated, figures released Wednesday show.
The dollar value of exports from New Jersey fell to $12.8 billion, 30 percent less than in the first half of 2008, federal figures analyzed by the Massachussetts-based World Institute for Strategic Economic Research show.
…
Economists said the national and state export decline was fueled by weakness in the economies of New Jersey’s trading partners, while the shrinking import figures reflect shrunken consumer demand in the U.S. for foreign goods.
“There has been a tremendous collapse in global trade that resulted from the global recession,” said Mark Vitner, senior economist for Wells Fargo Securities, LLC. “The declines that we are experiencing in New Jersey are roughly in line with what we are seeing around the country.”
From the NY Post:
APTS TO RENT: $2B
First it was the banks and automakers that got a helping hand from Uncle Sam — and soon some New York City apartment complexes could get one, too.
A bill winding its way through Congress proposes to prop up deteriorating apartment complexes by injecting $2 billion from the Troubled Asset Relief Program into an effort to stabilize multifamily properties in default or foreclosure.
The bill, which is called the TARP for Main Street Act and was sponsored by House Financial Services Committee Chairman Barney Frank (D-Mass.) and Rep. Nydia Velazquez (D-Brooklyn and Manhattan), would use TARP funds that have been returned by banks and plow it into programs that, according to the bill, would create “sustainable financing” for the complexes as well as provide funding for property rehabilitation.
The House is considering the measure, which focuses on apartment buildings with units that are either rent stabilized or receive government subsidies.
From HousingWire:
ING’s Alt-A RMBS Portfolio Turns 21% Delinquent
ING said delinquencies in Alt-A mortgages underlying its mortgage portfolio increased from 17.2% to 20.9% in the quarter.
…
For the Alt-A mortgages left in the RMBS portfolio, rising unemployment and the continued weakness of the US housing market created “significant impairments,” ING said. It has increased staff to handle loan modifications and restructurings and continues to adhere to strict underwriting policies, it added.
The share of ING’s US loans considered non-performing, or over 90 days past due, rose to 4.1% in Q209, up from 3.7% in Q109. Despite the increase, ING said its mortgage portfolio is performing better than its portfolio of prime adjustable rate mortgages (ARMs), which was 13.7% non-performing at the end of May 2009.
From the WSJ:
Answers Trickle In for Stranded Taylor Bean Customers
Answers trickled in Tuesday for homeowners with loans from shuttered lender Taylor, Bean & Whitaker Mortgage Corp.
But long wait times on phone lines and conflicting responses to questions underscore the broader confusion that prevails among borrowers seeking guidance after privately held Taylor Bean, one of the largest independent home-loan providers in the U.S., abruptly closed its mortgage-lending operation Wednesday.
From the WSJ Developments Blog:
And The ‘Most Affordable’ Metro Is…
Amid the recent chatter about the stabilizing real estate market comes news that median home prices continued to decline during the second quarter, falling 16% from a year earlier to $174,100, according to the National Association of Realtors, which released second quarter data on Wednesday.
Although, prices were up 4% from $167,300 in the first quarter, the increase could also indicate that the mix of homes that are selling is changing, with more expensive homes entering the pool of total sales and very low-priced foreclosures accounting for a smaller share of sales.
Sales were down, too. Total existing-home sales, including single-family and condominium sales, were at a seasonally adjusted annual rate of 4.76 million units in the second quarter, down 2.9% from last year and up 3.8% sequentially.
First-time home-buyers (pushed, in some part, by the $8,000 tax credit) accounted for one-third of all purchasers and distressed homes accounted for 36% of the deals done.
From Bloomberg:
U.S. Foreclosure Filings Set Third Record-High in Five Months
Foreclosure filings in the U.S. climbed to a record for the third time in five months in July as falling home prices and the recession left more homeowners unable to keep up payments or refinance.
A total of 360,149 properties received a default or auction notice or were seized last month, according to data seller RealtyTrac Inc. One in 355 households got a filing, the highest monthly rate in RealtyTrac records dating to January 2005, the Irvine, California-based company said in a statement.
“We’re in a deep hole,” Diane Swonk, chief economist at Chicago-based Mesirow Financial Inc., said in an interview. “There is a whole new wave of foreclosures tied to the cyclical dynamics of the economy.”
Foreclosures increased as the U.S. recorded another 247,000 job losses in July and home prices fell, leaving an increasing number of mortgage holders owing more than their properties were worth. The median price of an existing single-family house dropped 15.6 percent to $174,100 in the second quarter, the most in records dating to 1979, the National Association of Realtors said yesterday. Almost one-quarter of U.S. mortgage holders are underwater, property data firm Zillow.com said Aug. 11.
“There are a slew of factors showing fundamental weakness on the demand side: tighter underwriting, job loss, investors who’ve been badly burned,” said Stuart Gabriel, director of the UCLA Ziman Center for Real Estate in Los Angeles. “We have not seen the bottom of the housing market.”
From the NYT:
U.S. Home Foreclosures Set Another Record In July
U.S. home loans failed at a record pace in July despite ongoing federal and state programs to avoid foreclosures, which have severely strained housing and the economy.
Foreclosure activity jumped 7 percent in July from June and 32 percent from a year earlier as one in every 355 households with a loan got a foreclosure filing, RealtyTrac said on Thursday.
Filings — including notices of default, auction and bank repossession — have escalated with unemployment.
“July marks the third time in the last five months where we’ve seen a new record set for foreclosure activity,” James J. Saccacio, RealtyTrac’s chief executive, said in a statement.
“Despite continued efforts by the federal government and state governments to patch together a safety net for distressed homeowners, we’re seeing significant growth in both the initial notices of default and in the bank repossessions.”
More than 360,000 households with loans drew a foreclosure filing in July, a record dating back to January 2005, when RealtyTrac started tracking monthly activity.
Notices of default, auction or repossession have reached nearly 2.3 million in the first seven months of the year — with more than half a million bank repossessions, the Irvine, California-based company said.
From MarketWatch:
U.S. foreclosures up 7% in July
U.S. foreclosures rose 7% in July compared to the prior month, a 32% rise from July 2008, RealtyTrac said Thursday. “July marks the third time in the last five months where we’ve seen a new record set for foreclosure activity,” noted James J. Saccacio, chief executive officer of RealtyTrac. “Despite continued efforts by the federal government and state governments to patch together a safety net for distressed homeowners, we’re seeing significant growth in both the initial notices of default and in the bank repossessions.”
So i just want to be reminded.
Nobody on this website feels that the prices in Northern NJ will rebound in 09 and possibly not even in 2010…
Is that believed to be a true statement.
12100Atlantic City, NJ 254.8 269.7 253.3 255.9 248.9 229.1 219.1 218.7 Down 19% from 2007 high.
10900Allentown-Bethlehem-Easton, PA-NJ 248.1 260.8 243.6 251.5 245.4 238.0 218.0 225.6
Down 14% from 2007 high
35620New York-Northern New Jersey-Long Island, NY-NJ-PA 469.3 469.7 437.9 454.0 453.0 391.4 372.9 379.8 Down 19% from 2007 high
35620NY: Edison, NJ 387.7 380.3 365.2 373.7 377.3 344.0 320.9 331.7
Down 14.5% from 2006 high
Edison,Long island is up from 1st quarter
Quarterly home prices typically exhibit a seasonal trend, therefore quarter over quarter comparisons could be misleading.
In our area, it is as follows:
Q1-Q2 Up
Q2-Q3 Up
Q3-Q4 Down
Q4-Q1 Down
I believe this is largely due to mix shift over the year.
bergen county holds up, no matter what
Gary says.,,
Wal-mart earnings beat analyst forecast by 3 cents.
Quarterly comparable store sales fell 1.2 percent, excluding fuel. Analysts had expected a rise in comp store sales of 0.85 percent. So they missed that one by 2%.
No big deal. WM shares up in pre-market.
Beating lowered forecasts on earnings and missing on same store sales is the new killin’ it.
•Madoff Had Affair With Ex-Hadassah CFO, Stole Life Savings, Her Book Says
Madoff is the stud
13 – from yesterday:
In Bergen County, personal bankruptcies rose even faster – 63 percent higher in July than a year earlier.
Anyone going to the REDC auction this weekend??
How about a blog get together at the auction?
http://www.auction.com/auction-details.php?auctionID=H-098#;
Grim 2,
You really have to be a desperate landolord to borrow from Timmy G and then be sybject to all of his stings.
I’ll pass.
Retail sales blow it.
4 wk jobless claims up 8500 to 565000. Weekly claims up 4000.
Grim (16):
But it’s different in Bergen County. John told us that Brigadoon was full of rich peole.
Hoboken RE market on fire. 11 UC this week.
http://hudson.fnismls.com/publink/default.aspx?GUID=5cded976-efcd-4f3a-afbc-e2406883cde7&Report=Yes
Frank answer this why would anyone buy a Condo in a town that is 80% transient rentals?
John,
You are always there with an investing lesson. When are you going to give us some of your dancing lessons?
http://www.youtube.com/watch?v=0GnyMfMasJI
#23,
I don’t why, all I know that people do. Look at the rip-off prices.
Where’s the recession??
Mish, slurping the joy juice again:
Social Safety Nets Mask Deflationary Depression
“Prechter is looking for a “major economic depression”. I think it is clear we are already in one.
The only reason it is not more readily visible is people are living in foreclosed houses unable or unwilling to pay their mortgage, one in nine living in the US is on food stamps, and unemployment insurance has been extended twice. Congress is now debating extending it a third time.
If Congress does not act 500,000 Will Exhaust Unemployment Benefits by September, 1.5 Million by Year-end.
Although the official unememployment rate is a mere 9.5% alternative measures show it is over 16%. Moreover, an unprecedented 4.4 million workers have been unemployed and looking for work for 26 weeks or longer. Please see Jobs Contract 19th Straight Month and US Payrolls Less Than Meets The Eye for details about jobs.
In simple terms, more social safety nets are in place now than during the great depression.”
http://globaleconomicanalysis.blogspot.com/2009/08/prechter-sees-major-deflationary.html
New jobless claims rise unexpectedly to 558K
http://finance.yahoo.com/news/New-jobless-claims-rise-apf-1948834182.html?x=0&sec=topStories&pos=main&asset=&ccode=
NJdroppingtheball says:
Nobody on this website feels that the prices in Northern NJ will rebound in 09 and possibly not even in 2010…
Why would you believe they will rebound? What evidence or infomration can you offer that would support that?
Come on X,
Northern Jersey collects the most talented, good looking, and wealthy people from around the world.
Retail sales down in July. The solution? Declare the recession is over and say that NOW is the time to buy a new house before it’s too late!!!!!
“Retail sales down in July.”
What we obviously now need is a new government program called “Cash for Everything.”
Or better yet, “Sock it to your Offspring!”
http://www.nytimes.com/2009/08/13/business/economy/13fed.html?ref=us
This article in the NYTimes starts
Almost exactly two years after it embarked on what was the biggest financial rescue in American history, the Federal Reserve said on Wednesday…
Did I miss a year? I know it seems like a long time ago, but it was only a year ago, wasn’t it?
Ray – two years – In August 2007 liquidity abruptly dried up in the Shadow Banking System. And who can forget the run on Northern Rock Bank in England in Sept of 07?
#32
Ray, I read that this morning and was thinking the same thing…?
CNBC.com Mad Libs
Jobless claims rose unexpectedly to ….. (number) last week. Sales at US retailers fell in ….. (month) from ….. (previous month) by …. (number) percent.
One bright spot was in ….. (consumer product) where sales rose more than expected thanks to the governments Cash-For- …… (aforementioned consumer product) program that gives consumers cash to swap their possessions for green, khaki, ….. (color) and other environmentally friendly colored goods. Excluding the government incentives, sales actually fell 26% in the category ….. (time period) over …… (time period).
In other news, the Fed hinted at an improving economy, while saying that inflation would remain subdued and interest rates would remain low for an extended period.
The S&P 500 rose ….. (number) points based on the Fed’s statement.
CIT Adopts Tax Benefits Preservation Plan to Protect Tax Assets and Enters into Written Agreement with the Federal Reserve
NEW YORK–(BUSINESS WIRE)–CIT Group Inc. (NYSE: CIT), a leading provider of financing to small businesses and middle market companies, today announced that the Company’s Board of Directors has adopted a Tax Benefits Preservation Plan (the “Rights Plan”).
While the Rights Plan will not impede the Company’s ability to pursue restructuring or strategic opportunities, it is designed to protect the Company’s ability to utilize its net operating losses and other tax assets, preserving value for the benefit of all stakeholders. This value could be reduced if the Company experiences an “ownership change” under U.S. federal income tax rules, which occurs if one or more “5% shareholders” (as defined under U.S. federal income tax laws) have aggregate increases of 50% in their CIT ownership over a three year historic period. The Rights Plan reduces the likelihood that CIT experiences such an ownership change by discouraging any person or group from becoming a “5% shareholder.”
In addition, the Company announced that on August 12, 2009, it entered into a Written Agreement (the “Agreement”) with the Federal Reserve Bank of New York (the “FRB”), the principal regulator for its bank holding company. The Agreement requires regular reporting to the FRB, as well as the submission of plans and certain restrictions related to corporate governance, credit practices, capital and liquidity and the Company’s businesses. The Agreement also requires prior written approval related to the payment of dividends and distributions, incurrence of debt, and the purchase or redemption of stock.
Details of the Tax Benefits Preservation Plan and Written Agreement will be filed with the SEC in a Form 8-K that will be accessible in the Investor Relations section of the Company’s web site at http://ir.cit.com and on the EDGAR section of the SEC’s website at http://www.sec.gov.
In York, PA today. What a craphole. Nice minor league baseball stadium though. Site of the only place that I ever caught a foul ball.
Seneca,
You missed one sentence.
Last months …..(number) was revised upwards to make the drop in this months number appear better.
Dissident HEHEHE says:
Northern Jersey collects the most talented, good looking, and wealthy people from around the world.
Yep, you see that every summer weekend on the Point Pleasant boardwalk
Home Price Declines Accelerate in Second Quarter
Aug. 12 (Bloomberg) — Home price declines in the U.S. accelerated in the second quarter, dropping by a record 15.6 percent from a year earlier, as foreclosures weighed on values.
The median price of an existing single-family home dropped to $174,100, the most in records dating to 1979, the National Association of Realtors said today. Total sales rose 3.8 percent to a seasonally adjusted annual rate of 4.76 million from the first quarter and fell 2.9 percent from 2008’s second quarter.
The median existing home price fell 9.7 percent in the Northeast from the same period a year earlier to $246,000, the group said. Sales jumped 15 percent from the first quarter and are down 8.4 percent from a year ago.
The world’s largest economy will contract 1.3 percent this year, according to a July 10 forecast by Fannie Mae. The U.S. unemployment rate may climb to 9.9 percent in 2010, from 9.3 percent this year, according to the mortgage buyer controlled by the U.S. government.
Stu, good catch. I honestly think this is how the “journalists” at CNBC write their drivel.
And for what its worth, the Fed’s improving economy statement was lifted word for word from this morning’s lead article.
Can we start a “Sea Of Wealth” (SOW)count.
Every time another poster throws out the old SOW exscuse, the official counter goes up one.
Talking about SOW’s hows dubai doing? the land of gold plated urinals and oil sheiks driving silver audi’s (not silver paint, but SILVER metal body panels!)
http://lh3.google.com/fisherwy/RvjUlYpBG3I/AAAAAAAAI6M/YMqMEBr5TC8/Audi%20A8%20in%20Silver%20Made%20for%20a%20Sheikh%20of%20Dubai2%5B5%5D.jpg
Clot,
you and all the other doomers need to relax
47 economists in a Wall Street Journal survey, and 53 in a Bloomberg one, say the recovery is here and the recession is over.
Oh, and can we take these economists names and have them banned from the field when the economy “unexpectedly” deteriorates despite their predictions?!
“47 economists in a Wall Street Journal survey, and 53 in a Bloomberg one, say the recovery is here and the recession is over.”
Is that 47 out of 50, or 47 out of 500?
Regarding shadow inventory
from Elizabeth Warren
* The banks are still insolvent.
* That little tweak to ark-to-market accounting a couple of months ago has allowed us all to plunge into deep denial.
* Now that the banks are allowed to lie about what their toxic assets are worth, they’ll never sell them (because if they did they would have to write them down).
* The smaller banks are undercapitalized and will have to raise another $12-$14 billion.
This could turn into some epic fail!, the banks will sit on these proerties and let them rot (literlly). This will ultimatly hurt towns and neigborhoods more then help them. Having an empty rotting home sit in a niegborhood until t fiinally gets ton down is worse then selling at a cut rate in terms of cumulative effects on the people living there.
The banks will also ultimatly do better selling while the homes are still viable. Except of course timmy will be sure to TAR the banks for the stated values of the homes, which will then become the stated value of the vacant lot after the home gets demolished.
And the towns counting on tax revenue….. HAHAHA
Link to elizabeth warren comments
http://www.businessinsider.com/henry-blodget-elizabeth-warren-we-have-a-real-problem-coming-2009-8
From RealtyTrac 8/13/09:
Other states with totals among the 10 highest in the country were Texas (12,077), Georgia (11,136), Ohio (11,021), Michigan (8,257) and New Jersey (6,467).
maybe those economists should take a look at this and explain how exactly we are bottoming.
http://www.voxeu.org/index.php?q=node/3421&ref=patrick.net
Must be the SOW effect….
Link:
http://www.realtytrac.com/ContentManagement/PressRelease.aspx?channelid=9&ItemID=7192
Sean,
Did “Rescue” efforts started 2 years ago? TARP is just a year old, right?
Man, when you get old…I do remember what I had for breakfast though. Everything bagel with butter, coffee. Or was that 2 years ago?
Kettle, I agree with what she is saying, banks are avoiding foreclosure and selling the assets at all cost to continue to LIE about the value of their assets. The government needs to force action, not pretends everything is fine. Mark to magic is a farce and the banks should engage in loss mitigation not deception. When the ball drops it really could be that much worse.
If the recession is over, that would be AWSESOME. What would be even more AWESOME is if people stopped overpaying for houses based on what other people paid 5-6 years ago, which caused a market meltdown.
Between the bank’s fantasy accounting; world governments fudging everything from GDP to unemployment to export figures; and the continuous delay of businesses and asset owners to recognize losses; I can safely say this recession is over if it even existed in the first place. Long live the house of cards.
Can one of you realtor types decipher this statement on a foreclosed house we were going to look at. Specifically the buyer’s premium portion. I want to know if it is even worth it to look.
Corp. owned sold strictly as is purchaser is responsible for C.O Smoke Cert and All Inspections Property is in auction status all offers are subject to 5% buyers premium
“Plan C”? ….this is very disturbing.
http://www.mybudget360.com/the-doctrine-of-preemptive-bailouts-and-the-biggest-bailout-you-havent-heard-about-the-us-treasury-plan-c-and-the-35-trillion-you-will-be-paying/
I think I’m finished paying taxes
Doyle,
It was only a year ago that the Fed pushed through the rescue, so I guess it only took them a year to do something.
Now that the banks are allowed to lie about what their toxic assets are worth, they’ll never sell them (because if they did they would have to write them down).
In foreclosure REO,bank write off losses.What they don’t write off is mark to market value of assets(homes)that went down in price,wich they dont know actual value that can go up in value in the future.
They mark assets that are not on their posession anymore.That they know the value how much they own the asset and sold it for.
Funny office IT mishap. Y’all know that the Bobs from McKinsey are crawling around here looking for ways to make us more efficient. Well apparently we are in the process of doing an upgrade on PeopleSoft HR. Yesterday they decided to test the process for terminating employees in the system. Well apparently the test system spit off emails to the employees whose records were used in the test. Don’t know the exact wording of the email, but they basically said you were terminated as of a certain date. Paranoid freakouts ensue. Am surprised this did not make Gawker yet.
SS
Plan C, the plan that dislocates the bond market?
another 3.5 trillion in borrowing on top of obama’s trillion dollar deficits and dropping tax revenue…… yeehaw
53 – buyers premium means that you pay an additional 5% of the purchase price to the auction house. its not a real estate term its an auction term.
Gator that stuff happens with peoplesoft all the time. My wife is former HR recruiting partner. Hated PS, commonly referred to as Piece $hit, for the awful Indian outsourced code in HR circles.
We just had a new version of TPS reports here in my 7 circle of corporate hell and we are not getting bonuses or wage increases this year despite posting a profit. Happy Day. What recession?
yome 56
these banks have enough super genius quants to have a rough idea of what the homes may currently be worth and what they may be worth 2,5,10 years from now.
keeping the foreclosed 3 bdrm/2 bath POS cape on a .1 acre lot facing a major road, on the books for 700K is BS.
It doesnt take a super genius quant to know that the POS is not worth 700K.
if the banks did anything even resembling mark to market, the majority of them would be insolvent over night (as they should be)
Thanks ruggles guess my offer just got 5% lower if we like it.
Edmund Andrews, the author of the NYT’s article wrote me back and said
The crisis began two years ago, not with Lehman but the financial market
meltdown in August 2007. The Fed’s first emergency response that same month
was to expand lending through the discount window.
I have been officially corrected. He was very nice about it. He could have said – Nah nah nah nah nah, get a calendar
“if the banks did anything even resembling mark to market, the majority of them would be insolvent over night (as they should be)”
Funny, most of us here knew all the banks were looking at insolvency back in late 2006.
When this house of cards falls, the pile is gonna be really thick.
August 13, 2009 at 10:30 am
Sean,
Did “Rescue” efforts started 2 years ago? TARP is just a year old, right?
Man, when you get old…I do remember what I had for breakfast though. Everything bagel with butter, coffee. Or was that 2 years ago?
It started before TARP. Look at a 5-yr trace of GLD, and see when that picked up off its 2-year plateau; that’s when the fed turned on the printing press. Spot price is up $300 since.
BTW, I just heard Congress ordered more heavy-lift helicopters – no word on whther they’re going to the Pentagon or the Fed…
Frank-,
You mean these Hoboken transactions?
More Info 01/19/07 8123 155 $834165 1500 WASHINGTON ST #7Fjust closed last week for $715,000 mls 80001597.2 years 115k loss not including transaction costs. Posted on: 2009/8/12 14:46 Re: recent sales in Hoboken#2 Anonymous 71 jefferson #4 mls 90003484 closed last week for 585kMore Info 11/21/05 7762 348 625000 40 k below 2005 pricing Posted on: 2009/8/12 14:51 Re: recent sales in Hoboken#3 Anonymous 409 fourth #3 sold for 415k. nice little unit.two identiucal units sold for 500k+/- in 2007Sale Date: 11/21/07 Book: 8381 Page: 169 Price: 518000 sale date: 09/01/07 8336 159 498500 6 34.44 409 FOURTH STREET
On bberrry so cut and paste may be a bit off
“helicopters – no word on whther theyre going to the Pentagon or the Fed”
I thought they were going to MS to help spirit the bonuses out of the country.
Interesting comment on the Plan C article…
“The American public has not come to terms with the reckless spending and mandated social changes to our society because they are not paying for it yet. The average joe doesn’t pay anymore than he used to in taxes or bills towards the payment of this reckless and criminal in my opinion behavior this administration is placing on peoples futures and their childrens futures… NO IDEA!!! Most people don’t pay attention until it affects them, and then they awake. By printing and borrowing money this administration has kept the general public and even the business area as well away from the feeling of the hit they will ultimately take. That is until now…
People and more importantly small businesses are starting to add it all up. They are not buying the hype any longer and are realizing that they were sold a bill of rotten goods. When the amasses awake it is really tough to place them back into a slumber. A $600 / $1200 check won’t work, and don’t dear try another stimulas if this takes hold.”
if the banks did anything even resembling mark to market, the majority of them would be insolvent over night (as they should be.
That is the problem,you are looking for a financial catastrophy and the gubmint is trying to solve it(I think anyway).The great depression got worst due to inaction.It got better when they got away from the gold peg.
Do we want another great depression?You are right,it will not be easy paying for all this bailout but there is no other choice.Burn inside or jump out.Jumping out probably gives a 30% chance.The burn will heal.
Did U ever try to get forclosures on Bloomberg , type REDQ to get delinquency and foreclosure data graphed by region.
“When this house of cards falls, the pile is gonna be really thick”
Walking the beach this morning we had a similar discusion. I don’t know about anyone else but sometimes I feel like the only sober person in a room of drunks (or, maybe, sane person in a room of folks who are , um, less-attached to sanity). Unemployment is what it is, people drop off the rolls because there is no work for them, savins is up only because of writeoffs and government reaching into Nom’s pockets (thank you Nom), consumer spending increases because of heating and transportation fuel increases,yadda, yadda, and people see this as a good sign.
Meanwhile, I keep waiting for the thud (crash?) of the other shoe falling and wondering if I am Chicken Little or just realistic.
Shore 67,
thats what the C-5 Galaxy’s are for….
with a payload of 118,387kg thats about 4 billion in gold bullion.And with a range of about 5,000 KM the sky’s the limit
Did you see my post on Sudan yesterday???
Stu,
the scary thing is that the government is trying to step in and shield the banks. In so doing they have transfered the risk, from the banks to the government. the pile of corpses will not be just banks. It will contain a substantial number of taxpayers and potentially substantial portions of the US government.
After all this is set and done this great country will be like a 3rd world but the sun will still shine the next day.The rich will get richer and the poor will get poorer.The shining armour is there no more.
Because of not much choice.The only good thing is,This is a world wide event.The poor in africa,asia will still be poor.
Yome,
you might want to brush up on the economic behind the GD. It wasnt inaction that was the problem…..
It was in some part unavoidable as the market had become highly leveraged during the roaring 20’s. Consumer debt in the late 20’s went through the roof.
Very similar to today’s mess.
there are 2 general options in such a mess, clear the bad debt fast and hard in a painful correction, or drag out the deleveraging and make the process slow long and painful. Politicians want the slow drawn ot process which is the least efficient economically, but the least painful to any one group of politicians.
the core issues in 1929 were not significantly different then in 2007 or in 1873. You are seeing the cyclic mania that takes place and the subsequent deleveraging that must occur. The danger is in governments trying to prevent deleveraging. Its not possible, and has never been done. All i does is transfer wealth from the mass to the few privileged who have government connections and can get bailed out.
Maybe its not so different here?
Krugman Buys Manhattan Apartment for $1.7 Million (Update2)
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aM6QtJEQRJCI
Aug. 12 (Bloomberg) — Princeton University Economist and New York Times columnist Paul Krugman bought an apartment on Manhattan’s Upper West Side for $1.7 million. It was on the market for more than a year.
Krugman, a winner of the Nobel Prize, purchased a co- operative on Riverside Drive. It was originally listed for $1.85 million, according to StreetEasy.com, a property listing service. The purchase was recorded today, according to the New York City Department of Finance Web site.
Manhattan apartment prices dropped for the first time since 2002 in the second quarter as the collapse of Lehman Brothers Holdings Inc. and Bear Stearns Cos. caught up to property owners in the nation’s most expensive urban market. Krugman said this week that the deepest economic slump since the Great Depression may be ending.
“It’s quite possible, though not certain, that retrospectively, we’ll say that the recession ended in July or August, maybe September,” Krugman said in an interview from Kuala Lumpur. “My guess is that we’ve bottomed out now, that August was probably the trough month.”
Barbara Monteiro, a spokeswoman for Krugman, confirmed the transaction and said he was unavailable to comment today.
‘Classic Six’
Krugman’s apartment was listed for 402 days, according to StreetEasy. It has six rooms, including three bedrooms and two bathrooms. It’s described as a “spacious, sunny, quiet Riverside Drive Classic 6 in a fine pre-war building,” with nine-foot ceilings and a “romantic cityscape” view, according to StreetEasy.
“We really wanted a place that has the ultimate New York luxury, which is a washer and dryer,” Krugman told the New York Observer in an interview.
Krugman said he thinks Manhattan prices will continue to decline.
“Yes, I do expect New York prices might fall some more, but we need a place. And I came into some money,” he said.
The seller is listed as Joseph B. Treaster, who is a former New York Times writer. Krugman said he doesn’t know Treaster.
The apartment has monthly maintenance charges of $1,820. The building has a doorman, elevator and laundry room.
The median price in Manhattan fell 18.5 percent from a year earlier to $835,700, New York appraiser Miller Samuel Inc. and broker Prudential Douglas Elliman Real Estate said on July 2. The number of sales plunged by half, the most since Miller Samuel began keeping data in 1989.
Krugman made his purchase amid signs that the national housing slump is stabilizing. Total existing home sales rose 3.8 percent in the second quarter to a seasonally adjusted annual rate of 4.76 million from the first quarter, the National Association of Realtors said today in a statement.
I am on vacation, but all this happy talk reminds me that I still need more .223 rounds, and should start to lay in some beermaking supplies before there is a run on that too (or a 2000% fed tax, like they did with RYO tobacco).
Shore Guy (71):
You are not alone!
Keep in mind, the majority of your peers also finds ‘Deal or No Deal’ stimulating as they have burnt out from watching 30 years worth of the ‘Price is Right.’
I think this country is spoiled. The only way to change a spoiled person is to stop giving them everything they want. I truly think this is about to happen and the Paulson’s and the Geithner’s are simply making sure that the ruling class will be best positioned to be the last ones standing.
“Yes, I do expect New York prices might fall some more, but we need a place. And I came into some money,” he said.
Guess all we need is more Nobel prize winners buying NYC apartments and all RE troubles will be fixed!
Yome 74
The only good thing is,This is a world wide event.The poor in africa,asia will still be poor.
you miss the significance of that statement. Going from poor to slightly more poor is little change for someone in that environment. Going from the highest level of consumption in the world, consuming at levels unheard of throughout history, to a sustainable level is like falling off of a cliff for most americans.
The average poor american is better off that a significant portion of the 3rd world population. going from a middle class consumer with the escalade and Mcmansion to food stamps and and unemployment is a very big fall relative to the world that most americans live in. Even if they are still technically better off then a large chunk of the worlds population
“The only good thing is,This is a world wide event.The poor in africa,asia will still be poor.”
But they don’t have guns. America is gonna be a fun place when suburbs become the ghetto. Our lax gun laws will sure make this interesting when someone who used to drive a Lexus must now take the bus.
there are 2 general options in such a mess, clear the bad debt fast and hard in a painful correction.
The GD.We all know what happened to that.
or drag out the deleveraging and make the process slow long and painful. Politicians want the slow drawn ot process which is the least efficient economically, but the least painful to any one group of politicians
This was never tried.We can only assume the consequences.
I agree with the crisis guide but not with a fight.
I think at that point you have to worry about them taking the Lexus from someone else. Judgement Night every time you take a wrong turn.
Kind of reminds me of a friends experience at RU Camden law. After sun down, stop signs are optional.
Stu says:
August 13, 2009 at 11:35 am
“The only good thing is,This is a world wide event.The poor in africa,asia will still be poor.”
But they don’t have guns. America is gonna be a fun place when suburbs become the ghetto. Our lax gun laws will sure make this interesting when someone who used to drive a Lexus must now take the bus.
Go back to #74.There is no way out from that anymore.Either its your 1st option give up without a fight or 2nd option.Either way its no lexus for the middle class anymore.Rich and Poor just like the whole world.
Shore 71
Welcome to the parallel universe that some of us live in. Apparently the “many worlds” interpretation of quantum mechanics was correct ;)
Yome
It might actually be possible to avoid such a fate by abandoning globalism and returning to regionalism.
It would have some interesting consequences but the consequences of the CAP&Trade schemes being discussed could actually put us there.
I can’t believe we have come complete circle on the Band-Aid debate.
We have not even begun to feel the effects of our decision. The repercussions might last fifty years or they could end the USA as we know it. Worst of all, the moral hazard in all of these bailouts have become completely ignored. Wall Street is already gearing up to do it again and commercial REITs are moving up with the expectation of the 3 trillion bailout.
We have not paid one bloody cent for this yet. See if your opinion changes when you are eating cat food to pay for the criminal behavior that enriched the Wall Street financial alchemists. No one in the Roman Senate died poor.
stu 87
what band-aide circle are you referring to?
What collateral does china,japan germany have against the bond paper they are holding?We still have the bomb.
Germany,russia’s debth were forgiven.
Pain 60 – I feel your pain. We had a “holy crap we’re losinG tons of money” wage freeze implemented with no advance planning. The only folks who got raises this year were people who happened to have an anniversary date prior to mid-Feb. If your anniversary date was any later, you got 0, not matter what your performance was. And let’s just say some of those who got raises were not exactly the shining stars of our department. How’s that for staff morale?
And re PeopleSoft, try using custom PeopleSoft apps – even worse because you’re trying to use the POS for something it wasn’t even designed to do. We worked with consultants on building this system (while putting people out of work) 7 years ago, and I still get shudders just thinking about it.
The Band-Aid analogy for how to handle the crisis. Either you rip off the bandage quickly and suffer shooting pain that dissipates quickly. Or you slowly pull of the bandage, enduring less pain, but for a much longer period of time.
Personally, I prefer the bikini wax method.
Oh well back to wiping b*tts.
Stu,
No offense but, the thought of you getting a bikini wax is too much to handle this early in the day.
Gator,
Are you in HR?
Kettle,
Indeed, we all seem to be accidents of vibrating strings.
Ket,
I missed Sudan yesterday. What is the word.
Interesting thing, a government in the HOA has asked me to come over a few times for some conversations related to one of my businesses; however, I have little inclination to get that close to al Shabab.
Shore:
kettle1 says:
August 12, 2009 at 11:21 am
Shore:
OT but is this on your radar at all?
A senior politician in South Sudan says the south will declare independence if it does not get a fair referendum on the issue
http://news.bbc.co.uk/2/hi/africa/8195973.stm
South Sudan has noticeable reserves of both oil and phosphates. 2 of the more valuable resources. It seems north Sudan would be hosed if the south breaks away and it is left without any high value natural resources. This has to be carrying some interesting political back games with the regional political powers, especially given the christian south / muslim north division
Stu,
the bandaid analogy is indeed grossly over simplified, but for a blog debate it is useful.
#77:
my advice is to go all grain and skip the malt extract. Had to buy beer recently: It has been so long since I had to and was surprised by how expensive it has become. Sin tax my ass. . . . homebrewing is where it is at.
Corrados in Paterson is good homebrewb shop if you need supplies.
North country malt in upstate NY is a great place to buy bulk grains.
must learn to proofread.
Homebrewb
Could be a good name for your product!
Just saw a bunch of people who are visiting the University today for a Chemistry symposium. The job market for chemists (pharma, energy, personal care, etc…) in this state is getting ugly. Aside from the mass layoffs resulting from the mergers with Wyett/Pfizer, Merck/Shering, Squibb along with companies like Church & Dwight fleeing for PA, they said they typically interview 70 people for each opening they have, and openings are rare. The local economy in NJ is in shambles. Trenton better get their act together quickly because it’s only a matter of time before the rest of our industries flees the state.
Kettle1:
“grossly over simplified”
Usually the most obvious solutions to huge problems tend to be very simple. The finer details often provide little more than noise which gets in the way.
I can’t even begin to tell you how many problems I’ve helped solve in the workplace by forcing the solution seeker to reexplain the problem in 10 words or less. Way to often, the details cloud the solution seekers root cause.
Shore Guy 93/94 – Not in HR. And regarding Stu’s analogy, at least it wasn’t a Brazilian.
Gator,
I think that particular type of wax sounds like something a wife does to a husband when he has really p!$$ed her off.
Take that! you insensitive guy you.
Gator (104):
“at least it wasn’t a Brazilian.”
http://tinyurl.com/WaxingPoetic
if yougo to corrados take a hand gun
Ben,
Now, you know that’s not going to happen.
Butter on your popcorn?
Ket,
The short piece you posted hits on all the key points. I have not been payinc close attention to Sudan but, if it were to break apart, it would seem to provide just one more opportunity for groups like al Shabab to “ride to the rescue” and cause no end of trouble. I would pay attention to the size of our detachment in Djibouti, which has responsibility as a quick-reaction force for all of Africa (and which itself has been targeted by Shabab).
Shore – I liken it to Rita Rudner’s old schtick on childbirth. If I’m going to go through all that, he’s going to be lying on the table next to me, at least getting his legs waxed.
“the bandaid analogy is indeed grossly over simplified, but for a blog debate it is useful.”
Kettle, not neccessarily. For areas along the West coast that saw the biggest amount of foreclosures coupled with the largest declines in price (~70% off peak), their sales levels in the 4th quarter of 2008 actually eclipsed the sales levels seen in 2004/2005, the height of bubble mania. Keep in mind, this is despite the fact that the banking system imploded. The end result is, every one of those houses are now filled with people who can pay mortgages rather than becoming a ghost town. Meanwhile, in areas where we are now trying to prop up prices or reduce the speed of the decline, we get homes sitting empty on the market rotting for over a year.
Had we not even lowered rates in 2007 and injected liquidity, the price declines would have been fast and hard. The collapse of Wall St. would have easily arrived a full year earlier. If we allowed that to happen and skipped the whole bailout hoopla, we probably would have seen a temporary 15% rate of unemployment and a simple cut in a trillion dollars of wasteful overseas spending would have us in a growing economy today.
Instead, the slow approach has left us with 10% unemployment, a handful of incompetent Wall St. banks that now have greater market share (oligopoly), a bigger federal government, more debt, and sometime in the next year or two, double digit inflation.
Every major economic panic in the history of the world that was responded to with a decrease in government spending and bank failures resulted in solid economic growth/recovery within 2-3 years. That’s why Germany and Japan became the two strongest economies in their respective regions after WW2. They weren’t allowed to waste money on military spending.
Stu
I thought you agreed not to show that pic of me to anyone
Ben
sorry if I am slow today, but I believe that we are agreeing on the matter.
Letting the system self correct while the gov does no more then provide a basic social safety net (medical care/ foodstamps, etc) is the best route
I thought the recession was over, what the heck are you guys talking about. I need a cold one on the train.
Their is a buyers stampede in the bond and equity market right now. The folks who got out got to get back in. Of course those folks are bad market timers. But nevertheless when folks get their 3Q 401k statements for once they are going to open them and smile. People are raising their 401K contributions, bonuses will be at 2007 levels, cars are cheap, vacations are cheap. Even electricity crashed to earth the last few weeks. Sorry folks, we may have another crash anyday now but tonight drink the good stuff and go to Peter Lugars and spend some of that money you made trading.
Kettle1,
I actually thought it looked a bit more like Gary.
90-My observation is that they don’t give a darn about employee morale anymore. They think you should just be grateful that you get a paycheck. Come to work, be on time, do your work,don’t waste time, go home, repeat.
John,
You are among the tiny group that is benefiting. That’s the Wall Street group.
Most of us no longer contribute to our 401K as the match has been removed. I’m going on 22 months without a salary increase. Bonus? Most of us never get one.
Want to talk deflation? Somehow I’m paying more every year for health care. God forbid I overdraw my bank account or fail to pay my credit card in full.
See in the real world John, where your tax dollars have gone to supplement the bonuses of you and your friends, deflation hasn’t come. All that has occurred is another huge increase in the income gap thanks to your buddies at the helm.
As much as everyone would like to think the worst is over, we are still far away from that point. The economy got an artificial boost from the cash for clunkers program. But that is done. The recession still needs to run its natural course. Unemployment is expected to go over 10%. That is still the number 1 factor in buying a home. A second artificial boost because of the federal credit is almost over as well. Finally, all the buyers who wanted to have their kids in school for the new year are through. You put those 3 things together that are now coming out of the market, and we are still going to see further declines because of a lack of buyers. The Fed could help by lowering rates.
#42
They are the same 47 and 53 that said housing prices would continue to rise, there was no end in sight in 2007.
I recently watched this one clip from 2007 where peter schiff was laughed off cbnc for saying a housing collapse was coming.
Truly Sad news;
Guitar legend-inventor Les Paul dies at age 94
John,
“Today, the Commerce Department reported that total retail sales declined -0.1% in July, a very significant disappointment, considering that economists had been predicting an increase of 0.8%. Readers should also note that the decline in July comes on the heels of a revised gain in June of 0.8%.
Sales excluding autos and auto parts also registered an unexpected decline of -0.6%, compared to a revised 0.5% increase in the measure in June. Economists had forecast a gain of 0.1% in July sales, excluding auto purchases.”
So far, the only economic indicators that have improved have been via government intervention a la cash for clunkers. Of course borrowing from the future is fine if their is some impetus for growth in the future. I personally see nothing better coming down the road except for a slight pulse of replenishing smaller and smaller inventories.
Glad to see our NJ Politicians are concentrating on the important issues:
After Nets ditch ‘NJ’ on uniforms, lawmakers praise Devils for staying loyal to New Jersey
As State Sen. Kevin O’Toole (R-Cedar Grove) prepares to introduce legislation that will stop professional sports teams who don’t use New Jersey on their uniforms from receiving any public dollars, two key lawmakers today praised the New Jersey Devils for their state pride.
“The New Jersey Devils are a class organization who have made our great state their home. And we share in the pride that the words ‘New Jersey’ represents in their name,” said State Sen. Joseph Vitale (D-Woodbridge).
Teams that play in New Jersey and don’t use “NJ” on their uniforms are beginning to face criticism from public officials. Earlier this week, O’Toole slammed the Nets for their decision to remove “NJ” from their team uniforms while on the road.
Vitale is objecting to a super-sized “NY” that appears on the side of a Meadowlands office building that a state agency built for the Giants.
“It is my hope that the New Jersey Sports & Exposition Authority will feel that same level of pride and recognition that we all do by removing the ‘NY’ logo from a building that real New Jerseyans have mostly paid for,” Vitale told PolitickerNJ.com.
Last year, Assembly Majority Conference Leader Joan Quigley (D-Jersey City) strongly objected when the NY/NJ Metro Stars changed their team name to Red Bull New York after taxpayers helped the soccer franchise finance a $165 million stadium in Harrison.
“I’ve got to hand it to the Devils for not only making New Jersey home, but doing it with pride as other teams have kicked New Jersey around, even as they benefited from support from New Jersey fans and taxpayers,” Quigley said.
But Gov. Jon Corzine said he is unlikely to support legislation to tie state funding to team uniforms.
“It would be an overreaction for us to demand that they put the logos on their jerseys. Would there be an advertising value for us if they put ‘New Jersey’ on their jerseys? Yes,” Corzine told PolitickerNJ.com.
Another legislator, Assemblyman Michael Doherty (R-Oxford) says that he opposes the use of public funds to subsidize any professional sports teams, no matter what.
“I hope the Nets stay in New Jersey and we should not use any tax dollars to support professional sports teams regardless of whether they use New Jersey of their logo or not,” said Doherty.
Dr. James W. Hughes, dean of the Edward J. Bloustein School of Planning and Public Policy, said team uniforms can help boost the economy of a team’s home state, although he said he did not know by how much.
http://www.politickernj.com/editor/32240/after-nets-ditch-nj-uniforms-lawmakers-praise-devils-staying-loyal-new-jersey
Seen five things today that convince me the day of reckoning is nigh.
Bill,
the cash for clunkers deal was a joke. All it did was pull future demand into the present. This is no different then how the Credit bubble was inflated from 2000 – 07. They pulled people future incomes into the present to generate consumption. Guess what, the deficit that creates generates a net loss as the future consumption/income is often more less valuable in the present then if you left it in the future.
correction
Guess what, the deficit that creates generates a net loss as the future consumption/income is often more less valuable in the present then if you left it in the future.
lets try again:
Guess what, the deficit that creates generates a net loss as the future consumption/income is often
moreless valuable in the present then if you left it in the future.116 House Whine – Agreed. At this point, poor morale is probably being encouraged here, since if folks get unhappy enough to leave (assuming there are jobs to be found), that’s less severance packages to pay out after the Bobs make thir final recommendations.
I didn’t get a nickel from uncle sam or a bail out. I did take advantage of the fact the companies uncle sam was bailing out were not going under and invested. That anyone could have done. Back in March there was literally people running up and down the street yelling free money and most people said no thank you, now that the free money is gone they are mad they did not get any. What the heck is a raise, I sure don’t get one. You are being rewarded slowly based on tenure, fuggetabout it. People looking at houses now are feeling better about their 2010 bonus and their bond and stock accounts are up. Problem is easy money is spent easily and that may drive up home prices in itself. The sad part is I know people who in a panic moved to cash near bottom of market and recently got back into stocks, too late to catch the run up and they risk getting burned again.
Stu says:
August 13, 2009 at 1:06 pm
John,
You are among the tiny group that is benefiting. That’s the Wall Street group.
Most of us no longer contribute to our 401K as the match has been removed. I’m going on 22 months without a salary increase. Bonus? Most of us never get one.
Want to talk deflation? Somehow I’m paying more every year for health care. God forbid I overdraw my bank account or fail to pay my credit card in full.
See in the real world John, where your tax dollars have gone to supplement the bonuses of you and your friends, deflation hasn’t come. All that has occurred is another huge increase in the income gap thanks to your buddies at the helm.
Wow Walmart and Sears may have to lay off a few sales clerks, I guess they won’t be able to buy new jet skis and micmansions.
Stu says:
August 13, 2009 at 1:13 pm
John,
“Today, the Commerce Department reported that total retail sales declined -0.1% in July, a very significant disappointment, considering that economists had been predicting an increase of 0.8%. Readers should also note that the decline in July comes on the heels of a revised gain in June of 0.8%.
Sales excluding autos and auto parts also registered an unexpected decline of -0.6%, compared to a revised 0.5% increase in the measure in June. Economists had forecast a gain of 0.1% in July sales, excluding auto purchases.”
So far, the only economic indicators that have improved have been via government intervention a la cash for clunkers. Of course borrowing from the future is fine if their is some impetus for growth in the future. I personally see nothing better coming down the road except for a slight pulse of replenishing smaller and smaller inventories.
Happy News on the GSE front
Let’s start with Fannie Mae, the government-sponsored enterprise that was allowed to function as a quasi-private company from 1968 to 2008 and is currently under conservatorship of the Federal Housing Finance Agency. Prior to conservatorship, Fannie earned a profit two ways. First, it used borrowed funds to purchase mortgages that it held directly. Because investors perceived the GSE’s debt to be implicitly backed by the federal government, Fannie’s borrowing costs were very low, and it had an incentive to engage in arbitrage on a huge scale, borrowing cheap and buying as many mortgages as regulators would allow. As of June 2009 these assets came to $793 billion. Second, Fannie would bundle mortgages into securities on which it provided a guarantee of timely payment of principal and interest, in exchange for which it received a modest fee, and assumed a staggering off-balance-sheet liability. As of June 2009, Fannie’s guarantees involved an additional notional liability of $2.4 trillion. Fannie’s equity was never remotely sufficient to make such guarantees credible, and this game, too, is best interpreted as arbitraging an implicit government obligation to pick up the tab should things turn sour.
On August 6 Fannie reported (hat tip: Calculated Risk):
Total nonperforming loans in our guaranty book of business were $171.0 billion on June 30, 2009, compared with $144.9 billion on March 31, 2009, and $119.2 billion on December 31, 2008.
This doesn’t mean that taxpayers are now out $171 billion, because the salvage value on these properties is not zero. On the other hand, more defaults could be ahead.
More fun –> http://www.econbrowser.com/archives/2009/08/paying_for_desi.html
here is an interesting question:
It’s interesting that China did not surpass Japan until September of 2008; and that those two countries dwarf all the other holders. How long can Japan avoid having to redeem some of these assets to fund domestic social programs?
http://japanjapan.blogspot.com/2009/08/as-reported-in-us-treasurys-tic-report.html
Victorian, who cares. Bottom line when money evaporates into thin air you can run printing press and replace the evaporated money with zero risk of inflation. That is all that happened at Fannie and Freddie.
bring a gun to corrados? obviously, you have not been in camden or north philly after dark. Paterson. .. . please. . . .oh I am so scared!
What we now need is a John story about the three mentioned cities or SAS to talk about his adventures in said cities.
Step away from the discount cheese, Morpheus.
Corrado’s in Clifton? Come on! Go a mile North and maybe a gun would be helpful, but we’re talking Main Ave. in Clifton!
133. Camden? north Philly, Paterson? please. Try south Westfield, below the train tracks. You’ll be thanking Jesus every night, IF you make it out alive.
Stu – I thought anything that wasn’t in the “Montclair Heights” section of Clifton might as well be ghetto. At least that’s what the fancy ladies in Upper Montclair all believe.
France and Germany out of recession…..
http://news.yahoo.com/s/ap/20090813/ap_on_bi_ge/eu_eu_economy
Of course, since the press doesn’t care that they snuck out using a cash for clunkers program, why should I?
Buy a house now OR ELSE!!!!!!
“Victorian, who cares. Bottom line when money evaporates into thin air you can run printing press and replace the evaporated money with zero risk of inflation. That is all that happened at Fannie and Freddie.”
John, that money didn’t evaporate into thin air. It went into the seller’s pocket.
corrado’s-clifton.
I stand corrected. . . it is clifton. My bad.
Well, I can’t proofread and I am geographically challenged.
http://www.northjersey.com/news/bergen/bergen_pzb_meetings/Ridgewood_defeats_rezoning_proposal.html
Yea right, that money went into SUVs, trade up homes, vacations, blow, country clubs, stocks and other junk that also blew up. Someone flipping homes ain’t exactly the t-bill and cd type.
Ben says:
August 13, 2009 at 2:04 pm
“Victorian, who cares. Bottom line when money evaporates into thin air you can run printing press and replace the evaporated money with zero risk of inflation. That is all that happened at Fannie and Freddie.”
John, that money didn’t evaporate into thin air. It went into the seller’s pocket.
http://www.northjersey.com/news/business/business_news/Foreclosure_activity_up_sharply_in_NJ.html
Re: Ben @ 111
“Kettle, not neccessarily. For areas along the West coast that saw the biggest amount of foreclosures coupled with the largest declines in price (~70% off peak), their sales levels in the 4th quarter of 2008 actually eclipsed the sales levels seen in 2004/2005, the height of bubble mania. Keep in mind, this is despite the fact that the banking system imploded. The end result is, every one of those houses are now filled with people who can pay mortgages rather than becoming a ghost town. Meanwhile, in areas where we are now trying to prop up prices or reduce the speed of the decline, we get homes sitting empty on the market rotting for over a year.”
Amen.
“Yea right, that money went into SUVs, trade up homes, vacations, blow, country clubs, stocks and other junk that also blew up. Someone flipping homes ain’t exactly the t-bill and cd type.”
So then it went to China. It didn’t evaporate.
Have another piece of chocolate cake.
http://www.bloomberg.com/apps/news?pid=20601039&sid=a04oVutXQybk
I am late responding to this.
People have short memories and no matter how bad a recession or depression has been, from what history shows us, we bounce back.
I am probably of the lower age group reading this site, so I still have time to see a recovery and probably another bubble or two.
I have noticed that there are many individuals on this site who feel this is the end of civilization as we know it, but history always repeats itself.
x-underwriter says:
August 13, 2009 at 9:01 am
Nobody on this website feels that the prices in Northern NJ will rebound in 09 and possibly not even in 2010…
Why would you believe they will rebound? What evidence or infomration can you offer that would support that?
Ben, Vic
I am wtih john on this one. Money has evaporated. When the value of a CDO/MBS or other instrument goes from 100 to 35 because the ratings agencies gave a pile of NINJA manure a AAA rating, the money didnt go to china or anywhere else. The money existed only as long as everyone agreed that NINJA manure was worth X with a AAA rating. Mr market now says that NINJA Manure is junk grade and worth 35 if your lucky.
While some money has moved to china or elsewhere a massive amount has simply ceased to exist as a consequence of a fiat money system that uses debt as money. When the value of that debt falls or is defaulted upon, money is destroyed
As always, reality is somewhere in the middle.
That said, we’re not yet at bottom in terms of pricing.
Ball,
it may be the end of the financial world as 99% of people alive remember it. But life will go on, just with less bling, a used car, and no european tours
Grim,
What gets me is no one can explain how prices, and consuption are going to go back up when we are seeing an acceleration of wage decreases with no effective driver to stabilize them or bring them back up, while at the same time the average family holds a significant amount of consumer debt.
Unless incomes are increased enough so that consumers have excess cash after servicing their increasingly expensive debt then there is mechanism for price real (as in adjusted dollars) price increases.
In order to effectively increase “real” incomes you would have to reverse the effects of globalization. This means increasing labor costs in the US and hence needing to prevent jobs from moving to lower labor cost regions.
How do you get around the effect of globalization leveling the laying field by bringing everyone to the lowest common denominator?
corrados ,, that may even be a foreign
zone down their.
The seeds for world class riots are being set. IF the younger generation loses hope/ belief that they have a shot at a good future things will get ugly quickly. They dont have a family and all the trappings of “adulthood” to hold them back.
UK young jobless count climbs to ‘crisis’ point of 1 million
Nearly one million young people are out of work as British unemployment hits a 14-year high, new figures showed today. Official data revealed that youth unemployment has soared, with more than 700,000 18 to 24-year-olds and 206,000 16 to 17-year-olds jobless.
In the three months to June, the number of 16 to 17-year-olds in work dropped to only 28.6 per cent, from 34 per cent a year earlier. The employment rate for people aged 18 to 24 dropped to 59.8 per cent, from 64.1 per cent.
The figures formed part of what economists described as a “ghastly” set of employment data, which showed that the jobless total had hit a 14-year high of 2.44 million and that the jobless rate had reached a 13-year-high of 7.8 per cent. Analysts and unions are particularly concerned about the outlook for hundreds of thousands of young people, warning that it was set to get worse as the latest crop of students left education only to find themselves unable to find work.
http://business.timesonline.co.uk/tol/business/economics/article6793174.ece
Kettle1 (151):
Exactamundo. I will believe a recovery is underway when consumer spending actually increases for three straight months. Until then, it’s just moving the deck chairs. The fact that Wall Street and the FED/Treasury figured out a new way to lie about financial balance sheets is not an impetus to a recovery. I really do hope that some of those 100s of billions in Wall Street bonuses actually goes to purchasing something tangible to increase our GDP. Right now, I’m not seeing it. A recovery in equity prices does not equal a recovery in the underlying fundamentals of the companies they supposedly represent. Only time will tell if this disconnect is from irrational exuberance vs. a forward looking market.
My bet is on IE.
U.S. mortgage rates rise, may curb demand: survey
Interest rates on U.S. 30-year fixed-rate mortgages averaged 5.29 percent for the week ending August 13, up from the previous week’s 5.22 percent, said a survey released by home funding company Freddie Mac (NYSE:FRE – News; NYSE:FRE – News).
Mortgage rates remained above 5 percent for an eleventh straight week. Experts say mortgage rates at 5 percent and below are what is necessary to make a significant impact on home loan demand.
Higher rates have dampened demand for home loan refinancing, a reversal from earlier this year when rates below 5 percent caused refinancing activity to surge.
Stu,
Lets play a game. Assume for a moment that in a few months we take another dive off the deep end and then we stay in the crapper for a while. What does that say about the whole “forward looking” mantra?
kettle1 – you sound lost, are you questioning your deflation call now?
As far as trade goes international trade/globalism is way off from it’s peak. It is reversing, just take a look at the Japanese exports. They are in for a world of hurt. The only saving graces in the comsumer numers toady were cash for cars and oil. PCE is way down, don’t let anyone tell you different. Just check with the FRED.
“forward looking”
I suppose it says things are different this time!
Of course following an investment strategy that consists of following Warren Buffet’s silly anecdotes is so much easier.
The dude can attribute almost his entire success from investing in insurance companies for two decades in which they outperformed all other sectors. Now he uses the advantage of his large bankroll to bully companies around.
Remember, lead the herd, don’t follow it. Be the first to run off the cliff!
“I am wtih john on this one. Money has evaporated. When the value of a CDO/MBS or other instrument goes from 100 to 35 because the ratings agencies gave a pile of NINJA manure a AAA rating, the money didnt go to china or anywhere else. The money existed only as long as everyone agreed that NINJA manure was worth X with a AAA rating. Mr market now says that NINJA Manure is junk grade and worth 35 if your lucky.
While some money has moved to china or elsewhere a massive amount has simply ceased to exist as a consequence of a fiat money system that uses debt as money. When the value of that debt falls or is defaulted upon, money is destroyed”
But all measures of the money supply are increasing.
CPI, Industrial Production and Consumer Sentiment are to be reported tomorrow. IP should be very high as we (not the government) are paying people to buy cars.
Ben,
“all measures” ?
There is no government measure of all the “money” + all the debt in the market. the closest to that was M3 but even that measure has holes n what it is not tracking.
All measures of “currency” as in paper/electronic federal reserve notes are indeed increasing, but that has little effect if its velocity is minimal or 0. If all of the printed money s locked up in bank vaults as required reserves against mark-to-myth bank (or are they REITs) portfolios or the banks simply refuse to lend/ cant find demand to lend, then all the printing in the world doesnt help.
on top of that the quantity of debt based money that has ceased to exist is 1 or 2 orders of magnitude greater then what has been printed.
They have printed about 800 billion or so last i checked but housing alone has lost more then 3 trillion. Then consider the leverage effects of the instruments based on housing. there are estimates that suggest 10 – 20 trillion in value has been lost in debt based derivatives.
you may not care about the debt based derivatives or the fact that you havent lost money on your house because you havent sold. But the corporations and banks do care, as they are effected in the present by these future losses in value
M3, U6, blah blah blah.
Grab a Bud and flip out the footrest on your Palliser… ‘So You Think You Can Dance’ is about to start and that botulistic judge is about to scream another wacky comment.
The end ain’t nigh, there will be no second coming of Oct08 or Mar09…. start figuring out how you too can get rich on Uncle Sam’s teet or you will be left with pockets full of .223 rounds and no one to shoot them at.
Nihilism is so 2008 and if I said it once, I’ve said it 1000 times. Americans won’t riot, too lazy.
Dubbed the “All-You-Can-Jet Pass,” this deal only runs through August 21 — so you’ll have to act fast. Here’s what you get for your $599:
The right to fly anywhere (that jetBlue goes) in the U.S., as often as you like, between September 8 and October 8, 2009.
The price includes taxes and fees (save for international flights and Puerto Rico.)
You must reserve your flights at least three days ahead of time.
And if you’ve already bought a ticket within this timeframe — no sweat. Pay the difference between your ticket and the $599, and you can upgrade to the Pass.
#153
There is nothing more dangerous to a country that a mass of unemployed youngsters looking for work. Idle mind devils workshop..
bi and frank – sorry guys.
http://wellness.blogs.time.com/2009/08/11/the-science-of-one-night-stands/
Cyclonic Action Vacuum says:
is that clot??
YF:
Three Ways to Predict the End of the Housing Bounce
http://finance.yahoo.com/news/Three-Ways-to-Predict-the-End-minyanville-1909575148.html?x=0&sec=topStories&pos=6&asset=&ccode=
“Anyone touting housing’s so-called “bottom” is likely trying to sell you something — namely, a house.”
Everything you need to know about the coming collapse of everything:
http://www.zerohedge.com/article/last-weeks-insiders-transactions-1-buys-60-million-136-sells-over-115-billion
Cyclonic Action Vacuum = Clotpoll
#123 Clotpoll says:
“Seen five things today that convince me the day of reckoning is nigh.”
Clot: You’re such a tease. Please elaborate.
164: What’s the catch? All flights to anywhere you would want to go are already booked?
New thread, up!
I hope this downward slide eventually cools off since I am about to close on a home in Glen Ridge and would prefer not to lose too much value. On the plus side, I plan to stay there for at least 10 years, so I’m not overly worried.
#174 – Congrats! Where about? GR is a nice place to stay for the next 10 years, property taxes aside, of course.