From HousingWire:
Principal forgiveness may not be the silver bullet for housing: S&P
The attorneys general settlement proposal to major servicers includes a push for more principal forgiveness on delinquent mortgages. But it may be one of the initiatives cut when banks decide to push back.
Following an investigation into foreclosure practices, the 50 state AGs submitted their “opening bid” in settlement discussions, which includes a slew of new requirements. Dual-track loss mitigation — pursuing a foreclosure case at the same time as a loan modification — would end, and modification attempts would be mandatory, among other new rules.
Analysts at Standard & Poor’s sounded off on the proposal in a report released Friday. While many of the proposals would obviously benefit delinquent homeowners, investors and servicers in the short-term at least would see losses mount as the foreclosure process extends even further.
“Servicing costs and workloads may significantly increase at a time when servicers are inundated and operating under cost constraints,” S&P said. “Many servicers/originators may attempt to pass an increase in costs to borrowers through higher mortgage rates.”
Analysts said principal forgiveness could reduce those losses for investors if the borrower remains current afterward. And home prices, too, could begin to rebound if there are fewer foreclosures entering the shadow inventory supply. However, the obstacles to such an initiative may prove too daunting.
…
“The moral hazard (strategic default issue) must be addressed by first recognizing it as an economic issue, not a moral one,” S&P analysts wrote in a research note issued Friday. “The costs of default must be made explicit.”However, Standard & Poor’s said too many homeowners may be too far underwater. In order to bring more borrowers in negative equity – meaning they owe more on the mortgage than the home is worth – back to the surface could require a reduction between 25% and 30%. In some markets where home prices have been cut in half, like Las Vegas, reductions may need to be in the 50% to 70% range.
“The amount of principal forgiveness needed to re-equitize borrowers and/or lower their monthly payments to an affordable level may be beyond the currently contemplated principal forgiveness amounts,” S&P said.
Such an offer could induce more borrowers to strategically default, and there is also the challenge of reducing a first-lien balance while a second-lien remains with another lender. S&P added that if a borrower redefaults after the principal forgiveness, the losses to the investor would be even harsher than if the servicer had foreclosed in the first place.
…
“Market participants have debated the value of principal forgiveness. Some cite concerns such as moral hazard, while others believe it’s a necessary step toward overcoming the housing crisis,” S&P said. “However, we also believe there may be a number of obstacles that may prevent principal forgiveness modifications from having a significant positive impact on the housing market and for RMBS investors.”
Good Morning New Jersey
From the Press of Atlantic City:
South Jersey property-tax bills rose 25 percent in 2010, largely because of delays and decreases in state aid
The average property-tax bill in southeastern New Jersey increased 24 percent in 2010, following reductions and delays in the state tax-relief program, data released earlier this month show.
The typical property-tax bill actually increased by 25 percent or more in 23 area municipalities — mostly smaller towns, but also including Millville and Dennis, Middle, Lower and Barnegat townships — an analysis by The Press of Atlantic City of Department of Community Affairs data shows.
DCA data show the average 2010 property-tax bill — including municipal, school and county taxes — was $4,709 for the 68 municipalities in Atlantic, Cape May, Cumberland, southern Ocean and Burlington counties. This represented an average increase of $170, or 4 percent, from 2009.
But when 2009 tax bills are adjusted to reflect property-tax relief paid that year to the typical homeowner, the increase in the average bill was 24 percent. Average area tax bills in 2010 were $1,080 higher than the net 2009 tax bills after rebate checks went out. The reason for the difference: The state did not send rebate checks in 2010. Gov. Chris Christie and the Legislature revamped the program to save the cost of issuing checks and will provide a credit instead.
Qualifying property owners — mostly senior citizens — will receive a credit for last year’s unpaid state tax relief on their property-tax bill this May. However, that credit will be for only 25 percent of the relief homeowners would get under a fully funded program, Treasury spokesman Andrew Pratt said, adding state officials plan to increase that level to 50 percent the following year.
Some area residents and officials said that is not enough.
“A lot of seniors are on fixed incomes and relied on those rebates to get by,” said Hank Gibney, 79, of Little Egg Harbor Township, Ocean County. “Without them, it’s a whole different ball game.”
In Little Egg Harbor, where many senior citizens live, the average property-tax bill increased from $4,259 in 2009 to $4,332 last year, an increase of about 2 percent. However, after the average local rebate of $914 lowered the net 2009 tax bill, the amount they paid in taxes actually increased $987, or 23 percent, in one year.
From CNN/Money:
13% of all U.S. homes are vacant
High residential vacancies are killing many housing markets, as foreclosed homes sit on the market and depress sale prices and property values.
And it’s only getting worse: The national vacancy rate crept up to just over 13% according to last week’s decennial census report. That’s up from 12.1% in 2007.
“More vacant homes equal more downward pressure on home prices,” said Brad Hunter, chief economist for Metrostudy, a real estate information provider.
Maine had the highest proportion of empty housing stock, at 22.8%. Other states with gluts of empty houses included Vermont (20.5%), Florida (17.5%), Arizona (16.3%) and Alaska (15.9%).
The way the census calculates the vacancy rates, however, is problematic. It includes properties such as ski lodges, beach houses and pied-à-terres that many real estate statisticians would not.
Housing Bailout – I’m Catholic and my faith requires that I forgive, but this also breaks one of my commandments which is Thou Shall Not Steal
The whole concept of Principal Forgiveness is Obscene.
Banks as corporate welfare-backed GSEs are an even worse concept.
From what I’ve read the amount will not be enough to get most of these people out of the woods. Payment going to go down a couple of hundred, lost cause give up already. This will prolong the agony and drag out the downturn even longer. You would think the gov. would have figured it out after the failure of all the other programs and the continuation of the housing downturn when markets are not allowed to clear.
Principal reductions. Yawn. Never work. Homes still way overpriced. Still too much debt. Still too few jobs. Basically just buying a few months for the same people to end up back in foreclosure.
“New Jersey home prices will not return to their recent peaks until 2020”.
– Jeffrey Otteau, of the Otteau Valuation Group
http://www.northjersey.com/realestate/118635129_Home_prices_have_long_climb_ahead.html
Principal forgiveness is the only answer, besides default. Investors and banks have to take a hit too though, or else its just another bailout.
Write down values by a lot, mark to market so that prices can match up to equilibrium naturally and then move forward from lower levels.
In order to bring more borrowers in negative equity – meaning they owe more on the mortgage than the home is worth – back to the surface could require a reduction between 25% and 30%. In some markets where home prices have been cut in half, like Las Vegas, reductions may need to be in the 50% to 70% range.
So, this means if you f*cked up, you get a pony and the others that acted in a financially responsible manner get to pay for the pony.
i guess the spring selling season is a bust ?
Veto 10 I have read the numbers , can not quote them but the amount they want to shave off these loans will not do it. I remember being incredulous that this guys even thought it would help. “A lot” not happening. Just another feel good useless program.
11, welcome to the era of O
Gary 11 agreed.
I want a pony! I want a pony!
freedy,
It isn’t a bust. It’s contained to subprime. Besides, we’re all affluent here.
jamil,
I heard the trick is to say the words, “let me be clear” before every statement and it becomes gospel.
Just get FK going.The faster this homeowners can put this behind them,the faster they can move forward.I feel sorry for people that loose their homes but 2 years not paying the mortgage is enough incentive to save enough and move on.Bulldoze and write it off.
Mike, If the write downs translate to the same reductions in market prices, it will help us find natural equilibrium at lower levels. Everyone gets a black eye and then new buyers/investors will see value.
“All real estate demand is driven by how many people have jobs,” Otteau said. “We’re a long way off from getting back to that vibrant housing market where sellers get to dictate the price.”
So, Mr. Otteau, what you’re saying is that buyers now dictate the price, correct?
Veto the market price is below the write down, wish I had the link on the numbers for the program.
Catch you later.
The end is nigh (Alternative Lifestyle Edition):
Harry & David Files for Chapter 11 Protection
I’ll agree with the Principal Correction if “O” goes after the original Sellers & reduces their Profit similar to what occurred to Investors who didn’t loose money in the Madolff Ponzi. Making me pay for the Pony versus the original Seller, is Obscene, because I am also paying for the original Sellers illgotten Pony.
Confused [25],
It’s called the win-win-lose model. It’s the new Amerikan business design for profit and growth. It’s when two parasitic entities suck the life from a defensless host at twice the rate of resistance.
FWIW, there are a lot of houses on the market in the brig. Some are languishing but some are moving quickly (or coming off). Don’t know what the price action is.
Otteau and Yun capitulating in the same week? Is the bottom here? Cue time magazine cover.
gary (21)-
Buyers? What buyers?
Here’s the mathematical formula for the business model I mentioned above. This is all you need in order to bilk, swindle, swipe and con your way to success:
2 to the (Nth power) + 2 to the (Nth power – 1) + 2 to the (Nth power – 2) divided by 2 to the (Nth power + 1) – 1
grim (28)-
No bottom in sight. Whatever form the “universal settlement” takes, it will have the effect of essentially putting the housing market into a deep, 50-100 year sleep.
Here’s the bulleted points of what I think will happen:
– Little-to-no principal writedowns. Any significant universal principal writedown would lead to an immediate drop in prices, which would impair MBS. Banks’ #1 fear is any action that would lead them to have to write down the current fantasy values of that paper. Remember, all the big banks are currently generating “profits” by reducing loan loss reserves. Basically, the banks and gubmint will collude to keep the nominal values and asking prices of RE at current levels…even if it means a further drop in sales volume and further pileup of shadow inventory.
– No significant change to foreclosure procedures/guidelines. In fact, I think the gubmint/bankster cabal has decided that the best they can do is pretend people are paying mortgages while allowing those who don’t pay to remain in their homes for years on end. The problem is kicked down the road, the cabal can continue to hope for some deus-ex-machina solution, and the housing inventory subject to delinquency does not suffer from even higher vacancy factors.
– My first two points lead to a situation in which young, first-time buyers begin to reject homeownership in overwhelming numbers. Seeing a zombie market, riddled with fraud- within which nothing can remotely be valued properly- will turn this massive group of potential buyers into renters and/or long-term fence sitters. In non-sand state markets, asking prices will remain high while those potential buyers essentially yawn and ignore them…thus, perpetuating the zombielike sales inactivity for at least a generation.
(51) (prior thread) fabius
Much clearer. Will examine when I am not juggling toddler and LLC filing. I think we still disagree on fundamental premise.
In other news, Bloomberg reports Mass says they detected rads from Japan in rainwater.
Gotta get toddler out of dog crate now. She loves to go in with the dog. Freaks me out a bit.
In short, the gubmint/bankster cabal will be crushed should anything happen that would force an acknowledgment of bad debt and a massive re-valuation of the collateral that underlies MBS.
Therefore, the current charade will be extended by any means necessary.
Time to tax the crap out of the poor. They’ve been coasting for too damn long.
http://www.nytimes.com/2011/03/27/business/27gret.html?ref=business
Rinse & Repeat?
“NOSTALGIA is running high on Wall Street for the days when junk mortgage underwriting and opaque derivatives trading juiced bank profits. As regulators continue to devise the machinery of the Dodd-Frank regulatory reform law, major financial institutions are working overtime in Washington to bring the good times back again.”
Bojangles’ primary minder (Daley) is a career Chicago political machine hack and lifetime toady of the banksters. This is hardly a coincidence. No move will be made on his part to do anything the banksters don’t condone 100%.
The quid pro quo for Bojangles will come in the form of giant campaign contributions that will ensure a second term (pardon me while I throw up in my mouth).
In retrospect, this will be studied as one of the great Amerikan political balancing acts of all time: posturing as a quasi-soci@list man of the people, while simultaneously being in the complete thrall of giant, corrupt banks.
toast (35)-
The good times are back, all right. The current Fed-induced bubble in fiat paper, and its subsequent detonation, will be the kill shot to our next 50-100 years.
Nom my niece barked for two years, refused to talk. Kidding, maybe she just identifies with the dog more than you, your wife and her siblings. Or just looks at the pooch as a big fluffy wooby.
Debt anyone who get principal forgiveness hsould have the letters tatooed in chartruese on their foreheads. WTF it is the end times anyway lets get the mark of the beast going. O’s second term is baked in or subservience to the fradualent banksters with it
#21 Gary – Buyers do dictate the price, just not the way you are presenting it. No buyers. No sales. Prices go down. It is a process, not an individual transaction. Collapse takes time…
Obama is no more or less evil than any that preceded him. When O was elected I told my friends, welcome to Bush with a tan!
Near me the bigger thing I see is younger couples opting for the second tier decent neighborhood and the 60×100 3 bed two bath split type home that is priced right.
The days of 2004/2005 lets skip the starter home and go right to mcmansion and take out massive debt is dead.
Near me the next door upscale neighborhood still has 80×100 four bedroom three bath homes for sale at 1.2 million with 22k in taxes rotting on market for one year plus but my town a 3 bed two bath well maintained home 8k in taxes for 375K will sell in a few weeks. Easy to do 20% down and get a confirming mortgage on a 375K home and electric and oil cheap. Those blown out white elephants are dead. You should be buying your first home at around 3x income. Plenty of dual working young couples newly married pulling down a joint 125k for the 375k home, not toom many for the 1.2 million home. Interesting the 1.2 million homes are being sold by 50ish/60ish couples to downsize as they home equity it and taxes are straight up. I look at a home like that and say won’t I be in same boat as you in a few years forced to sell a home at a loss to trade down? Plus the couple with the 375K home can add principal to pay down or refinance to a 15. You can do that with a low balance. With a 900K mortgage, paying a few extra bucks or an extra payment a year is like moving mount everest a pebble at a time.
– My first two points lead to a situation in which young, first-time buyers begin to reject homeownership in overwhelming numbers. Seeing a zombie market, riddled with fraud- within which nothing can remotely be valued properly- will turn this massive group of potential buyers into renters and/or long-term fence sitters. In non-sand state markets, asking prices will remain high while those potential buyers essentially yawn and ignore them…thus, perpetuating the zombielike sales inactivity for at least a generation.
jj (41)-
You are correct. However, the overall action in the market segment you describe is not enough to trigger a recovery in general.
It will also be interesting to see the reaction when that young couple buying at 375K today realizes in a couple of years that their shack investment is now worth barely 275K.
Early money is dumb money. The investors in my Rolodex are still on the beach, sipping fruity drinks. The only thing I get from them are “wish you were here” postcards and sympathy phone calls when we get a foot of snow.
I’m also pretty sure that a 3/2.5 split level POS at a value of 275K with a 11K property tax bill is the sign of the devil.
My first two points lead to a situation in which young, first-time buyers begin to reject homeownership in overwhelming numbers. Seeing a zombie market, riddled with fraud- within which nothing can remotely be valued properly- will turn this massive group of potential buyers into renters and/or long-term fence sitters. In non-sand state markets, asking prices will remain high while those potential buyers essentially yawn and ignore them…thus, perpetuating the zombielike sales inactivity for at least a generation.
JJ,
You have just described a strong argument why one should own multifamily buidlings over the next 10 years. I have just increased rents (I got the lip from everyone) but no one moved and everyone is current. In 12 months rinse and repeat.
JJ, (41)
Problem with high end homes in NJ is that few businesses with highly paid employees are choosing to locate in NJ. Why would they? A lot of the higher end houses in my area were built in the late 80s through late 90s. This is when pharma and technology was growing in the state. Lucent is now a flop, Alcatel probably running the show. Pharma is gradualy fading out, with biz being slowed by a tougher FDA, and pushed out by high costs and taxes. No new industries see NJ as land of opportunity, and NJ govt has pushed costs up such that they aren’t particularly cost competitive vs other tri-state suburbs for NYC workers.
Which is why I assume I’ll be selling my home for a loss someday, probably to some government employee, who will be the last ones to leave the state.
A. West and that won’t change until the graft, union thuggery and homerule BS are finally killed. There is no hope for my home state
Clot (43),
First, your place already exists and it’s named West Orange.
Second, are Stu, Grim and I the only buyers in the state? I held on as long as I could but with Avalon gettting ready to most likely jack up my rent another 8% to make it $2,500, buying didn’t seem so bad. It is what it is.
40.30 year realtor says:
March 28, 2011 at 8:37 am
Obama is no more or less evil than any that preceded him. When O was elected I told my friends, welcome to Bush with a tan!
Equality exists in Federal Government in that No One in Washington, standing in front of a mirror, casts a reflection. Souls are left at the front door, when they enter. Same is true for most State Capitols.
Hey Dan I bought last year, but I waited for a deal that fit the SO and my lifestyle on on salary. It was on par with rent, and we did not look at it as an investment. Also knew we were going to be here long term.
dan (47)-
But you can take advantage of price wars to pick up a sweet flat screen on the cheap!
pain (49)-
“we did not look at it as an investment”
The new mantra of residential RE.
Emergency Unlimited FDIC Coverage Extended to Clearing Accounts Until 2013
“Someone brought this to my attention, as I had not heard of it. It is not so much what they are doing, but why now?
With recovery supposedly at hand, and the financial crisis over thanks to Ben and Timmy, I wonder why they would enact unlimited FDIC coverage for what sounds like checking accounts and commercial clearing accounts….”
http://jessescrossroadscafe.blogspot.com/2011/03/emergency-unlimited-coverage-extended.html
Bergen County Seller asking $399K w/$11K in prop taxes, they bought in ’97 @ $160K ($220K in today’s dollars), house has been on market 177 days. I am thinking of offering $329K and assume all buyer closing cost – and hoping they take their profit and do the deal. Whaddaya think?
With my starter home example I think a 375k home falling to 275K home if you have a good rate, good house and is cheaper than rent is no big thing.
This new listing below is the type of nuttyness I saw at peak of market. Granted it is a real nice historical house. But someone bought it in 2005 for 1.5 million and just put it on the market for $1,095,00 and it is not a short sale. Someone is losing 500K (not the bank) on a house after 5 years of ownership. Can’t even imagine the maint on something that big and old plus the 20K in taxes. Most likely took from 1795 to 1985 for house to reach 500K, 200 years. But only took five years for house to fall 500K in value. The new math.
Mill River Rd
OYSTER BAY, NY 11771 Taxes: $17,604
Village Taxes: $2,714.42 List Price: $1,095,000
Antique/Hist, Detached, # Families: 1
10.0 rooms, 5 Bedrooms , 3 Full Baths , 1 Half Baths
School District: Oyster Bay-East Norwich
Year Built: 1795
Construction: Frame
Lot Size: 4.51 Acres
Appearance: Excellent
Gary [18];
“Let me be clear” is the left’s dog whistle.
Gary [11];
Comparisons to the Tobacco Settlement are striking.
Then: because “Big Tobbaco” lied to smokers about how dangerous and addictive their product is, addicted smokers get to pay more for their cigarettes to compensate the states in the large nine figure range.
Now: When millions of deadbeats stopped paying their mortgages, the banks filed “Lost Note” Affidavits en masse when they should have been filling “We Can’t be Bothered to Find the Note” Affidavits. To compensate them for the trauma of having suffered the contractual consequences of not paying, the deadbeats get a few grand knocked of their principal balance to make it easier on them when they default the next time. Oh, and the foreclosure process gets dragged out from three years to forever so the deadbeats have time to find alternate living arrangements.
If there is a writedown, the govt should identify the median amount and the median incomeassociated with it and then send thosr who pay their mortgage twicethat amount fot each factor if x their income is compared ti the mediam bailout. Say theemedian bailee earns 50,000/yr and gets a gift of $10,000 loan forgiveness, the person current with their mortgage who earns $100,000 should get a $20,000 check. Those who paid of their mortgsge should get the samr or maybe 2.5x and tgose who paid off their mortgage at keast 5 yeats early or paid in cash should get 3x the bailout factor.
If we are rrwarding deadbeats, we should likewise reward responsibility.
Mrs Shore and I would be only too pleases to use our check to buy up some of the vacant properties that are dragging down the market.
Shore expecting responsibility to be rewarded? What kind of upside down world do you live in these days. Don’t you know the new normal is; ruin a 100year company’s balance sheets to the point of insolvency, bailout! Destroy shareholder values on fradulent mortgages, bailout and golden parachute! 200 years of contract law, meh let’s forget that, bailout! Normal market cycles, meh bailout.
Prudent, sucker! Saver sucker! middle class, bend over sucker forget the vaseline!
Sorry I sound like the progressive chick
America the prudent this is what happens when you go to a nanny state model. At least she is still working
http://finance.yahoo.com/retirement/article/112417/homeowner-no-savings-some-options
http://www.masslive.com/news/index.ssf/2011/03/low_levels_of_radioactive_i-131_found_in_massachusetts_rainwater.html
Its perfectly safe. However, I can’t wait until the governor drinking it himself and give it to kids.
43. Compared to NYC it is a bargain.
I bet the gubmint wil discover nutritional value in I-131 very soon.
#56 Moose – You go ahead and keep trying to compare this to the tobacco settlement. The analogy doesn’t work. Why you cannot see the massive differences and why these two situations are so different on almost every level is beyond me.
This is not to say that I feel wholesale write downs can be fair and equitable. Laws to deal with fraud by the banks and it’s impact on borrowers have been in place forever. Borrowers who can prove damages caused by banks in foreclosure cases should pursue their claims. The law works if we use it. How about a special prosecuter for the financial crisis with an emphasis on the mortgage industry?
Pain,
It’s the fluffy woobie thing.
(64)
I agree the law is supposed to work if you use it. But every branch at every level of govt. has some or is just total corruption (not to mention incompetence).
But the last thing we need is more govt involvement and a “special prosecutor.”
(61) make
If the sample showed in Boston, that means it landed in Quabbin, or the interim reservoirs west of Boston.
Most Boston area water comes from reservoirs.
Nom – #27
For those who can afford it move to the Brig is merely the first step in determining that what one really needs is a Nompound. Price is not an object en route to the discovery of self-preservation.
/sarcasm????
Nom – #27
For those who can afford it a move to the Brig is merely the first step in determining that what one really needs is a Nompound. Price is not an object en route to the discovery of self-preservation.
/sarcasm????
PaulKR [53],
Have you checked the size of the lien on the place? It’s possible they have already taken much more than their economic profit.
These TEPCO guys are making FEMA look good:
“TOKYO (AP) — Power company officials say plutonium has been detected in the soil outside of the stricken Japanese nuclear complex.
Tokyo Electric Power Co. says in a statement that the plutonium was discovered Monday in five locations around the plant, which has been leaking radiation for nearly two weeks.
TEPCO official Jun Tsuruoka says the amounts were very small and were not a risk to public health.
Experts had expected traces of plutonium to be detected once crews began searching for it this week, since it is present in the nuclear fuel in the troubled complex.”
zieba – Tepco should hire Bagdad Bob, currently the plutonium is killing itself on the walls of containment vessel praise be to allah!
30-yr [64];
The similarities I see are 50 state attorneys general ganging up on a disfavored industry; extracting payment that far exceeds the scope of the crimes they are accused of that supposedly demand the restitution (akin to jailing Capone for life for tax evasion); paying the proceeds of the extortion to someone who wasn’t seriously harmed by the acts, but who pretty much got what was coming to them.
In the tobacco settlement, the crime was lying to smokers; the states grabbed the dough; and the price was paid by the smokers who had been lied to in higher cigarette prices going forward.
Pass the Tepco, please. Every 8 oz glas of orange-flavored Tepco supplies a full-day’s suply of nutrients essential to yodays nuclear family including plutonium, strontium, and the dificult to obtain through notmal diets, I131.
Try Tepco. Availa?ble at food stores eberyehere. Your friends will notice your radiant glow.
It is about time that the tepco ceo suited up and ealke the grounds of the reactor site.
Did i ever menymtion how BAD Android kryboards are?
Also, cell provider pushef out an OS upgrade that nuked applications and passeords and al but killed e-mail functionality.
Sprint, my @ss; it is more like crawl.
Is everyone out picking up some Tepco orange product? “The stuff that fuels the space program. Well, deep-space probes, anyway.”
#39
“How about a special prosecuter for the financial crisis with an emphasis on the mortgage industry?”
Won’t happen in the US (UK came down more heavily on their financial institutions, but nothing drastic).
Which party in the US do you think will do it? The right-wing crazy arm of the corporate party (aka GOP) or the right-leaning, left-pretending arm of the corporate party (aka democrats that get accused by crazies as commies).
Note that no party took issue with the government’s gift of 3.2 billion to GE (on top of 0% corporate tax rate). And GE’s “extraordinary success is based on an aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore. GE’s giant tax department is often referred to as world’s best tax law firm.”
The main stream people are fed anti-union BS, and the union employees are fed anti-immigrant BS, and the rich (natives as well as immigrants) are given nice tax breaks to go with gaping tax loop holes.
It all becomes a lottery. We all have to bend over and pray that our’s is not assaulted badly by the powers that be. The winners are the ones that come out of the ordeal with the least damage.
Shore, waiting to see cans of tuna that are dolphin and strontium free.
What a strange culture and way of thinking. TEPCO executives would rather go down in a fiery blaze rather than lay the cards out on the table. At this point they have to have a reasonable expectation that they themselves and certain regulatory agencies will be gutted to no end when the dust settles. So what’s the point of continuing down a path of continued omissions and miscalculations? Seems like they’re borne more out of a cultural fear of shame and dishonor rather than ineptitude.
Your time here in the US is best spend devising an intelligent exit strategy to Central America. Forget the nompound, fighting the fed and real estate prices. The moral hazard employed by our corporate masters is simply staggering. It shouldn’t be long before the tea-partiers even wise up to the reality of the ass-raping they are receiving from both parties.
The mortgage crisis was mainy caused by Mortgage Brokers and thinly regulated places like Wamu and Countrywide. Lots of toxic sludge that ended up on Commerical banks balance sheets were not originated by them. They bought them based on phony paperwork. The American Home Mortgages, Rescaps and Ditechs of the world are all dead. Chase for instance never cut its lending standards. All there junk is from Wamu, most of BACs junk is from Countrywide and most of Wells junk is from Wachovia. Funny part is Citi was not allowed to buy a failing mortgage bank in 2008-2010 and now they are the healthy. Easier to fix your bag of crap then to fix someone elses bag of crap.
JJ,
What is your opinion on the suspension of mark to market? How did this help anyone but the top of the food chain?
Look at Maiden Lane current value. The October 2008 to March 2009 price was fantasy.
Libtard says:
March 28, 2011 at 12:29 pm
JJ,
What is your opinion on the suspension of mark to market? How did this help anyone but the top of the food chain?
Stu, #83…
The unfortunate thing about the whole mess is that one can’t really time a reasonable window to exit, even when one is very confident that the long term trend is down. Add to it things like accumulation of fixed assets over time.
Most people will probably end up staying much too longer than ideal, hoping against hope. The early jumpers will feel really silly if things go back to normal or stay above the threshold for pain.
jj (84)-
If you call a giant, zombie GSE that just pulled a reverse split “healthy”, please never show me any banks that are in trouble. I don’t think I could handle it.
“Funny part is Citi was not allowed to buy a failing mortgage bank in 2008-2010 and now they are the healthy.”
Guess these fools didn’t get the memo that millions of Amerikans have learned how to braise IPads and now enjoy them at almost every meal.
“The Dallas Fed diffusion index is out, coming at a disappointing 11.5 on expectations of 18.4, with the market completely ignoring it. After all good diffusion index data is to be bought even if it confirms surging inflation, and bad diffusion index data is to be avoided. And while the component data is pretty bad (projected wages and benefits 6 months ahead plunge by 12 points as do Capital Expenditures, as firms refuse to spend any more organic cash on growth, offset by expectations of lower input costs, which remains TBD), the true nuts and bolts of the index can be gleaned from the respondent surve, presented below, although the most relevant one is here: “Prices are high, which makes for lower volume. The supply of cattle is limited. The cost of grain for livestock is unusually high because of high corn prices, partly attributable to ethanol subsidies. All of our raw material costs are at record highs. The cost of diesel also hurts us. A weak dollar is not good for us.” No surprise there.”
http://www.zerohedge.com/article/dallas-fed-big-miss-prints-115-expectations-184-survey-respondent-all-our-raw-material-costs
At least with Citi, we get the pleasure of seeing that dupe Alwaleed playing bagholder.
“This is the objective of the coalition now, it is not to protect civilians because now they are directly fighting against the armed forces,” Khaled Kaim, the deputy foreign minister, said in the capital, Tripoli. “They are trying to push the country to the brink of a civil war.”
His position found some support in Russia, where Foreign Minister Sergey Lavrov said strikes on Gadhafi’s forces would amount to interference in what he called Libya’s civil war, and thus would breach the U.N. Security Council resolution that envisaged a no-fly zone only to protect civilians. The council mandate, however, goes beyond a no-fly zone to allow “all necessary measures” to protect civilians.
Interesting that the Russians are more truthfull then “O”?
[83] libtard,
Frank Zappa said it best: “Movin’ to Montana soon. Gonna be a dental floss tycoon.”
On a conference call with my IRS advisory group. Also reviewed a letter from our national chair concerning a meeting from on high.
One of the issues that seems to be chafing IRS is that our committee is questioning their collection/enforcement efforts. IRS says that collection/enforcement is outside of our mandate. We respectfully disagree.
Seems that the Chosen One’s minions aren’t all that interested in transparency.
[87] sas3
It’s easy to predict the future. There are those here who tell me that no one is going to exit the U.S. In fact, the wealthy are clamoring to get in and be taxed here. All is well.
[69] sterling gray matter
I am not quite sure what you are saying. Too deep for me, I guess.
Amazing fact of the Day:
Concerning the makeup of the Final Four.
” out of the 5.9 million entries in the ESPN bracket contest, only two had this foursome making its way to Houston.”
Those two have some serious bragging rights.
“Those two have some serious bragging rights.”
It’s way more likely that those two were either mentally disabled or VCU/Butler alumni.
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Nothing in any of the stuff we’re debating that couldn’t be improved by a few high-velocity rounds to the skulls of some select miscreants.
Things will not get better until the crooks are identified and killed.
It’s taken TPTB decades to wrest complete control of the country away from individual citizens. They’re not giving it up without a fight to the death.
http://newsone.com/nation/newsonestaff2/nyc-subway-train-fight-spaghetti/
Fair use. A heads-up from ASCAP led me to this:
http://www.plagiarismtoday.com/2011/03/24/the-problem-with-the-fifth-fair-use-factor/
Citi completely screwed the pooch with common shareholders. But from a FDIC insurance safety and soundness of deposits point of view they are fine.
Also citi spent 2008-2011 unwinding and resolving troubled assets, they did not pick up more troubled assets. That is a good thing.
I am not saying to buy the stock. I am not saying it is a good company. I am saying they at the expense of shareholders fixed the bank. Plus taxpayers made a profit.
Debt Supernova says:
March 28, 2011 at 1:06 pm
jj (84)-
If you call a giant, zombie GSE that just pulled a reverse split “healthy”, please never show me any banks that are in trouble. I don’t think I could handle it.
“Funny part is Citi was not allowed to buy a failing mortgage bank in 2008-2010 and now they are the healthy.”
[97] libtard
More likely, they just threw darts. Or entered about 50 different brackets.
[97] libtard
Or, though they will never admit it, they could have made a mistake.
The wife really enjoys making and entering brackets for office pools. One year, the wife picked Weber State to beat UNC in the first round. I pointed this out to her and she said “oh no, that’s a mistake. I’m screwed.” But when Weber State beat UNC, she looked to all the world as the Prognosticator of Prognosticators.
I was sworn to secrecy until she left the company.
Life is good if you have a decent job here in the USA. NJ taxes aren’t much worse than paying “maintenance” on a mid-range NYC condo. I like living in single family homes. Keep on truckin
Mmmm… Plutonium
TOKYO, March 29, Kyodo
Plutonium has been detected in soil at five locations at the crippled Fukushima Daiichi nuclear power plant, Tokyo Electric Power Co. said Monday.
The operator of the nuclear complex said that the plutonium is believed to have been discharged from nuclear fuel at the plant, which was damaged by the devastating March 11 earthquake and tsunami.
http://english.kyodonews.jp/news/2011/03/81603.html
I’ve got cash, and I’m in on buying up more rentals. Problem is, the market is fixed. There are two foreclosures in my vicinity, but the banks will not put them on the market. One has a lock box and PSE&G red tagged the meters, but the previous owner broke in and is living in the illegal basement apartment. He somehow spliced into the grid, lights are on. City won’t do anything about it, he’s the “owner” according to their records. The house is nearly three years delinquent and the banks have it still in a “preforclosure” so the ownership has not changed hands to the bank so squaters can squat, city can’t do a thing. Its the wild west in America and I’m still paying my bills, doing my taxes. I feel foolish.
Babs (108)-
Default, and join the list of the successful.
The whole planet is headed toward it. Why not beat the rest of the world there?
Were the housing market not completely rigged, we’d be in the midst of multiple bank runs and complete societal breakdown.
RE # 31 DS Your comment about ” sand states” suggests to me you see prices
perhaps stabilizing there first…… did’nt states like FLA, CA and NJ see some of the
most ridiculous price run ups? If one was to swing a broad sword I would expect
the blood to flow to be worse in those areas. Did I misunderstand?
“WTF it is the end times anyway lets get the mark of the beast going.”
Pain. Mark of beast is 17% unemployment mixed with inflation in consumer staples, deflation in leveraged assets (to quote Debt), stagnation in real incomes, a disapearing middle class and a case shiller index that doesn’t know how to move downward.
“Collapse takes time…”
Expedite the bubble, delay the crash. Wash, rinse and repeat.
“a 3/2.5 split level POS at a value of 275K with a 11K property tax bill is the sign of the devil.”
Anything under a 3 handle is one of the four horsemen.
The year was 1999…. People over 40 had wrinkled brows. Cars were bought new every 7 years or so. Wimmens did their own manis and pedis and a lady’s purse cost under 100k. Kids birthday parties involved a Carvell Cookie Puss (upside down Fudgy the Whale), a backyard and some beer for the adults and people could buy 4 bedroom, 2 bath houses for under 400k in good towns. Property taxes over 10k represented ACREAGE. 12 years ago, folks. 12 years…
“I’m still paying my bills, doing my taxes. I feel foolish.”
Trust me. You’re not going to default your way to prosperity. It takes a special kind of circumstance to break back into your home and splice the wires to turn electricity back on.
116. I don’t think its that special. Working the system takes many forms. This one may not fit my lifestyle. There’s a reason that despite this economy, every restaurant in my area has a 1-2 hour wait to be seated through 10:30 pm on a Fri and Sat night.
You really think people living in foreclosed homes are doing it as part of a long term strategy to accumulate wealth? How about this instead. They’re hanging onto their foreclosures as last resort to avoid turning tricks or slitting wrist. Its a sad situation folks, not something to aspire to.
Neanderthal,
this guy is a section 8 slumlord. He picked up multiple properties, made illegal basement and attic apartments. He HELOCed the shiz out of them at the peak. I really don’t care about his current hard luck. Why even assume its hard luck? The guy is living for free in a decent apartment. He seems to be working by the looks of his garage and trucks. That’s a lot of freed up cash. Coming from a third world country, I’m sure the funky wiring isn’t as offensive as it may be to the rest of us. He had tenents too, just couldn’t clear those taxes and mortgage on that HELOC. Boo freakin hoo.
BTW I hardy think this is a unique case. As a landlord I’ve seen it over and over in a few markets.
Principal forgiveness may not be the silver bullet for housing SP…. The attorneys general settlement proposal to major servicers includes a push for more principal forgiveness on delinquent mortgages. Many servicers originators may attempt to pass an increase in costs to borrowers through higher mortgage rates..Analysts said principal forgiveness could reduce those losses for investors if the borrower remains current afterward.