Sunday, March 30, 2008
Tuesday, March 25, 2008
Anniversary Time
From the Brandenton Herald: Feb. home sales off in price, volume.
Pending sales may have soared in February but the number of existing-home sales in the Bradenton-Sarasota market was down 10 percent from just one year ago, according to numbers released Monday by the Florida Association of Realtors.
Nationally, sales were down 23.8 percent from February 2007, and statewide, sales were down 25 percent.
Owens' TeamWork team has 54 listings and 40 percent of those are short sales.
"I've had grown men coming into our office crying," Owens said.
Of course, today is the third anniversary of the publication of this sparkling gem from the New York Times.
In Miami, Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors, predicted that a limited supply of land coupled with demand from baby boomers and foreigners would prolong the boom indefinitely.
"South Florida," he said, "is working off of a totally new economic model than any of us have ever experienced in the past."
You sure got that right, sweetpea!
Pending sales may have soared in February but the number of existing-home sales in the Bradenton-Sarasota market was down 10 percent from just one year ago, according to numbers released Monday by the Florida Association of Realtors.
Nationally, sales were down 23.8 percent from February 2007, and statewide, sales were down 25 percent.
Owens' TeamWork team has 54 listings and 40 percent of those are short sales.
"I've had grown men coming into our office crying," Owens said.
Of course, today is the third anniversary of the publication of this sparkling gem from the New York Times.
In Miami, Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors, predicted that a limited supply of land coupled with demand from baby boomers and foreigners would prolong the boom indefinitely.
"South Florida," he said, "is working off of a totally new economic model than any of us have ever experienced in the past."
You sure got that right, sweetpea!
Monday, March 24, 2008
Glittering Green
From Reuters: New York City risks losing 20,000 finance jobs.
New York City risks losing more than 20,000 jobs in the high-paying financial sector over the next two years as the effect of the crisis in mortgage markets drives down Wall Street's profits, according to a report issued on Monday.
The city's Independent Budget Office, in its report, estimated that Wall Street's profits for 2007 will sink by more than 80 percent to the lowest level since 1994.
Profits for 2007 are expected to total just $3.2 billion, down from $20.9 billion in 2006, the report said.
Banks and brokerages account for almost 35 percent of all salaries and wages in New York City. Fallout from investments in the risky subprime mortgage market has forced Wall Street banks to write-down more than $150 billion -- and more red ink is expected.
Well, that should have NO effect on the Emerald City because the Europeans and the Chinese will buy all the condos!
New York City risks losing more than 20,000 jobs in the high-paying financial sector over the next two years as the effect of the crisis in mortgage markets drives down Wall Street's profits, according to a report issued on Monday.
The city's Independent Budget Office, in its report, estimated that Wall Street's profits for 2007 will sink by more than 80 percent to the lowest level since 1994.
Profits for 2007 are expected to total just $3.2 billion, down from $20.9 billion in 2006, the report said.
Banks and brokerages account for almost 35 percent of all salaries and wages in New York City. Fallout from investments in the risky subprime mortgage market has forced Wall Street banks to write-down more than $150 billion -- and more red ink is expected.
Well, that should have NO effect on the Emerald City because the Europeans and the Chinese will buy all the condos!
Friday, March 21, 2008
Where the EE walks people through obvious arguments...
In the upcoming recession, people will buy:
(a) more stuff, or
(b) less stuff.
Hence, margins must:
(a) rise, or
(b) drop.
Hence, to maintain profitability, business will try and:
(a) increase wages, or
(b) decrease wages.
And correspondingly, we can safely say that:
(a) less jobs will be outsourced to Chindia, or
(b) more jobs will be outsourced to Chindia.
And hence:
(a) more people will be able to pay their mortgage, or
(b) less people will be able to pay their mortgage.
And hence:
(a) foreclosures will fall, or
(b) foreclosures will rise.
And hence ...
(a) more stuff, or
(b) less stuff.
Hence, margins must:
(a) rise, or
(b) drop.
Hence, to maintain profitability, business will try and:
(a) increase wages, or
(b) decrease wages.
And correspondingly, we can safely say that:
(a) less jobs will be outsourced to Chindia, or
(b) more jobs will be outsourced to Chindia.
And hence:
(a) more people will be able to pay their mortgage, or
(b) less people will be able to pay their mortgage.
And hence:
(a) foreclosures will fall, or
(b) foreclosures will rise.
And hence ...
Wednesday, March 19, 2008
Self-Congratulatory Shee-yat
Here's a "blast from the past": A Tiny Preview from the Future from July 2007.
Interested in knowing what stories will hit the press in a years' time?
Abandoned Pets.
The "New Simplicity" (living within your means; watch for a "Time" article!)
People re-embracing religion
And here we go from Time Magazine: The New Austerity.
Amid all this hand-wringing, Americans have kept piling on more and more debt. The last significant episode of belt-tightening came during the recession of the early 1980s. But that turned out to be just the prelude to a quarter-century of growing profligacy, capped by a final half-decade of mostly mortgage-related fun that will go down as one of the most reckless borrowing-and-lending binges ever.
Now that particular binge has come to a crashing end, and the credit worriers believe their moment may have finally arrived. "I'm not saying we're going back to our parents' level of frugality," says David Rosenberg, North American economist at Merrill Lynch. "But what we have witnessed in the past 20 to 30 years — and especially the parabolic credit growth of the last five years — is going to be bursting in the next decade."
Americans simply don't have enough money to pay back the mortgage and credit-card debt they've run up.
This will, if it doesn't get out of hand (as in Great Depression out of hand), be a healthy development.
Please note that the Eccentric Economist nailed the specific time-frame, the form of the argument, and the magazine that it would be published in cold.
Oh and, ironically, that dude is right. We will not be headed back to our parents' level of frugality; we are going to be going right back to our grandparents' level.
Chuffa, puffa, chuffa, puffa.
The Bullshit Train™ always arrives on time!
Interested in knowing what stories will hit the press in a years' time?
And here we go from Time Magazine: The New Austerity.
Amid all this hand-wringing, Americans have kept piling on more and more debt. The last significant episode of belt-tightening came during the recession of the early 1980s. But that turned out to be just the prelude to a quarter-century of growing profligacy, capped by a final half-decade of mostly mortgage-related fun that will go down as one of the most reckless borrowing-and-lending binges ever.
Now that particular binge has come to a crashing end, and the credit worriers believe their moment may have finally arrived. "I'm not saying we're going back to our parents' level of frugality," says David Rosenberg, North American economist at Merrill Lynch. "But what we have witnessed in the past 20 to 30 years — and especially the parabolic credit growth of the last five years — is going to be bursting in the next decade."
Americans simply don't have enough money to pay back the mortgage and credit-card debt they've run up.
This will, if it doesn't get out of hand (as in Great Depression out of hand), be a healthy development.
Please note that the Eccentric Economist nailed the specific time-frame, the form of the argument, and the magazine that it would be published in cold.
Oh and, ironically, that dude is right. We will not be headed back to our parents' level of frugality; we are going to be going right back to our grandparents' level.
Chuffa, puffa, chuffa, puffa.
The Bullshit Train™ always arrives on time!
Monday, March 17, 2008
Sunday, March 16, 2008
Falling Knives
From Arizona: Only some get soaked as home values dive.
The hardest hit are sellers like Paul Joray and his wife, Jacqueline Caul, who listed their house in Maricopa for sale in December for less than they paid for it in 2006.
The couple, retired university administrators, bought a $719,000 house in Chandler's Ocotillo Lakes in January.
"I'm an economist so we understood that it's a great market to buy a house but not a great market to sell a house," Joray said.
Suppose you were a Grade-A moron. And suppose you were an Economist. But I repeat myself.
They listed their Maricopa house for $359,000, despite spending about $20,000 in landscaping.
Santa Maria, Madre de Dios!
You are losing money on $359K so you doubled down?
Joshua Tree Enema™ Time, and it ain't gonna be pretty!
The hardest hit are sellers like Paul Joray and his wife, Jacqueline Caul, who listed their house in Maricopa for sale in December for less than they paid for it in 2006.
The couple, retired university administrators, bought a $719,000 house in Chandler's Ocotillo Lakes in January.
"I'm an economist so we understood that it's a great market to buy a house but not a great market to sell a house," Joray said.
Suppose you were a Grade-A moron. And suppose you were an Economist. But I repeat myself.
They listed their Maricopa house for $359,000, despite spending about $20,000 in landscaping.
Santa Maria, Madre de Dios!
You are losing money on $359K so you doubled down?
Joshua Tree Enema™ Time, and it ain't gonna be pretty!
Wednesday, March 12, 2008
Candle in the Wind
From Redding, CA: Weak economy rams stores.
Rachel Carrino knows that when times are tough, specialty retailers are the first to feel the budget crunch.
"We are a want' store, not a need' store, so we are kind of the last place on everyone's list," said Carrino, whose Candle Connection in the Mt. Shasta Mall has seen declining sales since the fall.
Carrino isn't going out of business, but this year, holiday sales at Candle Connection were down about 35 percent from 2006.
Candle decline? California is obviously in recession!
Rachel Carrino knows that when times are tough, specialty retailers are the first to feel the budget crunch.
"We are a want' store, not a need' store, so we are kind of the last place on everyone's list," said Carrino, whose Candle Connection in the Mt. Shasta Mall has seen declining sales since the fall.
Carrino isn't going out of business, but this year, holiday sales at Candle Connection were down about 35 percent from 2006.
Candle decline? California is obviously in recession!
Pearl of Wisdom
From the Orlando Sentinel: Existing-home sales in Orlando area may have bottomed out.
Steven Moriera, president of the Orlando Realtors group, said he thinks the year-over-year declines are beginning to moderate -- the 40.2 percent drop in February was the smallest in six months -- though he wouldn't speculate on when a recovery might begin.
"We believe that there is light at the end of the tunnel, but we don't know how long the tunnel might be."
Steven Moriera, president of the Orlando Realtors group, said he thinks the year-over-year declines are beginning to moderate -- the 40.2 percent drop in February was the smallest in six months -- though he wouldn't speculate on when a recovery might begin.
"We believe that there is light at the end of the tunnel, but we don't know how long the tunnel might be."
Monday, March 10, 2008
Upside Down
From the Pensacola Journal: It's upside down time in housing.
A single mom with a 2-month-old infant called the other day with a question.
She was confused and looking for some advice.
Seems the young woman, a Warrington resident, wanted a home equity loan to add on a bedroom, consolidate credit card debt and buy new furniture.
"Someone told me I couldn't get a home improvement loan because I was upside down," she said over the phone. "What does that mean?"
I tried to explain that her house is now worth less than what is currently owed on the mortgage.
"But I still don't understand," she said. "I put $20,000 down on my house when I bought it. I've been making my mortgage payments every month for the past three years. How could I have lost all that money?"
You mean to say that the worth of a house is based on what other people are willing to pay, and a function of the credit markets not what you were duped into paying?
SHOCKER!
A single mom with a 2-month-old infant called the other day with a question.
She was confused and looking for some advice.
Seems the young woman, a Warrington resident, wanted a home equity loan to add on a bedroom, consolidate credit card debt and buy new furniture.
"Someone told me I couldn't get a home improvement loan because I was upside down," she said over the phone. "What does that mean?"
I tried to explain that her house is now worth less than what is currently owed on the mortgage.
"But I still don't understand," she said. "I put $20,000 down on my house when I bought it. I've been making my mortgage payments every month for the past three years. How could I have lost all that money?"
You mean to say that the worth of a house is based on what other people are willing to pay, and a function of the credit markets not what you were duped into paying?
SHOCKER!
Saturday, March 08, 2008
Big Pimpin' at PIMP-CO
From CNBC: Pimco's Gross: Fed Should Buy Mortgages.
The Federal Reserve needs to take a more active role in stemming the housing crisis, possibly by exchanging Treasury notes for mortgage notes, Pimco Bonds Chief Information Officer Bill Gross said on CNBC.
Fed buys MBS's. Dollar has a cow. Derivatives markets implode. Canned peas and AK-47 time.
Anybody who talks about "bailouts" hasn't done the math. All you need is one small index card, a pencil, and lots and lots of zeroes. Scientific notation might ease the pain, and prevent RSI.
I would also note all the failed "rescue" plans, and cite that ol' military adage that a failed rescue is no rescue at all.
Boring. Next.
The Federal Reserve needs to take a more active role in stemming the housing crisis, possibly by exchanging Treasury notes for mortgage notes, Pimco Bonds Chief Information Officer Bill Gross said on CNBC.
Fed buys MBS's. Dollar has a cow. Derivatives markets implode. Canned peas and AK-47 time.
Anybody who talks about "bailouts" hasn't done the math. All you need is one small index card, a pencil, and lots and lots of zeroes. Scientific notation might ease the pain, and prevent RSI.
I would also note all the failed "rescue" plans, and cite that ol' military adage that a failed rescue is no rescue at all.
Boring. Next.
Monday, March 03, 2008
50 Ways to Leave Your Mortgage
The Spinning Jenny is back! Remarks by Secretary Henry M. Paulson, Jr.
I believe our efforts are best focused on helping homeowners who want to stay in their homes.
Homeowners who can afford their mortgage should honor their obligations --- and most do.
BWAH-HAHAHHA-HAAHAHAHAHAHHAHAHHHH!
Now that the debtors are sticking it to the banks, they talk about "honor"? This is sheer desperation.
You just slip out the back, Jack
Make a new plan, Stan
You don't need to be coy, Roy
Just listen to me
Hop on the bus, Gus
You don't need to discuss much
Just drop off the key, Lee
And get yourself free.
I believe our efforts are best focused on helping homeowners who want to stay in their homes.
Homeowners who can afford their mortgage should honor their obligations --- and most do.
BWAH-HAHAHHA-HAAHAHAHAHAHHAHAHHHH!
Now that the debtors are sticking it to the banks, they talk about "honor"? This is sheer desperation.
You just slip out the back, Jack
Make a new plan, Stan
You don't need to be coy, Roy
Just listen to me
Hop on the bus, Gus
You don't need to discuss much
Just drop off the key, Lee
And get yourself free.
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