Cocktail Waitress turned Realtor: “The market has gone straight down like an airplane nosediving,”

From the Press of Atlantic City:

Few buy into career as Realtor

Phillip Golden became a real estate agent for Re/Max Community in Mays Landing in 2009, the year homeowners across the country filed nearly 4 million foreclosures, the result of a financial crisis that continues today.

After his first year in the industry, he said he has learned a lot and also helped coach struggling homeowners through their own crises.

“The slowness of the market has acclimated me to what the market should be,” he said. “Real estate is a slow investment. It’s not run-and-gun like it was. It’s not something that should be bought and traded like a stock.”

When the housing market began declining in 2006 and then plunged the following year, being a real estate agent went from being a lucrative career to a stress-filled livelihood.

“When the bubble burst, a lot of people just jumped,” said Judy Appleby, president of the New Jersey Association of Realtors, whose membership is down from a peak of 55,0000 members to about 48,000 now.

Since then, the people who did choose to get their real estate licenses have varying perspective on their new jobs.

Peggy Silverman colored her experience with a slightly less rosy brush since she got her real estate license in 2008, when the federal government was funneling billions of dollars into the economy to stem a tide of foreclosures and layoffs.

“It’s been a nightmare,” said Galloway Township native who is now an agent for Prudential Diversified Realty & Associates in Smithville, Galloway Township.

Silverman, 61, was a cocktail waitress for 28 years in Atlantic City and needed a change. She had always been friendly and had a keen interest in interior design, so she thought selling homes would be a good fit.

She knew the market was bad, but had no idea how bad until she got in the midst of it.

“The market has gone straight down like an airplane nosediving,” she said. She now looks at the paper daily, looking to get a second career in the health care industry.

After being one of the first waitresses at Bally’s Atlantic City, and now a real estate agent for about two years, she hopes she can find a second job that’s a little bit more resistant to a bad economy.

“I got to pay my mortgage. I got to eat, and real estate has almost come to a standstill,” she said. “And that’s a known fact.”

This entry was posted in Economics, Housing Bubble, New Jersey Real Estate. Bookmark the permalink.

151 Responses to Cocktail Waitress turned Realtor: “The market has gone straight down like an airplane nosediving,”

  1. grim says:

    Cue bailout plan number 83… How quickly is this one be dubbed a failure?

    No worries folks, the first 15 mortgage plans failed, but we know what we’re doing, we saved the special sauce for bailout 83.

    From the WSJ:

    Government to Deploy Broader Mortgage Aid

    The Obama administration on Tuesday will launch its most ambitious effort at reducing mortgage balances for homeowners who owe more than their homes are worth.

    Officials say between 500,000 and 1.5 million so-called underwater loans could be modified through the program, the first initiative to target homeowners who are current on their mortgage payments but are at risk of default because they have no equity in their homes. Some experts are warning, however, that the same knots that tied up prior initiatives could do so again.

    Under the new “short refinance” program, banks and other creditors that write down mortgages to less than the value of the property can essentially hand off the reduced loan to the government. The process involves refinancing borrowers into loans backed by the Federal Housing Administration.

    While the program puts taxpayers at risk—officials estimate one in five loans in the program could default—the government has set aside $14 billion previously earmarked for housing aid from the Troubled Asset Relief Program to cover losses.

  2. Confused in NJ says:

    Give the Grasshopper the Ants House. If the Ant was stupid enough to work for his, he doesn’t deserve it. Only the Grasshoppers who don’t work for it deserve it. So say’s “O”.

  3. Yo'me says:

    But not every homeowner who is underwater can participate. The bank or investors that own the loan must be willing to write down its value.

    Under the new “short refinance” program, banks and other creditors that write down mortgages to less than the value of the property can essentially hand off the reduced loan to the government. The process involves refinancing borrowers into loans backed by the Federal Housing Administration

    This two statements is confusing me.If they can unload the reduced valued asset to the FHA why will they not qualify every applicants, instead of waiting for them to walkaway.I will think the lost is a write off.

  4. gary says:

    Under the new “short refinance” program, banks and other creditors that write down mortgages to less than the value of the property can essentially hand off the reduced loan to the government.

    So, the majority of buyers get a gift for their f*cking stupid1ty and the realtors and lenders who finalized the originial heist still get to keep all commisions with zero scrutiny. Meanwhile, the m0ron buyers get a big gift from Oblama Daddy and we become a victim of social engineering. And, of course, the whiz-bangs who got a reduced mortgage get to keep any profits if they sell the house in a few years and values have risen, correct? Un-f*cking believeable.

  5. leftwing says:

    “Officials say between 500,000 and 1.5 million so-called underwater loans could be modified through the program, the first initiative to target homeowners who are current on their mortgage payments but are at risk of default because they have no equity in their homes”

    Again, equity value (a balance sheet item) has no bearing on the ability to service a mortgage (an income item).

    But it sure sounds like a big, scary situation that needs fixing……

  6. Yo'me says:

    And, of course, the whiz-bangs who got a reduced mortgage get to keep any profits if they sell the house in a few years and values have risen, correct? Un-f*cking believeable.

    House prices only goes up.My uncle told me so.

    If you closely followed the bank bailout, then you know it wasn’t originally billed as simply throwing money at the banks. Instead, the Treasury intended to purchase the toxic assets from banks, which were the source of investors’ uncertainty concerning bank stability. But the Treasury couldn’t figure out a way to do this quickly enough to make it effective. As a result, the banks were largely stuck with these bad assets. We just don’t know how bad, yet.

    http://finance.yahoo.com/family-home/article/110581/5-doomsday-scenarios-for-the-us-economy

  7. leftwing says:

    SX, from last night

    Yeah, my buddy’s a decent guy. Kind of a white collar version of J6P. Middle of the road college, normal looking, works in sales at a major (non-financial) company we all know, and just had things work out well for him.

    It’s no secret to anyone here my feelings toward large government and regarding self sufficiency. I’m fixated on his modification because until it hit this close to home the malfunctioning of the federal government and more importantly the underlying social change that enabled it was, I realize now, an abstraction.

    Why does it matter to me that the government handed $100k to an individual who has zero need for it and didn’t request it? It’s not about the individual, I’m his friend and happy for his windfall. It’s not about the money, my family doesn’t want. It’s not about morals, values are personal. It’s not emotional, long ago I gave up emotions regarding matters financial.

    It’s because it drives home the point that I don’t fit anymore. That my values are not only obsolete, but repugnant in many quarters. I’m the guy that volunteers time all over the place even when I have no time to give. That sits on three NFP boards. That donates in the five figures annually to two of them, confidentially. That funded 529s to the max the day they came out for my kids because I (underscore I) needed to send them to college. That put no less than a third down on each of the properties I own specifically because I did not want to find myself underwater. That was able to do so because I worked hard enough, often to the detriment of my own family, to create something and was taught to give back.

    And what I’ve discovered is that this worldview makes me an idiot. A schmuck. A patsy.

    And you know what now? That’s OK. This week has been a very special week for me. It has been a long time since I have had this kind of self realization, epiphany even. The last was about five years ago. I went through the rehab process to support a friend’s recovery. During the time I spent at the facility I learned an incredible amount about myself such that it changed fundamentally who I was. Current events, culminating in this very tangible example, have done so again.

    So, today when I sit overlooking the water with probably the largest, most sincere smile on my face in a long time you’ll know why. It’s not because I’m basking in the warm sun during the last weekend of summer, or watching the kids enjoy themselves in the kayaks, or being surrounded by good friends, or even the 9% ABV on the Chimay. It is that level of deep content that comes with clarity of purpose, of filling a role tailor made for you knowing that you can do it very well. And that role is taking society, bending it over the table with hard heel of the palm to the back of the neck, and throwing the vaseline over my left shoulder.

    I’ve posted repeatedly over time on the adverse effects of dependency on big government. Its most insidious effect is the eradication of personal responsibility and social norms and values. I now willingly accept a Platinum Card into that club.

    I feel as if a large weight has been lifted.

    Everyone, enjoy your Labor Day weekend.

  8. Yo'me says:

    who are current on their mortgage payments but are at risk of default because they have no equity in their homes”

    This is more of a psychological distress.”Why continue being a sucker,” Companies and businesses do it.

  9. Cindy says:

    http://seekingalpha.com/article/223835-a-new-program-to-attack-underwater-mortgages?source=dashboard_macro-view

    Left and Clot – Continuing the conversation from yesterday….

    “…but taking on mortgages that were already modified doesn’t seem to accomplish much aside from relieving the banks of potential loss at the expense of the taxpayer.”

    Clot – I do believe you said that @ 171

  10. Cindy says:

    http://seekingalpha.com/article/223886-harry-dent-s-outlook-on-demographics-debt-and-deflation?source=dashboard_macro-view

    I know, I know..Harry Dent has been wrong about many predictions. But…I like his concept of different spending patterns at different stages of life.

    It also explains the lack of stimulus from the stimulus.

    “…for the first time ever, we don”t have favorable demographic winds at our back. During previous recessions, the government could float money out into the economy, and eager consumers would grab it and spend it – because they were in the upswings in their spending patterns.”

    More predictions…..Housing bottom – 2012. Next upswing in spending patterns – 2022.

  11. yo'me says:

    It used to be one income in a family is the norm.With the growing income gap between the top 5% earners and the rest of us,we had to come up with ways how to make our lives manageable.Woman’s lib came,two income families started.Then the 3 income family,one parent need to work 2 jobs and one work one and keep the home tidy.Some families have 4 incomes now,with both working two jobs.What kept the middleclass being able to keep spending was credit.Without credit and 3 or 4 incomes,still not able to manage,where will the next spending spree come from? The top 5% earners are the only hope but there is a saying “They don’t spend that is why they are rich”

  12. Cindy says:

    http://www.washingtonpost.com/wp-dyn/content/article/2010/09/04/AR2010090403571.html

    Here’s a good one for you Gary and Barbara…

    “In struggling housing market, buyers and sellers are out of sync”

    Well no kidding!

  13. yo'me says:

    About a year ago Cary Feldman was surprised to find himself sprawled on the pavement in an intersection in Chicago Heights, Ill., having been knocked off his motor scooter by the car behind him.

    Five months later he got another surprise: a bill from the fire department for responding to the scene of the accident.

    “I had no idea what the fire truck was there for,” said Mr. Feldman, of nearby Matteson. “It came, it looked and it left. I was not hurt badly. I had scratches and bruises. I did not go to the hospital.”

    Mr. Feldman had become enmeshed in what appears to be a nascent budget-balancing trend in municipal government: police and fire departments have begun to charge accident victims as a way to offset budget cuts.

    Ambulance charges have long been common and are usually paid by health insurance, but fees for other responders are relatively new. The charge is variously called a “crash tax” or “resource recovery,” depending on one’s point of view. In either case, motorists are billed for services they may have thought were covered by taxpayers.

    Collection agency
    Sometimes the victim’s insurer pays. But if it declines, motorists may face threats from a collection agency if they don’t pay.

    The AAA opposes such fees, said Jill Ingrassia, managing director for government relations and traffic safety advocacy. “Generally, we see that public safety services are a core government function that should be properly budgeted for with general taxes and not addressed by fees after the fact,” she said.

  14. Shore Guy says:

    “are at risk of default because they have no equity in their homes.”

    How does owning an asset thet is worth less than one paid for it make one a risk for default?

    One is at risk of defaault if one’s cash flow is unableto cover the loan. The loss of some value of the asset itself is not a driving factor.

    Gimme a bloody break.

  15. Xroads says:

    Now is the time to buy! %3.5 down and a write down if your underwater which should be next week! I guess that’s my question what if your already FHA are they writing you down automatically? What the he’ll are the FHA and gse’s doing besides setting up the taxpayer for huge losses. I don’t get it

  16. serenity now says:

    RE#14
    How does owning an asset thet is worth less than one paid for it make one a risk for default?

    It looks to me like they are targeting people who would
    “strategically default” even though they could still make the payments.

  17. Cindy says:

    http://paper-money.blogspot.com/2010/09/first-time-goldbuyer-tax-credit-and.html

    Here we go…Ha ha ha ha ha ha

    “First-time Goldbuyer Tax Credit and a new government GSE “Goldie Mick.”

    for the disenfranchised Americans who have never had the opportunity to own gold….

  18. gary says:

    Prices in our area are still about 20% over-priced. Period. End of f*cking story. Every asset reverts to the mean, nothing and no one can stop it. The 1diots fell for the bullsh1t line and were hoodwinked and swindled. Everyone shouldn’t have to pay for the mistakes of a few. People need to walk away from the ball and chain and the banks need to take the pain. Tough Sh1t. Fire the top 20% of the overpaid execs and they’ll survive.

  19. Yikes says:

    Bad, bad stuff here

    http://www.nytimes.com/2010/09/03/opinion/03reich.html?pagewanted=all

    In the late 1970s, the richest 1 percent of American families took in about 9 percent of the nation’s total income; by 2007, the top 1 percent took in 23.5 percent of total income.

    The rich spend a much smaller proportion of their incomes than the rest of us. So when they get a disproportionate share of total income, the economy is robbed of the demand it needs to keep growing and creating jobs.

    What’s more, the rich don’t necessarily invest their earnings and savings in the American economy; they send them anywhere around the globe where they’ll summon the highest returns — sometimes that’s here, but often it’s the Cayman Islands, China or elsewhere. The rich also put their money into assets most likely to attract other big investors (commodities, stocks, dot-coms or real estate), which can become wildly inflated as a result.

  20. Mocha says:

    Hey Renter,

    That is chilling footage, I only wish my french was up to par to read the referenced link.

  21. Mr Hyde says:

    Gary,
    from last thread,

    Gary

    Anyone intelligent enough to earn real money is certainly not stupid enough to come within 80% of asking price.

    get an FDA loan with 0 down (DO NOT REFI) and then pay the mortgage only as long as its convenient then play foreclosure dodgeball with the banks!!!!

    I would argue that this is the only sane/logical way to even consider buying for the majority of people right now.

  22. Mr Hyde says:

    Leftwing 7

    I definitely understand your point, but the question arises, what do you teach your children? Do you teach them the standards you grew up with or to F it all?

  23. Yikes says:

    wonder how angry Jamil will get when he read this.

    The Koch brothers …

    http://www.newyorker.com/reporting/2010/08/30/100830fa_fact_mayer

    I’m sure he won’t even read it because of the publication. Or because of the writer. Or he’ll find some other laughable reason to dismiss it. Facts are facts, of course …

  24. crossroads says:

    Hyde
    “get an FDA loan with 0 down (DO NOT REFI) and then pay the mortgage only as long as its convenient then play foreclosure dodgeball with the banks!!!!”

    do you think an fha loan will have faster principal write downs in the near future because of their current practice of trying to keep housing prices high

  25. Mr Hyde says:

    Crossroads,

    You can get 0 down with an FDA loan but only 3% with FHA. I am not 100% certain but i believe that even the FHA and FDA loans are non recourse in NJ as long as you do not REFI. Once you REFI they become recourse.

    Going the FDA route is maximum leverage and puts none of your money at risk. you are only playing with house money in a game that is rigged to loose. Might as well play large with the houses money!

  26. Mr Hyde says:

    Crossroads.

    And dont feel bad if you do this. Its just business and you are only playing by the established rules. Morals and ethics should have nothing to do with it at this point as A West pointed out before.

  27. Shore Guy says:

    Ahh, the new motto for the United States (or either congress or the Great Seal of the President):

    “Morals and ethics have nothing to do with it”

    Who needs all that “E pluribus” stuff.

  28. Mr Hyde says:

    Shore guy

    The system has become so corrupt that to attempt ethical and/or moral behavior virtually guarantees you will lose.

    I am an eagle scout and believe in the principles of the scout oath as ridiculous as some may thing that is today. I have not quite made it as far as A West, but completely understand his position.

    ” Thou hast no knowledge of the life thou art leading; thy very existence is now a mystery to thee. ” – ‘The Bacchantes’ By Euripides

  29. scribe says:

    Someone in my apartment building was evicted around May 31. A rare event since my landlord hates going to court, and will carry people for years to avoid it.

    The super was telling me that this woman hadn’t paid her rent in full in at least 10 years. She had something of a breakdown in the mid-90’s and went on a spending spree – traveled all over Europe on credit cards – and then lost her job after 9/11 and just couldn’t recoup.

    She asked the landlord to proceed with an eviction in court so she could get stimulus money to pay her credit card debt and back rent. I said to the super: “I thought that was a joke – Obama will pay my credit cards.” The super said – nope, she was working with a social worker. The super wasn’t clear if the tenant got the money and decided to keep it and split, or whether she botched the process and didn’t get it. She moved out.

    But I was amazed that individuals could apply to get stimulus money for stuff like that.

  30. Cindy says:

    http://www.nytimes.com/2010/09/06/business/economy/06housing.html?pagewanted=1

    Grim – check this out – How can I pass up a title like this…

    “Grim Housing Choice: Help Today’s Owners or Future Ones”

    “…When prices are lower, these experts argue, buyers will pour in, creating the elusive stability the government has spent billions upon billions trying to achieve.”

  31. jp says:

    I sure hope the democrats lose a lot of seats.

  32. spyderjacks says:

    Republicans don’t have any plan except divisiveness and fear. I figure they’ll gets tons of seats, do absolutely nothing and then the backlash brings in the sitting president for a landslide second term. We all (USA) got in this situation by living beyond our means. We all (USA) get out when we pay the bill. Until then, suck it up. Or please let me know who is doing it better. Or who can fix this problem.

    Frankly, whatever the political shift, we are simply trading one set of thieves and bone-heads, for another.

  33. Confused in NJ says:

    Whenever companies start hiring freely again, job-seekers with specialized skills and education will have plenty of good opportunities. Others will face a choice: Take a job with low pay — or none at all.

    Job creation will likely remain weak for months or even years. But once employers do step up hiring, some economists expect job openings to fall mainly into two categories of roughly equal numbers:

    • Professional fields with higher pay. Think lawyers, research scientists and software engineers.

    • Lower-skill and lower-paying jobs, like home health care aides and store clerks.

    And those in between? Their outlook is bleaker. Economists foresee fewer moderately paid factory supervisors, postal workers and office administrators.

    That’s the sobering message American workers face as they celebrate Labor Day at a time of high unemployment, scant hiring and a widespread loss of job security. Not until 2014 or later is the nation expected to have regained all, or nearly all, the 8.4 million jobs lost to the recession. Millions of lost jobs in real estate, for example, aren’t likely to be restored this decade, if ever.

  34. CNA Training says:

    Great information! I’ve been looking for something like this for a while now. Thanks!

  35. Final Doom says:

    gary (4)-

    Don’t forget that this program further primes the FHA plutonium bomb of bankruptcy/bailout/writedown…all with garbage paper, 100% backed by the US taxpayer.

  36. Final Doom says:

    left (7)-

    Come spend a week with me at work. You’ll be ripping your hair out.

    And, you’ll be spending lots of time looking at expatriation alternatives.

    “It’s no secret to anyone here my feelings toward large government and regarding self sufficiency. I’m fixated on his modification because until it hit this close to home the malfunctioning of the federal government and more importantly the underlying social change that enabled it was, I realize now, an abstraction.”

  37. Final Doom says:

    Cindy (9)-

    Precisely. Stealth bailout.

  38. Final Doom says:

    hyde (24)-

    Fcuk it all. Not even a debate in my house.

  39. Final Doom says:

    hyde (24)-

    The unofficial theme for my daughter’s HS field hockey team this year (at your lovely alma mater, NHHS) is “fight or fcuk”. My daughter is one of the captains, but thankfully, she’s not so far gone as to be the one who came up with that gem.

  40. Final Doom says:

    Hyde (30)-

    If you’re talking Euripides, I much prefer “The Frogs”.

    I dated a girl once who was part of the chorus in an ensemble who performed the entire play in a swimming pool.

    I liked her as much as I like french fries. She could also hold her breath a long time.

  41. Final Doom says:

    Just give me a gat and tell me who to shoot.

    “Yesterday we presented Dylan Grice’s thoughts on why economists and their opinions should be summarily dismissed as nothing but mere noise on the steep downward slope of a series of failed “authoritarian” policy decisions, which seek to validate one false choice after another, by presenting a hypothetical and fallacious counter-outcome as a certain reality (just consider the “apocalypse” we would be living in if Goldman had failed: of course, there is no justification for this except for what Bernanke et al claim is the one true alternative reality based on nothing but their own conflicted interests), which does nothing but discredit the “science” of economics more and more with each passing day. Yet in the grand scheme of things economists are merely pawns in the hands of the landed elite: the financial system set only on perpetuating the status quo of capital and wealth reallocation from the lower classes onto itself (until there is eventually nothing left), and a government whose only prerogative is to usurp ever more control and authority, until the entire system is one of central planning in economics, social affairs, religion, and every aspect of people’s daily lives, all the while pretending to operate under the guise of a democracy, which, at least in America, died long ago. Today, we present the observations of Bill Buckler from his Privateer report, which picks up where Grice left off and demonstrates why one must not only never rely on economists but on form of “authority” in general. Putting it all together is Buckler’s close analysis at the glue that makes it all possible: the Federal Reserve, also known as the fourth branch of government, and the entity that provides the endless funding for all of the system’s failed policies. As Buckler points out, any reversion to a system that follows the constitutional precepts of the founding fathers will need to do away with the Fed first and foremost, as “the issue is not the political will of the US government to go on spending beyond its means, it is the political will of the rest of the world to go on accepting the unworkable global system indefinitely. They will not do it.” In other words, in the step leading up to the last and most important defection in the global prisoner’s dilemma, it is up to the American people to take the necessary step to restore the systemic balance (which will happen regardless eventually, only in a far more violent fashion). Everything else that happens on a day to day basis is completely irrelevant.”

    http://www.zerohedge.com/article/why-fourth-branch-us-government-needs-be-abolished-and-why-authority-should-never-be-trusted

  42. jamil says:

    25 Yikes “I’m sure he won’t even read it because of the publication. Or because of the”

    Nice try. You are right, I won’t bother to read it as JournoList (or whatever it is nowadays called), in coordination with the White House, has already formed a same Narrative that is being distributed in every leftist outlet. It was amusing to read JournoList archives from 2008 where “journalists” and campaign managers planned the strategy how to distract public from Zero’s connection to Rev Wright “let’s pick some randon conservative..Kristol, Limbaugh, who cares.. and accuse them of racist”. Yes, this was your honest State Media in work.

    Every election cycle dems hype up some random conservative billionaire are the latest bogeyman who is behind all conspiracies. Now they have apparently picked Koch. Dick Morris had a lot of stories how he picked some random conservative for Bill Clinton’s campaigns. Of course, leftist billionaires (say, Soros) who donate $100M for voter fraud through ACORN are somehow omitted from these stories.

    Yes, Yikes. Facts are facts.

  43. gary says:

    And those in between? Their outlook is bleaker. Economists foresee fewer moderately paid factory supervisors, postal workers and office administrators.

    Tell that to the fat f*cks who priced their rat holes in the stratosphere as a malodorous funk emanates from their attic vents.

  44. Final Doom says:

    Cabbage-ass mf’ers.

  45. Final Doom says:

    When I first started coming to this blog, I wanted to put up well-written posts that would give readers some idea of what a Realtor who has half a brain actually does during the course of a day.

    Now? I just want to string together obscenities in new and interesting ways.

  46. gary says:

    Boil cabbage in an eight quart pot filled with Rheingold beer for about 5 hours with every window closed on a 98 degree. Then hold an open house and demand $649,000 for avocado shag rugs and pink and black tiled bathrooms.

  47. gary says:

    98 degree day.

  48. Mr Wantanapolous says:

    Minutes from last Fed meeting;

    “Out here the nights are long, the days are lonely
    I think of The Great D and I’m working on a dream
    I’m working on a dream”

  49. Mr Wantanapolous says:

    Cindy [18],

    It’s going to the moon; along with Hi-Yo.

  50. Final Doom says:

    gary (48)-

    Post of the year.

  51. harsmith says:

    But there’s one thing you should make clear, that the quality of the hermes replica handbags are almost as good as those authetic ones.

  52. leftwing says:

    Hyde

    Funny you bring up the kids. In all seriousness, not inculcating them with traditional values and a sense of personal responsibility will be what pains me the most.

    You already know the answer to your question, though. You posted it above. Your kid comes to you seeking advice on a house purchase today, what are you going to tell him? Sacrifice, save, and put 20%+ plus down so you can ride out the hard times? Or, cut the line, grab a 0-3.5% down, so you can split when the going gets tough?

    It’s too bad, my oldest is a stereotypical first born – conservative, responsible, somewhat protective of younger ones, etc. I’ll need to toughen him up, get him a bit of a nasty edge.

    Philosophically, we are abandoning what once may have been called ‘Judeo-Christian’ or ‘traditional American’ values. I think I’ll call this value system ‘Legal Predation’. Skate right up to the line but don’t cross it, take every advantage as your own, and show no mercy.

    Welcome to the moral ghetto-ization of your country, as we all become jostling supplicants in one big line in front of the Federal government.

  53. Mr Hyde says:

    Leftwing

    You already know the answer to your question, though. You posted it above. Your kid comes to you seeking advice on a house purchase today, what are you going to tell him? Sacrifice, save, and put 20%+ plus down so you can ride out the hard times? Or, cut the line, grab a 0-3.5% down, so you can split when the going gets tough?

    I would take a middle road. If the house was for their family and provided for improved stability/housing security, then i would advocate the cutthroat route. However, if it were simply for hedonistic consumption, or to impress the crowd then i would recommend against it.

    In the world we quickly see evolving around us traditional values are rapidly shifting such as they only make sense when dealing with friends and family. Anyone outside that circle should probably be treated with cutthroat principles.

  54. leftwing says:

    “In the world we quickly see evolving around us traditional values are rapidly shifting such as they only make sense when dealing with friends and family. Anyone outside that circle should probably be treated with cutthroat principles.”

    It’s happening now, above and beyond what may be caused by the current economic situation, and it’s more than a simple battening down of the financial hatches. It’s happening on a philosophical level and changing one’s interactions with the larger community. I see it among my social circle.

    It will be interesting going forward even without some financial calamity to acclerate the trend. Humans are a hugely adaptive species, we need to be. Somehow we hung around this planet for 150,000 years while being outmatched in nearly every physical aspect important for survival. I really don’t want to be around when the clinical sociopathies that drive the top 1% become required skills for the rest of the population. It will be an ugly society. At least we’ll have a flatter income curve, I guess.

  55. Shore Guy says:

    BC,

    Then there is this little tune:

    A big golden river
    A man thought he had found
    So he spent all his money
    On a house and some ground
    And soon saw his net worth going
    Down, down, down.
    Now, he lives on the streets of Houston Town.

    Packed up his wife and his kids
    When the sheriff came along
    And headed down south with just spit and a song
    But chances for a good life were
    Gone, gone, gone.

    etc.

  56. wtf says:

    (31) “But I was amazed that individuals could apply to get stimulus money for stuff like that.”
    —————————
    They can’t. That’s bullsht. You’re listening to a guy who snakes toilets for a living? Are you also one of the 18% of morons in this country that think the president is muslim because you saw it in an email? The only people who get bailouts in this country are irresponsible homeowners, not irresponsible renters.

  57. Mr Hyde says:

    Leftwing

    that could be a very efficent society. At the first since of weakness you you would be consumed like an injured cow in a pool of pirranha. Of course being that humans are social animals there would seem to be some self limiting aspect to sociopathy before normal group interactions break down.

  58. Shore Guy says:

    ” The only people who get bailouts in this country are irresponsible homeowners, not irresponsible renters”

    Don’t forget irresponsible bankers.

  59. Yo'me says:

    1. The Origin of the Crisis

    This crisis began decades ago when a new wave of technology — things like satellite communications, container ships, computers and eventually the Internet — made it cheaper for American employers to use low-wage labor abroad or labor-replacing software here at home than to continue paying the typical worker a middle-class wage. Even though the American economy kept growing, hourly wages flattened. The median male worker earns less today, adjusted for inflation, than he did 30 years ago.

    But for years American families kept spending as if their incomes were keeping pace with overall economic growth. And their spending fueled continued growth. How did families manage this trick? First, women streamed into the paid work force. By the late 1990s, more than 60 percent of mothers with young children worked outside the home (in 1966, only 24 percent did).

    Second, everyone put in more hours. What families didn’t receive in wage increases they made up for in work increases. By the mid-2000s, the typical male worker was putting in roughly 100 hours more each year than two decades before, and the typical female worker about 200 hours more.

    When American families couldn’t squeeze any more income out of these two coping mechanisms, they embarked on a third: going ever deeper into debt. This seemed painless — as long as home prices were soaring. From 2002 to 2007, American households extracted $2.3 trillion from their homes.

    Eventually, of course, the debt bubble burst — and with it, the last coping mechanism. Now we’re left to deal with the underlying problem that we’ve avoided for decades. Even if nearly everyone was employed, the vast middle class still wouldn’t have enough money to buy what the economy is capable of producing.

    Where have all the economic gains gone? Mostly to the top. The economists Emmanuel Saez and Thomas Piketty examined tax returns from 1913 to 2008. They discovered an interesting pattern. In the late 1970s, the richest 1 percent of American families took in about 9 percent of the nation’s total income; by 2007, the top 1 percent took in 23.5 percent of total income.

    It’s no coincidence that the last time income was this concentrated was in 1928. I do not mean to suggest that such astonishing consolidations of income at the top directly cause sharp economic declines. The connection is more subtle.

    The rich spend a much smaller proportion of their incomes than the rest of us. So when they get a disproportionate share of total income, the economy is robbed of the demand it needs to keep growing and creating jobs.

    What’s more, the rich don’t necessarily invest their earnings and savings in the American economy; they send them anywhere around the globe where they’ll summon the highest returns — sometimes that’s here, but often it’s the Cayman Islands, China or elsewhere. The rich also put their money into assets most likely to attract other big investors (commodities, stocks, dot-coms or real estate), which can become wildly inflated as a result.

    Meanwhile, as the economy grows, the vast majority in the middle naturally want to live better. Their consequent spending fuels continued growth and creates enough jobs for almost everyone, at least for a time. But because this situation can’t be sustained, at some point — 1929 and 2008 offer ready examples — the bill comes due.

    2. What We Learned and Didn’t Learn From the Great Depression of the 1930s

    This time around, policymakers had knowledge their counterparts didn’t have in 1929; they knew they could avoid immediate financial calamity by flooding the economy with money. But, paradoxically, averting another Great Depression-like calamity removed political pressure for more fundamental reform. We’re left instead with a long and seemingly endless Great Jobs Recession.

    THE Great Depression and its aftermath demonstrate that there is only one way back to full recovery: through more widely shared prosperity. In the 1930s, the American economy was completely restructured. New Deal measures — Social Security, a 40-hour work week with time-and-a-half overtime, unemployment insurance, the right to form unions and bargain collectively, the minimum wage — leveled the playing field.

    In the decades after World War II, legislation like the G.I. Bill, a vast expansion of public higher education and civil rights and voting rights laws further reduced economic inequality. Much of this was paid for with a 70 percent to 90 percent marginal income tax on the highest incomes. And as America’s middle class shared more of the economy’s gains, it was able to buy more of the goods and services the economy could provide. The result: rapid growth and more jobs.

    By contrast, little has been done since 2008 to widen the circle of prosperity. Health-care reform is an important step forward but it’s not nearly enough

    Read more: http://www.businessinsider.com/welcome-to-the-worst-labor-day-in-history-2010-9#ixzz0ykeYyCcv

  60. crossroads says:

    28 Hyde

    if I go into default it would be for revenge! the housing bubble stole years from my family for doing the right thing which is renting and paying my bills. don’t worry no guilt here. whats the saying” fool me once shame on you fool me twice shame on me”
    my down payment stays with me and i hope inflation rears its ugly head if not its safe under my weapons cache

  61. Final Doom says:

    left (57)-

    The whole new order will be a lot like Enron. Feed the beast, and screw any outsider you need to keep the pack moving forward.

  62. Final Doom says:

    hyde (60)-

    At end, humans are pack animals. We’re reverting to our original behavioral pattern.

    However, we now have all kinds of neat weapons of warfare (both economic and military) to help us satisfy our cravings and become more efficient killing machines.

  63. Final Doom says:

    xroads (63)-

    Pity, pity. Strategic default isn’t a revenge response; it’s a necessary thing to do in order to keep pace economically.

    While I think it would be fun to screw a bank, in the end, when I default, it will be purely out of necessity.

  64. jamil says:

    62 Yo’me Your opinion-ed from hard core marxist Robert “Third” Reich stating that “Health-care reform is an important step forward but it’s not nearly enough”

    Yeah, baby. I’m sure for them nothing short of 100% marxism is not enough. Think of out of touch liberal idiots outside WH and Reich is probably one of the first to come to my mind..

  65. Yo'me says:

    In the late 1970s, the richest 1 percent of American families took in about 9 percent of the nation’s total income; by 2007, the top 1 percent took in 23.5 percent of total income.

    Today the top 5% takes in 67% of the nation’s total income.For decades the middleclass has been being screwed.The bailout is not about the banks,it is about the investors that the government don’t want to get burn.Regressive policies is what put us in this situation.Trickle down economy is the GOP mantra since Reagan and look at the disparity in income now.If I the middleclass can get back at them by defaulting,getting a loan modification or getting a forbearance,I will put aside morals.Policies like SS,medicare and other social programs even out the playing field for the middleclass decades ago.What will it take to even it out now?A low wage person can not afford nutritious meal or some times being given to choose to buy between medication or food,will not live as long as the can afford.Yet the elite wants to increase the age to collect SS.The can afford will live longer than the can afford.Guess what?That ball is on their court again.You say they don’t need it,they have all the money.”It is not about the money,it is the excitement of winning”.

    I hope I have better things to vent out next years .Happy labor day everybody!!

  66. Mr Hyde says:

    Could some help me out with an address for the following?

    MLS #2776635

    Thank you

  67. scribe says:

    wtf,

    Actually, my super is a woman, who lived across the hall from the evictee for more than 20 years. We both had our problems with her trying to mouch off us. She certainly believed she was going to get stimulus money, and had a social worker, who presented a plan in court.

    And thanks so much for calling me a moron. See ya at the next real-time GTG, I’m sure.

  68. crossroads says:

    Doom

    your right it will have had to hit the fan for me to default. my original plan was to let housing fall put the biggest down payment(sold in 06) on a home for the smallest monthly payment. Now I’ll hold on to as much $ as I can and let the bank and Government worry if I’ll make next months payment I won’t have that worry if it gets that bad I know I have the 1-2 year default plan

  69. Yo'me says:

    Jamil
    “Third” Reich stating that “Health-care reform is an important step forward but it’s not nearly enough”

    If the cost of health care in the US is the same amount as one of the developed countries .Medicare will have surplus just like SS

  70. Essex says:

    47. When I first came here I had a modicum of respect for bankers and those who worked in the financial services industry. Not any more.

  71. Essex says:

    Jamil — the country has been hammered by a very long line of leaders who have sold us out. You would be wise to study history and not simply parrot the things you hear on Fox.

  72. stillrenting says:

    I am sure most of us agree to let it crash.

    From the NYT

    Grim choice: Help today’s homeowners or tomorrow’s?
    Some experts urge a dose of shock therapy: Let the housing market crash.
    By DAVID STREITFELD
    updated 9/6/2010 12:35:22 AM ET

    The unexpectedly deep plunge in home sales this summer is likely to force the Obama administration to choose between future homeowners and current ones, a predicament officials had been eager to avoid.

    Over the last 18 months, the administration has rolled out just about every program it could think of to prop up the ailing housing market, using tax credits, mortgage modification programs, low interest rates, government-backed loans and other assistance intended to keep values up and delinquent borrowers out of foreclosure. The goal was to stabilize the market until a resurgent economy created new households that demanded places to live.

    As the economy again sputters and potential buyers flee — July housing sales sank 26 percent from July 2009 — there is a growing sense of exhaustion with government intervention. Some economists and analysts are now urging a dose of shock therapy that would greatly shift the benefits to future homeowners: Let the housing market crash.

    When prices are lower, these experts argue, buyers will pour in, creating the elusive stability the government has spent billions upon billions trying to achieve.

    “Housing needs to go back to reasonable levels,” said Anthony B. Sanders, a professor of real estate finance at George Mason University. “If we keep trying to stimulate the market, that’s the definition of insanity.”

    The further the market descends, however, the more miserable one group — important both politically and economically — will be: the tens of millions of homeowners who have already seen their home values drop an average of 30 percent.

    The poorer these owners feel, the less likely they will indulge in the sort of consumer spending the economy needs to recover. If they see an identical house down the street going for half what they owe, the temptation to default might be irresistible. That could make the market’s current malaise seem minor.

    Caught in the middle is an administration that gambled on a recovery that is not happening.
    “The administration made a bet that a rising economy would solve the housing problem and now they are out of chips,” said Howard Glaser, a former Clinton administration housing official with close ties to policy makers in the administration. “They are deeply worried and don’t really know what to do.”

    That was clear last week, when the secretary of housing and urban development, Shaun Donovan, appeared to side with current homeowners, telling CNN the administration would “go everywhere we can” to make sure the slumping market recovers.

    Mr. Donovan even opened the door to another housing tax credit like the one that expired last spring, which paid first-time buyers as much as $8,000 and buyers who were moving up $6,500. The cost to taxpayers was in the neighborhood of $30 billion, much of which went to people who would have bought anyway.

    Administration press officers quickly backpedaled from Mr. Donovan’s comment, saying a revived credit was either highly unlikely or flat-out impossible. Mr. Donovan declined to be interviewed for this article. In a statement, a White House spokeswoman responded to questions about possible new stimulus measures by pointing to those already in the works.

    “In the weeks ahead, we will focus on successfully getting off the ground programs we have recently announced,” the spokeswoman, Amy Brundage, said.

    Among those initiatives are $3 billion to keep the unemployed from losing their homes and a refinancing program that will try to cut the mortgage balances of owners who owe more than their property is worth. A previous program with similar goals had limited success.

    If last year’s tax credit was supposed to be a bridge over a rough patch, it ended with a glimpse of the abyss. The average home now takes more than a year to sell. Add in the homes that are foreclosed but not yet for sale and the total is greater still.

    Builders are in even worse shape. Sales of new homes are lower than in the depths of the recession of the early 1980s, when mortgage rates were double what they are now, unemployment was pervasive and the gloom was at least as thick.

    The deteriorating circumstances have given a new voice to the “do nothing” chorus, whose members think the era of trying to buy stability while hoping the market will catch fire — called “extend and pretend” or “delay and pray” — has run its course.

    “We have had enough artificial support and need to let the free market do its thing,” said the housing analyst Ivy Zelman.

    Michael L. Moskowitz, president of Equity Now, a direct mortgage lender that operates in New York and seven other states, also advocates letting the market fall. “Prices are still artificially high,” he said. “The government is discriminating against the renters who are able to buy at $200,000 but can’t at $250,000.”

    A small decline in home prices might not make too much of a difference to a slack economy. But an unchecked drop of 10 percent or more might prove entirely discouraging to the millions of owners just hanging on, especially those who bought in the last few years under the impression that a turnaround had already begun.

    The government is on the hook for many of these mortgages, another reason policy makers have been aggressively seeking stability. What helped support the market last year could now cause it to crumble.

    Since 2006, the Federal Housing Administration has insured millions of low down payment loans. During the first two years, officials concede, the credit quality of the borrowers was too low.

    With little at stake and a queasy economy, buyers bailed: nearly 12 percent were delinquent after a year. Last fall, F.H.A. cash reserves fell below the Congressionally mandated minimum, and the agency had to shore up its finances.

    Government-backed loans in 2009 went to buyers with higher credit scores. Yet the percentage of first-year defaults was still 5 percent, according to data from the research firm CoreLogic.

    “These are at-risk buyers,” said Sam Khater, a CoreLogic economist. “They have very little equity, and that’s the largest predictor of default.”

    This is the risk policy makers face. “If home prices begin to fall again with any serious velocity, borrowers may stay away in such numbers that the market never recovers,” said Mr. Glaser, a consultant whose clients include the National Association of Realtors.

    Those sorts of worries have a few people from the world of finance suggesting that the administration should do much more, not less.

    William H. Gross, managing director at Pimco, a giant manager of bond funds, has proposed the government refinance at lower rates millions of mortgages it owns or insures. Such a bold action, Mr. Gross said in a recent speech, would “provide a crucial stimulus of $50 to $60 billion in consumption,” as well as increase housing prices.

    The idea has gained little traction. Instead, there is a sense that, even with much more modest notions, government intervention is not the answer. The National Association of Realtors, the driving force behind the credit last year, is not calling for a new round of stimulus.

    Some members of the National Association of Home Builders say a new credit of $25,000 would raise demand but their chances of getting this through Congress are nonexistent.

    “Our members are saying that if we can’t get a very large tax credit — one that really brings people off the bench — why use our political capital at all?” said David Crowe, the chief economist for the home builders.

    That might give the Obama administration permission to take the risk of doing nothing.

    This story, headlined ” Housing choice: Help today’s owners or future buyers,” first
    appeared in The New York Times.

    http://www.msnbc.msn.com/id/39022112/ns/business-the_new_york_times

  73. gary says:

    Another clutered mess listed at $629,000. A bilevel, no less, with a kitchen from 1980 to go with the dreadful mite infested rugs and bland interior. And is that a hot tub on that deck that looks like an oil rig platform? Ugh! What a waste. That in itself reduces the value. Who the f*ck uses hot tubs? Who wants to stare at a bunch of fat f*cks who look like a dozen Sabrett hot dogs in a steaming pot of water with the oil slick sheen on the top! I would love to see the price history on this one. They are $200,000 overpriced. I’d offer $425,000 and that’s doing them a favor.

    http://www.realtor.com/realestateandhomes-detail/Waldwick_NJ_07463_1118841065

  74. Mr Hyde says:

    Still renting

    there is no choice. O needs votes and tomorrows home owners are t voting today. Therefore the only option is to bail out todays homeowners

  75. gary says:

    Was listed at $645,900 and went down to $639,900. What’s the point? They’re underwater, no doubt.

    http://www.realtor.com/realestateandhomes-detail/7-S-Dow-Ave_Waldwick_NJ_07463_1119073288

  76. Xroads says:

    Hyde
    Pols are kowtowing to the boomers that huge voting block who are underwater and unprepared for retirement
    I can’t believe it took the times 4 years to write that article. Wtf

  77. leftwing says:

    Today’s edition of the NJRE Non-Sequitur, Tautology, and Unintended Consequences watch:

    “The rich spend a much smaller proportion of their incomes than the rest of us. So when they get a disproportionate share of total income, the economy is robbed of the demand it needs to keep growing and creating jobs.”

    Correct premise that does not support the conclusion.

    The rich do in fact spend a smaller proportion of their incomes. To conclude, however, that disproportionately distributed income ‘robs’ economic growth, one must believe that proportionately distributed income benefits economic growth which ignores the ancillary effects of redistribution on the total wealth of the economy.

    Such logic has been considered before. In the early days of the Third Reich it was posited that by destroying municipal infrastructure the population would be made better off as rebuilding the infrastructure would create employment.

    Wealth cannot be increased by its destruction.

  78. jamil says:

    “Wealth cannot be increased by its destruction.”

    well, zero never claimed to increase wealth or grow anything. The goal is to redistribute wealth, based on fairness.
    You know, “now is not the time for profits” by zero himself.

  79. Satara says:

    If 45% of working class americans were classified as poor and did not pay federal taxes.Will it not be better,if their income and living standard is uplifted.Now they can pay their fair share of taxes,lessening the burden to the top income tax payer.Ford increase the salary of his workers,so they can afford what he sells.Why just make the elite your target.

  80. Cindy says:

    Labor Day = Donation Day for Grim

  81. Mr Hyde says:

    Leftwing

    law of conservation of wealth?

    In a global macro system wealth can niether be created or destroyed only concentrated or redistributed. While at the micro/local scale wealth appears to be created and destroyed but only due to wealth flowing between the various micro systems within the greater macro system
    similiar to mass conservation said law would not be inviolate in all situations

  82. Essex says:

    82. Define redistribute wealth without googling it Jamil. Yes, Paulson and Bush spearheaded the largest redistribution of wealth ever in the history of the planet.

  83. Essex says:

    Obama rubber stamped the plan and passed it along. That’s when he lost my support. So in essence he’s a helluva lot more like your guy than he is like mine. I would have let the banks choke.

  84. Essex says:

    83, Flat tax is the answer.

  85. Essex says:

    71. Makes sense and probably what people would do in worst case scenarios. Beats the heck out of paying someone at the closing table to buy your home. Also takes a lot of needless worry and sales cycles out of the whole deal. After that simply torch the place. Dunzo.

  86. Essex says:

    The New New Jobless…..”When they return from Iraq or Afghanistan, America’s military veterans must confront a new enemy – the dismal job market. Adrienne Mitchell headed to the economic frontlines and talked with vets, recruiters and companies looking to hire. Listen to their challenges and struggles in this special Labor Day Weekend edition of MarketWatch News Break”

  87. grim says:

    Thanks Cindy!!

  88. Anon E. Moose says:

    Leftwing [7];

    Congratulations, you broke your cherry! You are now what conservatives call ‘a liberal who’s been mugged’, i.e., a conservative.

  89. Final Doom says:

    sx (73)-

    There are an awful lot of good community bankers and guys who do the business on a smaller than TBTF level.

    Too bad that the TBTF crowd has targeted them for takeover/extinction. Too much of a risk to have competent competitors when somebody figures out that if the TBTFs are ever allowed to fail, the good small operators can scale up and take their business.

  90. Essex says:

    7. Thanks for sharing your thoughts. We each have our own journey. Keep on smilin!

    http://www.youtube.com/watch?v=tg0BNTebcbY

  91. Final Doom says:

    sx (87)-

    Bojangles is GWB in blackface. A modern-day Al Jolson, if ever there was one.

    http://www.culturemagazine.ca/joyentsite/images/Disguise/seabrook.jpg

  92. Final Doom says:

    sx (90)-

    Have faith that TPTB will soon identify new enemies to kill, then send them there to do the job.

  93. Anon E. Moose says:

    Yikes [25];

    I read it, and concluded that it was most likely written whilst lying on the beach under the shade provided by a George Soros bought and paid for umbrella. Pot, Kettle, etc.

  94. Final Doom says:

    My memory may be failing me, but I believe there are outstanding warrants against Maradona in Naples.

    If he goes, he should probably also hire someone to keep him from falling into a pile of blow, like Tony Montana.

    NAPLES, Italy — “Diego Maradona wants to celebrate his 50th birthday next month by playing in a game with his old Napoli teammates in the San Paolo stadium.

    Maradona told Monday’s Gazzetta dello Sport that “I’ve had everything in life: a family that I adore, a brilliant career, and now thank god I don’t need anything, not even money. My only desire is to return to Naples.”

    Maradona turns 50 on Oct. 30. He led Napoli to Serie A titles in 1987 and 1990 and the 1989 UEFA Cup title.

    Maradona has asked his former Napoli teammate Salvatore Bagni to organize the birthday game.

    Maradona’s contract as Argentina coach was not renewed after the squad lost to Germany in the World Cup quarterfinals.”

  95. jamil says:

    85 hyde: “In a global macro system wealth can niether be created or destroyed only concentrated or redistributed”

    I have to call BS on this. Take a look at the world, including average American (and average third-worlder).
    Everybody, including poor Americans and third-worlders now live longer than ever (thanks to advanced medical innovations made available to everybody, thanks to the wealth created by BigPharma and enjoyed by everybody) .
    Also, if they want, even poor people have great things available (cellphones, Internet, international travel, and most importantly, better food and medicine) unlike ever before. Poor people in Africa have vaccinations. They have cellphones (so they can sell their products to highest bidder in nearby towns). Middle-class people in China have cars.
    Compare your average American J6P’s quality of living in the 1950’s (or anytime you wish) with today’s J6P quality of living with all those ipod, iphones, college education and vacations in Hawaii.

    The amount of wealth created has been enormous and benefited pretty much everybody in the world.

    The reason why third-world (e.g. China, India) have benefited more than US is simple: They got rid of so-cialism, and adopted capitalism. Of course, the US is going the other way, from capitalism toward socia-lism so our living qualities will go down as a result (but that is a voluntary choice of the US, or at least the ruling class).

  96. Final Doom says:

    Jamil is like a right-wing Robert Reich: diagnose the problem correctly, but crash-and-burn on coming up with the cure.

  97. Shore Guy says:

    “Flat tax is the answer”

    Amen, brother. And no deduction for mortgage interest, etc.

  98. cobbler says:

    hyde [77]
    Unfortunately, residential RE is a very substantial part of the wealth of the country, especially after the productive industry had been largely destroyed. Thus, the price freefall which will likely result if all supports are removed will trigger a general collapse of the economy and very quickly bring us to the per capita income and income distribution of Brazil or similarly developed country. Supports, delays, etc. will still make us go there, but within an extended period of time, and hopefully within this time Brazil will be moving upwards – so we end up a bit higher than in the collapse case. Again, I have a strong protectionist/anti free-trade bias – I think we’d be able to overcome most of the problems by forcing the production back home. This, in turn, will stop the erosion of the middle class, result in a meaningful inflation which will mitigate the RE issues in a few years, and stop/reduce our dependence on the countries that at best don’t care about us and at worst hate us. The negative is the general reduction of the material consumption per capita that will ensue (for the same $$ you will be able to buy less of U.S.-made stuff than of the Chinese-made). However, we are going to get this if not greater reduction anyway – just the way things are going now it will be skewed towards the [former] middle and lower classes.

  99. Final Doom says:

    Jamil, most of the US progress you cite is not due to creation of wealth, but extension of credit, coupled with mispricing of risk. Captitalism- as a system- is fine, but we stopped practicing it in about 1913.

    We are experiencing contraction in the economy first and foremost because our national balance sheet is shot, fiat paper is coming to an end and application of monetary stimulus is like transfusing the dead.

    The US has been a soci@list nation for at least since FDR. The only open question is whether our fascist-tinged version is superior to the cry-ass, weepy version practiced in Europe.

    In the end, it doesn’t matter, since both continents are totally insolvent.

  100. Shore don't like robot posters Guy says:

    Much good posting information for to make good decisions.

    Please to make the quality continue.

  101. Final Doom says:

    cobbler (102)-

    Can you change your handle to Smoot-Hawley?

  102. Shore Guy says:

    BTW, when did a nice family sedan start costing $60,000+? Talk about absurd prices. (Maybe we will just buy a tricked out 7 series BMW and use it as a vacation home, thus killing two birds with one stone).

  103. Shore Guy says:

    Mybe the Amish are onto something, at least as far as transportation is concerned.

  104. Shore Guy says:

    maybe, even

  105. Essex says:

    99. “….The amount of wealth created is enormous and has benefited nearly everyone in the world….” Yeah. Tell that the anyone who worked at a major corporation where some cretin was brought in to merge/purge all while earning millions. Yep. That was great.

  106. Essex says:

    106. I always liked the corvette. Yet, when GM started selling them for premium prices all I could afford was the Camaro. Just not the same.

  107. cobbler says:

    doom [105]
    Smoot-Hawley was a stupid legislation because it was (a) adopted when the U.S. was a net exporter (like China is today) – thus, when the partners retaliated the U.S. was damaged harder than they, (b) it largely aimed at the industries that didn’t need protections – e.g. agriculture, and (c) it was exclusively tariff-based rather than non-tariff restrictions that are working so well for e.g. South Korea.

  108. Yikes says:

    as predicted, the radical right pushed this aside and moved forward w/ their agenda. as usual, the radical right can’t have a discussion about one topic without shifting it to something else. forget your facts, I’ve got mine!

    who are you, Sean Hannity?

    Yikes says:
    September 5, 2010 at 3:53 pm

    wonder how angry Jamil will get when he read this.

    The Koch brothers …

    http://www.newyorker.com/reporting/2010/08/30/100830fa_fact_mayer

  109. Yikes says:

    gonna recommend this again. great read

    http://www.nytimes.com/2010/09/03/opinion/03reich.html?pagewanted=all

    In the late 1970s, the richest 1 percent of American families took in about 9 percent of the nation’s total income; by 2007, the top 1 percent took in 23.5 percent of total income.

    The rich spend a much smaller proportion of their incomes than the rest of us. So when they get a disproportionate share of total income, the economy is robbed of the demand it needs to keep growing and creating jobs.

    What’s more, the rich don’t necessarily invest their earnings and savings in the American economy; they send them anywhere around the globe where they’ll summon the highest returns — sometimes that’s here, but often it’s the Cayman Islands, China or elsewhere. The rich also put their money into assets most likely to attract other big investors (commodities, stocks, dot-coms or real estate), which can become wildly inflated as a result.

  110. Comrade Nom Deplume aux maison says:

    [107] shore

    I had, at one time, considered the Lancaster area for the nompound, but it did not meet enough of the nompound criteria.

    The idea of keeping horses for future transportation I had considered, but that has a host of logistical issues, as in I know nothing about keeping horses, and it would likely be too difficult and expensive unless I was going to ride currently. Ideally, if you have the space and facitilities, you permit others to board their horses with you, thus insuring access in the event such transport becomes the norm.

  111. Essex says:

    114. A bicycle makes sense.

  112. cobbler says:

    nom [114]
    Most of the developing world uses motorbikes for transportation, me personally watching families of 5 riding one… An 80 cc piece does about 200 mpg (with 1-2 ppl), so if you bury one 55 gal drum of gas it will last you for many years (need to add the anti-aging stuff, though). Also, some bike engines – not 2-cycle though – could be fairly straightforwardly switched to ethanol (moonshine) for fuel. To carry moderate sized loads you are better off with the donkey than a horse – eats less, lives longer, generally, healthier. Also, has a bigger @#$% if you care.

  113. spyderjacks says:

    101 : ShoreGuy – The flat tax is already in place, with no mortgage deduction. It’s called AMT (Alternative Minimum Tax). Apparently, it only applies to the middle class.

    I define “middle-class” as still-a-wage-earner but with insufficient assets to qualify for the really good deductions that the ‘real’ rich folks get.

    I’m not feeling any job or financial pain. I dream of a nompound but still like my MTV. I’m done with the stock market and have a nice down-payment… waiting to pick up mad-as-hell-reinvestor101’s castle at 1998 prices. I figure if I can get a mortgage again… then I’ll be in a better position for some really free money ;-)

  114. jamil says:

    109 essex
    So you are saying that people were not laid off (and were as a result, facing poverty) until in recent years? Talk about being clueless.

  115. Comrade Nom Deplume aux maison says:

    [102] cobbler

    “I think we’d be able to overcome most of the problems by forcing the production back home. This, in turn, will stop the erosion of the middle class, result in a meaningful inflation which will mitigate the RE issues in a few years, and stop/reduce our dependence on the countries that at best don’t care about us and at worst hate us. The negative is the general reduction of the material consumption per capita that will ensue (for the same $$ you will be able to buy less of U.S.-made stuff than of the Chinese-made).”

    Agree with everything except the nondependence stuff. And forget about exporting anything. All manuf. will be for domestic consumption, meaning you don’t really cure the current accounts imbalance.

    [116] cobbler

    I don’t know what the donkey’s $#@& is, and I am not sure I want to find out.

  116. Essex says:

    118. Nope. I am saying that until the last 15 years, CEOs made money but not the type of massive compensation that they enjoy today. The elites were being richly rewarded for selling the middle class down the river. Got it now?

  117. Confused in NJ says:

    They should move Labor Day to India & China, which is where all the jobs are now. Over here they can rename it Jobless Day.

  118. jamil says:

    essex: yep, thank god we did not have rockefellers, fords or billgates’ in the golden era. All those coal and oil barons were Friends of the Middle Class, too.

  119. Essex says:

    Yep. thank gawd jamill. Thank gawd.

  120. Mr Wantanapolous says:

    “What’s more, the rich don’t necessarily invest their earnings and savings in the American economy; they send them anywhere around the globe where they’ll summon the highest returns — sometimes that’s here, but often it’s the Cayman Islands, China or elsewhere. The rich also put their money into assets most likely to attract other big investors (commodities, stocks, dot-coms or real estate), which can become wildly inflated as a result.”

    Yikes,

    Same as it ever was. Capital flows to where its treated best. Why invest in the US economy at this time? BP rigs have a much stronger foundation than this social engineered project.

  121. Anon E. Moose says:

    [last try to get through the filter, take 3]

    Gary [78];

    Some [beverage] waitress-[turned]-realtorette apparently [persuaded] the owner that a “price reduction” would generate “[interest]” for the listing, regardlesss of the amount.

    I look at ANY listing with at least 10% off the top. I can’t believe that there’s a house buyer out there who thinks they’re shopping in WalMart and the sticker price is what you have to pay; who doesn’t believe that at least 2-5% is within the range of negotiation. So a seller who lobs a “price reduced” onto MLS with a reduction of less than 2% (consider the scuba diver in Waldwick who knocked 6k off a $650,000 listing), is just [urinating] in the wind.

  122. cobbler says:

    nom [119]
    You will be surprised on the exports: e.g. for many large-volume chemical products, metals, paper, etc. the only reasons China production is winning are their export rebates and energy subsidies – so if we could compete on an even flooring we have a decent chance of winning. Also, when the industry begins to move out all the support structure gradually falls apart, so even the production plants that are competitive will have to close down at some point (if you need a month to have a pump repaired, and you have to ship it half-way around the world for that, you are a goner). It works other way around, as well – when an industrial cluster with its infrastructure is re-created, many things suddenly become feasible.

  123. Yikes says:

    Anon E. Moose says:
    September 6, 2010 at 11:24 am

    Yikes [25];

    I read it, and concluded that it was most likely written whilst lying on the beach under the shade provided by a George Soros bought and paid for umbrella. Pot, Kettle, etc.

    You sure you read it? Soros was mentioned. And ripped.

  124. jamil says:

    Yikes 113 “What’s more, the rich don’t necessarily invest their earnings and savings in the American economy; they send them anywhere around the globe where they’ll summon the highest returns ”

    Surprise that you read NY Slimes again and again /sarc
    Anwyay, everybody invest where it is safest and most profitable. For example, rule of law used to be applied in the US.
    Today, (see, for example, Chrysler senior bondholders who foolishly trusted the rule of law) the rule of law in the US is not anymore better than elsewhere so that benefit has been destroyed. Feelings and public interest (whatever it means) trump the rule of law in the US.

  125. Yo'me says:

    “What’s more, the rich don’t necessarily invest their earnings and savings in the American economy; they send them anywhere around the globe where they’ll summon the highest returns ”

    Again policies like this that benefits the top earners,paying 15% capital gains tax on an investment that the americans are cheated.That is if the account name is not an alias

  126. Shore Guy says:

    ” It’s called AMT (Alternative Minimum Tax)”

    Oh, I know the AMT. We have been getting AMTed for years, without a kiss and without lubrication.

  127. Juice Box says:

    Happy Labor Day Comrades!

    I am slow grilling some dry rubbed Baby Back Ribs on my deck this afternoon and soaking up some rays.

    Cheers!!!

  128. Essex says:

    I feel safer at night knowing that patriots like Jamil are drinking the koolaide!

    Here’s to another war soon! They cannot spend money fast enough on a good war.

  129. House Whine says:

    132- Yeah, as long as they don’t have to actually go and fight in it?

  130. jamil says:

    Essex, I feel for you when you are fantasizing the good old days of 1920’s when the nice and friendly railroad/coal/oil barons were running the corporations giving the working man great security and benefits.
    Also, I’m sure you would love to take a job in some coal mine in the 1950’s when things were great for the average joe sixpack.

    Exhibit A for delusional, out of touch liberal, may I present Essex!

  131. jamil says:

    whiner: “132- Yeah, as long as they don’t have to actually go and fight in it?”

    yeah, if you are not a front-line soldier yourself, you are not allowed to have a position that advances US interests.
    Using your argumentation, are you allowed to eat wheat if you are not ready to be a farmer yourself? Chicken wings?
    besides, i went to army.

  132. Final Doom says:

    Jamil = entropic tedium generator

  133. Comrade Nom Deplume aux maison says:

    [126] cobbler,

    Respectfully, I disagree. We can compete on productivity, innovation and quality, but for commodity goods, our cost structure will be so high as to make our goods unsaleable in the rest of the world. Our prior dominance in decades past was due in no small part to a lack of meaningful competition, and export booms in certain industristes was due to innovation (which is eventually commoditized).

    If we throw up barriers, we make a market for domestic goods. That’s a given, but the resulting price inflation driven by higher labor unit costs will exacerbate our cost disadvantage. We essentially return to the days of Zenith and Motorola making TVs, and our cars will come from Detroit. In other words, we go back to the 70’s.

  134. House Whine says:

    135- good for you. I just met too many gung-ho for the war people around here who were so willing to let others sacrifice. You know, the upper middle-class doesn’t need any skin in the game. Carry on.

  135. Al "The Thermostat" Gore says:

    7.

    Left Wing,

    Great post. Good that you have seen the light. My only disappointment is that you dont get mad. Its all a big motherf_cking fraud. I have rope and I pray that one day I wake up and America has developed into a flash mob hell bent on revenge.

  136. Al "The Thermostat" Gore says:

    “If the cost of health care in the US is the same amount as one of the developed countries .Medicare will have surplus just like SS”

    Dumb dick. You are going to die an early death and you are too naive to know it. Your problem not mine. Im already inside the system.

  137. yo'me says:

    A union-free America. Growth down a little, employment down a lot. Profits and productivity up, wages flat. Health-care costs up for workers, down for employers. The return of a thriving middle class? Dream on.

    http://www.washingtonpost.com/wp-dyn/content/article/2010/09/05/AR2010090502815.html

  138. yo'me says:

    At least 15.3% of the population is completely uninsured,[1][2][3] and a substantial additional portion of the population (35%) is “underinsured”, or not able to cover the costs of their medical needs.[4][5] More money per person is spent on health care in the United States than in any other nation in the world,[6][7] and a greater percentage of total income in the nation is spent on health care in the U.S. than in any United Nations member state except for East Timor.[7] Despite the fact that not all citizens are covered, the United States has the third highest public healthcare expenditure per capita.[8][9] A 2001 study in five states found that medical debt contributed to 62% of all personal bankruptcies.[10] Since then, health costs and the numbers of uninsured and underinsured have increased

    http://en.wikipedia.org/wiki/Health_care_in_the_United_States

  139. jamil says:

    yome “Health-care costs up for workers, down for employers”

    This is BS. The cost of HC for employers goes up a lot every year, usually double-digits.
    The companies try to cope with this by introducing more limits and exclusions (and passing some costs to the employees).

    One major reason why HC is expensive here is malpractise which does not exist outside of US.
    For example, malpractise insurance can be $200,000 for a surgeon before any operation. Another consequency is that being a part-time doctor or charity case provider is almost impossible (as is being in some risky practise areas).
    Also, why the heck insurance is 25% more expensive in NJ than in OH? Why can’t people in NJ buy insurance from OH?

  140. cobbler says:

    nom [137]
    For many commodity goods labor expense represents less than 5% of the overall cost, and in some cases less than 1% (e.g. processing of the crude into gasoline, diesel, etc.). The only 2 reasons it is cheaper to bring many bulk chemicals from China than to make them here are export rebates and energy subsidies over there (which more than overcompensate a puny 1.6% or so tariff we impose) – this is for the offshored U.S. company. For a Chinese company, the extra advantage is from them willing to take 4% profit margins for as long as it takes to drive the competitors out of business and get credit from the state-owned bank at the interest rate yet lower than that. Again, the competition is rigged.

  141. Revelations says:

    Hyde @ 27
    What is an FDA loan? Do you mean USDA (for rural housing)?

  142. Revelations says:

    Incidentally, I was looking up the difference between the USDA Direct and Guaranteed loan types and came across this site (ignore the main content and jump right to the 1st comment… Is this is who the gov’t is giving No-Money-Down loans to?):

    http://www.realtown.com/pauldunn/blog/usda-guaranteed-home-loan-or-usda-direct

  143. Shore Guy says:

    Finally but, duh!

    http://articles.latimes.com/2010/sep/05/business/la-fi-america-unemployment-mainbar-20100905

    For many unemployed workers, jobs aren’t coming back
    The U.S. unemployment rate will remain elevated for years, experts say, a grim prospect for Americans who have exhausted their benefits.
    America Out of WorkSeptember 05, 2010|By Alana Semuels, Los Angeles Times

    The U.S. economy will eventually rebound from the Great Recession. Millions of American workers will not.

    What some economists now project — and policymakers are loath to admit — is that the U.S. unemployment rate, which stood at 9.6% in August, could remain elevated for years to come.

    The nation’s job deficit is so deep that even a powerful recovery would leave large numbers of Americans out of work for years, experts say. And with growth now weakening, analysts are doubtful that companies will boost payrolls significantly any time soon. Unemployment, long considered a temporary, transitional condition in the United States, appears to be settling in for a lengthy run.

    [snip]

  144. Revelations says:

    Also, for the take-a-zero-down-mtg-as-insurance-and-keep-the-dp crowd, what kind of numbers are you crunching? I’ve spent a decent amount of time trying to figure out ways to protect myself in a RE transaction in this f’d up market/policy enviroment.

    Say you take out a zero down loan of $400K. Your annual payments, depending on your bracket (for mtg deduction) and int rate, will likely be between $20K-$30K. I’d assume that if your doing this, you’re pretty bearish on the markets and economy at large, so you’d want your $400K dp somewhere pretty safe (even FDIC insured). Even finding something these days at 2-3% AFTER taxes will get you $8K-$12K back. So on a $400K house, you will be incurring an annual loss of somewhere between $8K to $22K anyway (a loss of 2-5% of the house value annually).

    So if rates don’t do anything drastic, you’ll make up for any home equity losses with savings from no interest payment. Of course, the hyperinflation scenario complicates this, but I’m thinking one be better off with that $ in real property vs cash or other liquid assets trying to chase yields with inflation in the booster stage.

    Just my 2 pence. I’m open to new ideas.

  145. Mocha says:

    Suddenly I have deeply confusing feelings surrounding my negative feelings towards unions and my concern over the dwindling middle class.

  146. still_looking says:

    Happy Birthday O Grim One.

    sl

  147. Qwerty says:

    Best way to jump start a high-tech economy in the 21st century? Spend $50 Billion employing road workers.

    WASHINGTON (AP) – Vowing to find new ways to stimulate the sputtering economy, President Barack Obama will call for long-term investments in the nation’s roads, railways and runways that would cost at least $50 billion.

    http://apnews.myway.com/article/20100906/D9I2DUV01.html

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