here's another "wonderful chain of stupidity", Calpers gambling for resurrection on private equity. hope taxpayers are not on the hook and hte unions take the heat for such stupid "investment"
Calpers spokesman Clark McKinley noted that Calpers in June raised its target commitment to private equity to 14 percent of assets from 10 percent.
“That’s an affirmation of our confidence in the asset class,” he said.
Don't worry, nyt online real estate section is covering the recovery in housing Helsinski, Finland today. There's always green shoots somewhere in the world.
this is a serious question, why on earth is it taken for granted that taxpayers have to make up for unfunded pension liabilities (specially when they come from bad investments)... given that voters have less and less pension of their own, why would they be willing to do that?
dickeylee
thats the reason i said 40 or 50 to give or take i couldnt remeber how many had already failed.
besides homegnome want let me take 34 banks for bff. least i dont think he would.?
CR wrote: "Guaranty is one of thousands of banks that invested in such securities ..."
continuing: "...securities backed by adjustable-rate mortgages, with two-thirds of the loans in foreclosure-wracked California, Florida and Arizona..."
Ok,
we have the loan array signature now the job is put NAMES to those thousands of banks, no?
22 years ago I'd be able to tell you of the top 100 banks who fit that modus operandi but after that
if they didn't float corporate grade debt at best I'd yawn.
Keefe Bruyette would have that information but at a price. If you're so inclined do a look back at
the last 5 years of annuals and quarterlys and start backing out the numbers.
renterinNYC - "..why would they be willing to do that?". Bwahahahahaha.
No one's asking if you're willing.
C
==========
you think they will get away with doing that explicitly? or implicitly printing yet more confetti? those liabilities if paid explicitly will come from higher property taxes chances are... not that there's anything wrong with that... higher carrying costs defeats the purpose of inflating home prices. at least something good there.
Alabama's UE has gone from 3.9 to 10.1 since waaaaay back in 2008. Georgia is also 10.1, Florida 10.6, North Carolina 11.1, and South Carolina is at 12.1. With UE increasing 250% in 18 months, I'm guessing a few more bank failures in the Confederacy.
"but we couldnt have that why we might come to believe that stupid banks making stupid choices shouldnt get bailed out by stupid gov (okay taxpayers) "
that bail out is being done by printing money, ... my point is, if we have to bail out SS, Medicare, unfunded public pensions... we will be printing money too? to taht extent?
wtf! sorry about my confusion. it seems obvious now that the state of california will issue IOUs (or their version of the amero) before a bail out from teh feds happens
Okay, found something to buy in SD- well in LA, but hey close enough by Socal standards.
We will see whether they take my offer. Nice print of an artist I like- they want $400 for it, I shot 'em an offer for $150 cash.
I'm guessing a few more bank failures in the Confederacy.
Tennessee's UE dropped to 10.7%. They actually admitted, “The lower rate is mostly a result of discouraged workers dropping out of the workforce.” Gotta love gov't statistics...
Waffles about something called demand. Wasn't this all about credit and money supply? And that's why the priorities are on liquidity infusions, like, everywhere?
I'm guessing a few more bank failures in the Confederacy.
Tennessee's UE dropped to 10.7%. They actually admitted, “The lower rate is mostly a result of discouraged workers dropping out of the workforce.” Gotta love gov't statistics...
Funny - I was killing time in Arkansas waiting for a guy to come in on a flight [we were going to a factory where they are sampling some of our parts]... while waiting I met a woman from Tennessee and she said everything was fine there - its all 'over blown'.
She also said there was no significant problem with real estate - none of the people she knows at their 'second home' in Naples is having trouble - not one foreclosure in their gated community. I kid you not... actually had the conversation.
There are three steps. 1. Market value losses. 2. Recognized losses. Recognition is often quite delayed. 3. Realized losses. Actually getting the crappy cashflows, or selling at a loss.
"Stiglitz Says Crisis Shows Failure of American-Style Capitalism ....
The worldwide financial system only worked because of repeated government bailouts and markets have been saved from their failures to allocate risk, Stiglitz, a Columbia University economics professor, said at a conference in Bangkok today.
Stiglitz told the conference that more collective action was needed on a global level to address the crisis and that the Group of 20 has been slow to address fundamental problems such as weak aggregate demand."
To save our economy, the govt has to spend more (or take "collective action" to "increase demand" in Stiglitz's terms). And if you don't follow his prescription we're all unemployed and poor. Didn't I hear this kind of pitch/threat before somewhere? Oh, yeah, October 2008, Paulson and Bernanke.
Everyone with a political or other agenda has decided this recession is their best opportunity to advance that agenda. And the motivation for the rest of us to follow their advice is what? "if you don't do what we say, your personal lifestyle and our entire economy is done for. For your own sake, for the sake of your family and neighbor, do whatever I say."
Forgive me for remaining skeptical and unconvinced, Joe.
Naples? Naples? No prob....Ah, you wish. I have family near there. They had a big house on Marco Island. Years ago, I told them sell sell sell...I mean, they were going to go upscale assisted living anyway. SO, why not? They were asking 3.5 mil. I told them, cut it to under 3, you'll move it. No friggin way, say they. What happened? Two years later, they got about 2.3 mil. I just shrugged. Its ony gone down from there....
Demand would be down if the supply of future money was cut off and that is what was fueling expansion. Peak debt (credit) will do that. Now, I'll go read the article to find out I took the entire thing out of context
GDD9000 - it was a pretty funny conversation. I have friends in Naples and concur. Don't know where she was coming from - realize she was very wealthy & 'sheltered'. She even admitted the latter. Her husband was a retired 'C' level exec at a large health care company... they were in town for some charity thing he volunteered for. My guess is she has no idea how bad it is in their 'compound'. Nice people don't talk about things like that.
oops, I forgot to mention any offerings said banks might propose in that time frame, that is inquiring minds!
c'mon, it's like chasing submarines, once you know the signature and can differentiate it from say a whale
thar' she blows! [note: bring a big enough boat]
"GDD9000 - it was a pretty funny conversation. I have friends in Naples and concur. Don't know where she was coming from - realize she was very wealthy & 'sheltered'. She even admitted the latter. Her husband was a retired 'C' level exec at a large health care company... they were in town for some charity thing he volunteered for. My guess is she has no idea how bad it is in their 'compound'. Nice people don't talk about things like that."
those types of housewives are really clueless, their only contact with reality sometimes is the maid, if so
That was EXACTLY what I thought... straight to their Naples second home.
She had another hum dinger... she said "As well off as a person might think they are... in Naples there are always a lot of people even better off. It is a bit humbling."
f*ck, sorry gaby, i meant $1 dollar, as in... what can you buy with $1 nowadays anyway?, well, between 2 and 5 of those single dollar bills. to my amusement she repeated it several times, as in a zombie state of mind... that's when i realized she had played the cassette before.
Is there a stratum that is truly not feeling the pinch? Might be.
Not that I would know that, of course.
renters with a low but stable salary with a good sense of mkt timing? (didn't lose $ during the crash)? those are doing ok and getting great deals on rentals.
As well off as a person might think they are... in Naples there are always a lot of people even better off.
where's her primary home,...lemme guess: Stepford?
are these the type of people we subsidize medicare to? men, make it universal!
"Ali Mohmed Al Megrahi, the only man convicted of the 1988 atrocity, flew home to a hero’s welcome in Tripoli..."
So, given the time served, it comes to 'bout two weeks sentence for each person murdered.....sad!
the guy has very little time to live, late state cancer. revenge is not the highest priority of the judiciary system in every single country. not in Scotland for sure.
Naples, eh?
I have this uncle who was born with a platinum spoon stuck in his nether regions. he has this sociopathic tendency to
buy properties complete with homes and then over time watch them crumble to the ground by refusing any maintenance
whatsoever. he bought this beachfront house in Naples in the '60s and sure enough by the mid 80's the main grand old house
roof collapsed and they moved to the guesthouse. about 10 years ago that became uninhabitable so he stop going to FLA,
he had other houses to destroy. 7 years ago somebody paid him 2.7 mil for the land alone...
Barley,
I see you miss the point made by the judge.
For all we know his 'hero's welcome' was quite propagandic.... probably not that hard to get a group of people from there to see something, whats Libyan unermployment rate?
two weeks sentence for each person murdered.....sad!
Let's pretend he served a year for each and lived to be four hundred,...would you really feel any better about it?
Is there a stratum that is truly not feeling the pinch? Might be.
Not that I would know that, of course.
Outsider - I have no idea. I would guess its possible - and even more likely that even if their estate is diminished they still have more money than God has little green apples [my mother's saying].
YLSP (profile) wrote on Thu, 8/20/2009 - 11:58 pm replyIgnore user$207B in treasury auctions next week?
From KD
*U.S. TREASURY TO AUCTION $27 BILLION IN 52-WEEK BILLS
*U.S. TREASURY TO AUCTION $42 BILLION IN TWO-YEAR NOTES
*U.S. TREASURY TO AUCTION $31 BILLION IN THREE-MONTH BILLS
*U.S. TREASURY TO AUCTION $28 BILLION IN SEVEN-YEAR NOTES
*U.S. TREASURY TO AUCTION $30 BILLION IN SIX-MONTH BILLS
*U.S. TREASURY TO AUCTION $39 BILLION IN FIVE-YEAR NOTES
Hey, one can say that judge misses the point of the "justice system". Certainly it exists to dole out punishment... how much is enough? Especially considering I'm sure it was more than a one-man operation... so yeah... it's pretty outrageous, just depends if you want justice and vengeance or something else.
renterinNYC - yup an older person who might be bitter...better bitter, of course, than someone who looks at you and says nope...your gone and I only get two weeks in jail
Hey, one can say that judge misses the point of the "justice system". Certainly it exists to dole out punishment... how much is enough? Especially considering I'm sure it was more than a one-man operation... so yeah... it's pretty outrageous, just depends if you want justice and vengeance or something else.
===============
and also shows that the response to an atrocity doens't need to be another atrocity (like invading a country that doesn't host those that attacked you... just you give you 1 example)
Hey, one can say that judge misses the point of the "justice system". Certainly it exists to dole out punishment... how much is enough? Especially considering I'm sure it was more than a one-man operation... so yeah... it's pretty outrageous, just depends if you want justice and vengeance or something else.
The justice system exists to punish people who don't have money or opportunity besides crime by taking away their money and any opportunity besides crime.
The justice system exists to punish people who don't have money or opportunity besides crime by taking away their money and any opportunity besides crime.
exactly, poverty is the crime. look at the unemployment in somalia, home of the pirates that used to be fisherman before those were decimated (not by themselves! but in part due to heavy vessel traffic).
renterinNYC (profile) wrote on Thu, 8/20/2009 - 11:14 pm
exactly, poverty is the crime. look at the unemployment in somalia, home of the pirates that used to be fisherman before those were decimated (not by themselves! but in part due to heavy vessel traffic).
Exactly. Very few folks commit crimes for the lolz, most out of either necessity, perceived necessity, or simple opportunity.
I did leave out the justice system's other key function, though: feeding a new supply of customers into the prison industry. Criminalization of poverty all but ensures continuous demand.
sdtfs (profile) wrote on Thu, 8/20/2009 - 11:20 pm
Preventing society from being one huge mass of perpetual vendettas?
I think it still is that. There are truly "criminal" people who must be dealt with but they are the exception, not the rule. And certainly they are NOT 40-60% of the population.
The likely thought they were smart selling off their garbage and investing in the "high quality" bear sterns stuff.
Some super duper senior AAA+ MBS with an AIG CDS backstop perhaps?
Oh my my.
yep the nasties, bearsteans lehman aig good salespeople sold to every man woman and child in the world. everyone is infected with them cds,cdos mbs blah blah blah . that is the problem. finished for a while. maybe
“what we could do going forward to make banking in Georgia better,” said Carolyn Brown, president and CEO of the Community Bankers Association of Georgia, who attended one of the sessions.
Brown said the short answer from those present at her meeting was, not much, if anything.
Yeah, it's a shame they're letting this convicted Libyan terrorist go back home to die.... a shame the Libyans are cheering him. We'd never do that, of course... 'American Exceptionalism' means we're ALWAYS right!
Oh, let's see who remembers why Libya decided to target an innocent airliner (I'm NOT excusing them, by the way)...
Lessee... who killed 290 civilians (including 66 civilians) by shooting down a slow, fat Civilian Aircraft which was taking off, flying commercial civilian flight plans, within its own country's airspace, transmitting the correct 'friendly' radio signals?
Oh yeah. The USS Vincennes ... nicknamed 'Robocruiser' ... whose captain later ADMITTED he aggressively moved his boat into Iranian territorial waters...
Did we put any of the men on the Vincennes in jail? Was Captain Rodgers of the Vincennes court martialed? Oh puhleeze... we can't even put our red handed bankers in jail!!
"The men of the Vincennes were all awarded Combat Action Ribbons for completion of their tours in a combat zone."
Read the Wiki ... a lot of folks OUTSIDE the US consider it a war crime. Hardly anyone in the US even remembers it.
yossarian (profile) wrote on Fri, 8/21/2009 - 12:51 am replyIgnore userYeah, it's a shame they're letting this convicted Libyan terrorist go back home to die.... a shame the Libyans are cheering him
Interesting that he got a heroes welcome. Obama said that he talked to the Lybian govt. to make sure no heroes welcome for the bomber. Obama said Lybia assured him there wouldn't be. Libya got all "we-wee'd" up
easy there Yossarian... the USS Vincennes?
that was the pride of the town I grew up in until that incident... still the pride of the town I grew up in!
...
justice, eh? yesterday I watched a man now living abroad who recounted in excruciating detail how his brother
was arrested by the Sanebal (KR secret police) and taken to S-21 where he signed a confession that he was a
CIA agent and then was brutally executed (method of execution usually was a bludgeoning with part of a truck axle).
I saw the actual confession. Interesting to note that according to his brother the note was written in a firm, steady hand
which brought into question Duch's (Kaing Kek Iew) assertion that everyone was tortured at S-21 with the exception of a few.
His brother and niece refused to grant the good Comrade mercy for his crimes.
....
The open letter to CFOs reminds them that Regulation S-K requires disclosure in management’s discussion and analysis of any known trends, demands, commitments, events or uncertainties that may be material to operations, liquidity or capital.
Yossarian wrote:
Oh yeah. The USS Vincennes ... nicknamed 'Robocruiser' ... whose captain later ADMITTED he aggressively moved his boat into Iranian territorial waters...
Did we put any of the men on the Vincennes in jail?
I agree with you on this, in my book it was a war crime!
And while we're at it can we also lock up at least half the town of Vincennes, IN?
not sure yet of their exact crimes but TRUST me they're there!
I'm wiped, but I ought to post like I promised. I think it is most likely that Bernanke is not reappointed.
I started thinking about it in terms of his campaigning and letters of support from economists and journalists. Sure Bernanke was blinded by his cheerleading pom-poms up until 2008, but once he started to act there was nothing he wouldn't do to preserve and sustain the financial system. Considering the institution, it took a lot of courage and leadership to accomplish the stability to date. I'm still curious whether his Maiden Lane x3 entities would be considered out of bounds if the politics allowed for the question to be considered. Last time I checked they hadn't updated any of the accounting marks.
Why is there a letter writing campaign? Do the authors know of a favored substitute for Bernanke, or a pet policy not possible with Bernanke there?
But none of that is really important.
The people who make the appointment are politicians. It's not clear to me why any lobby groups would intervene to favor Bernanke over any possible replacement. Bernanke is a Republican appointed by Bush, and now there is a new team in power. More than that, reappointing Bernanke is a political liability relative to any replacement who will do exactly what Bernanke would have done. It not only endorses the character of Bernanke and what he may do in the future, but what he has certainly done in the past. Now if you appoint someone new, it's win-win. Economy is great, new guy gets the credit and choice is justified. Economy is bad, Bernanke is blamed and choice is justified.
Don't underestimate the value of the chance to appoint a friend, or reward some loyalty. It not only is a boost the appointed one, it improves the morale of others working in and around the administration because the hope of advancement trickles down. You only keep the old guy if things are going really well and there are no conflicts.
Robert Reich gave a speech to the commonwealth club in California back in January. The one thing he spoke about which we have not yet seen is changing the treatment of primary residence mortgages to allow for the same cram downs possible on non-primary residences. I wouldn't be surprised if there are now plans for some kind of policy reform, and that the Fed in its omni-regulator status might be important.
These appointments take time to produce. First there are interviews, then there is the vetting, then there is the grooming, then support must be rallied, then the transition, and finally taking office. It's likely that word from the long lead time in the process has made it to some of the people who are campaigning for Bernanke.
Bernanke could easily be reappointed, but I don't think that fits into the plan here. After lobbying, politics is all about vengeance. I expect there is a lot of regret in supporting Greenspan who was appointed by Reagan, and under that comparison the last Democratic newly appointed Chairman was Paul Volcker who still carries a very positive reputation.
If I know the Obama administration, there are a lot of plans and many are shelved for a second term. It wouldn't fit to have such ambitions and then give up an appointment to take on the net political liability of reappointing Bernanke.
Key to that train of thought is there are only 5 of 7 spots on the Fed Board of Governors filled right now, with a vacancy coming up for one of them soon. Obama has the opportunity to leave the biggest imprint on the Fed in a long time.
I don't know about that. The 'Dollar Store' near me has some pretty good root beer and they're usually good for some cheap glass vases or "disposable" tape measures (I keep losing them). I mean, it's only a penny more than the 99 cent Only Store.
Just because I constantly see people talking about the large swaths of bank owned homes not yet on market I wanted to debunk that myth (at least for California).
There are a huge number of homes waiting to be foreclosed on.. but unless the banks ever foreclose on them they don't much matter to the market. The administration has so far derailed any attempts to bring on larger amounts of new supply despite the fact that many markets are running low on inventory and home sales are falling in those areas.
you wrote:
The people who make the appointment are politicians. It's not clear to me why any lobby groups would intervene to favor Bernanke over any possible replacement. Bernanke is a Republican appointed by Bush, and now there is a new team in power. `
Don't underestimate the value of the chance to appoint a friend, or reward some loyalty. It not only is a boost the appointed one, it improves the morale of others working in and around the administration because the hope of advancement trickles down. You only keep the old guy if things are going really well and there are no conflicts.""
.....
Following your logic that's why on May 2004 Greenspan was re-appointed by George W Bush. Please bear in mind that that same Fed chairman was blamed for his handling of monetary policy in the run-up to the 1991 recession which was criticized from the right as being excessively tight, and costing George H. W. Bush re-election.
Effective Demand,
If you ever see me talking about Shadow Inventory, I refer to homes that are likely to be sold soon enough, but not on the market yet. eg: vacant investment properties no longer rising in value, unemployed negative equity mortgage, paid off house which is hoping for a J shaped recovery in prices but will have to sell eventually to downsize to provide a boost to retirement funding, etc ..
`
If only 5mn houses can be foreclosed per year, it doesn't mean that there are not additional severely delinquent properties the bank has intentionally delayed taking possession of.
EHP
you also wrote - "politics is all about vengeance"
yep, that's why George rewarded Greenspan with a 4th re-up!
boy, when you wade into politics you're a babe in the woods, all due respect...
Duke of Con Dao,
Interesting room for argument, but Bernanke was appointed to the board in Fall 2002 and very likely explicitly groomed to be Greenspan's (then age 76) replacement. Bernanke got the nod privately and left Princeton after the 04-05 academic year. So he probably got word in 2004, about a year after the economic turn around. So under your counter logic, the vengeance axiom (if present in this case) would appear to hold
* this post has been edited
I think there is a tremendous amount of "latent" supply. But until it comes on market it doesn't much matter.
If the USG can keep housing in the doldrums for the next 15 years.. I think that would be just fine by them. We will have lower transactions and the issues will sit and fester but they are clearly going for stagnation.
p.s. 5 million foreclosures a year would be equal to the number of homes sold in a year. If we were at that level we'd be much closer to solving the problem.
If you ever see me talking about Shadow Inventory, I refer to:
empty buildings that don't have a sign out in front and no sign of what the heck is going on with them. I wonder if they're "private investor" owned property? An acquaintance oloaned on one that was supposed to be the site for a new house, but they (the dreamers) couldn't get it done, they took out the electric meter in the process and the city won't let him re-install it--a laundry list of code violations--so he's contemplating tearing the existing structure down and sitting on the lot for a long time.
I must visit the Dollar Store of value and stock up on lint rollers.
Yep, tons of awful cheap crap that's not worth having and a few (very few) things that ought to be a dollar, but are priced much higher at the local markets.
Whoever put this into the CR dictionary:
"Shadow Inventory: Foreclosed homes that lenders have not resold or listed for sale. By its very nature, the size of the shadow inventory is hard to estimate. Can also apply to homes kept off the market by owners who would like to sell but are waiting for prices to rise."
It actually isn't hard to estimate at all.. Foreclosures are a matter of public record. One can match up foreclosure data with MLS data to determine all the homes foreclosed on but not for sale.
It isn't nearly as large of number people want it to be.
Effective Demand,
I think the latent supply as you termed it, or shadow inventory as I call it, is extremely important. The reason why these homes are not on the market right now is because listings:sales is generally above 8 months nation wide. Years in the worst areas. If there is ever a real improvement, you will have a flood of properties try and take advantage. Which means prices cannot rise, because this shadow inventory keeps getting converted to real inventory.
The reason why banks are not rushing to foreclose is because there wouldn't be enough demand to sell them all if they tried selling all at once. The costs of a delinquent and foreclosed property are not equal. So the sales are being paced to an extent. Furthermore, it benefits them as mortgage servicers through higher fees. In the case of guaranteed mortgages, they can for example tack on all sorts of fees and interest which will be paid for by Freddie Mac (note: I may have been sloppy in my description of it, someone who'll read this should be able to clarify any mistake)
You have got to be kidding me if you think a house 18 months delinquent will stay off the market forever.
`
All that matters is the relative tightness of the local market. Below 4 is seller's market, 6 is neutral, 8 months and up is buyer's market or falling prices. Try a regression on your local market comparing monthly or quarterly listings to sales. Call it EHP's law. It is solid. The only difference between 8 and 10 months of inventory is how fast the price falls, but it will fall. As long as prices fall, the pain continues. As soon as listed inventory goes down, shadow inventory will step in to keep the price declines on cruise control. There is enough shadow inventory to make sure prices will stay down for years.
about the 5mn foreclosures,
I considered the impact of the moratoriums, and guesstimated what the annual throughput might be if banks push to clear their backlog. Even at 5mn annually, that could likely take several years to clear.
Re: "Policy makers in the U.S. and Europe have flooded the global economy with liquidity, which could lead to speculative bubbles due to limited opportunities for investment, he said. Stiglitz said he was not confident of the Fed’s claim that it would withdraw liquidity when needed."
Is Stiglitz talking about the first tsunami wave from the Bush Ownership Society (experiment) or the Obama Cash For Klunkers Wave w? TARP ll? I get them confused and never sure if one wave is overlapping another wave (insert tsunami icon here) ~~~~~~~~~~ I need a friggn tsunami wave for BFF, please!
They are forgetting Japan's 20 wave of ZIRP, quantitative easing, and fiscal stimulus which has never been reversed. If it were reversed now, Japan's economy would nose-dive again.
How come no one ever sends me the memo the day before Im supposed to get on the AIG FRE FNM bandwagon? And when I accidentally hitch a ride, how come they conveniently forget to tell me to get off at my stop?
Effective Demand,
I didn't write that CR dictionary entry, but your answer is in your post. Can also apply to homes kept off the market by owners who would like to sell but are waiting for prices to rise
Shadow Inventory is not equal to Foreclosures.
Sometimes it is Joe and Jill retiree just waiting for the "right time" to sell, and they do have a longer timeframe to sell but it is not infinite
`
I think you might be confused where your terminology conflicts with what appears to be a commonly accepted definition of shadow inventory. It might be stories about vulture investors tallying the # of bank owned properties in an area doing this. I can tell you those investors do not care if the bank has foreclosed or not, they care if the loan is delinquent and unlikely to self-cure. Vacant homes, yard/vehicle sales, and others are good indicators of a delinquent loan staying delinquent especially when it is negative equity
Maybe I'm not making myself clear but I think the USG is aiming for stagnation.
"All that matters is the relative tightness of the local market. Below 4 is seller's market, 6 is neutral, 8 months and up is buyer's market or falling prices. "
California's unsold inventory index stands at 4.1 months in June....
The reason that means it isnt a sellers market is because most sellers can't sell and buyers have no additional pricing power. The people who do have pricing power are the guys buying at trustee sales, they get the houses in the hottest segment... the low end (where in many places there is less than 2 months supply on market) and price above REO but below unrealistic seller retail and make bank.
"I think you might be confused where your terminology conflicts with what appears to be a commonly accepted definition of shadow inventory."
Funny, I run into the term shadow inventory all the time all over the web and the people are almost always talking about the belief that bank owned properties are being withheld from market.
My posts tonight was saying, If you believe that is true.. You are quite wrong.
So far the market in California is SUPPLY CONSTRAINED.. the issue isn't that there is too much inventory.. There is currently not enough!
The last time that 4 months inventory came up, I remember saying I don't care how it was achieved because it was impressive. Then someone informed me about some interference in the data, can't remember what it was. Might even have been the FTHB credit scheduled expiry + a hot FHA lending market + mostly low end.
`
I know you collect/sort some great data, I've been to your blog again and again just to look at the invisible FHA hand act on the charts. You also know California where this tight supply is registered. I'm just not clear how a policy of stagnation would be directed from the top, how it could resist natural pressures, and what the exit plan would be.
All of a sudden, people who never glanced at the Fed's H.3 statistical release are now experts on ``Aggregate Reserves of Depository Institutions and the Monetary Base.'' Their e-mails have the same sense of foreboding as the missives put out by the Black Helicopter/Tin-Foil Hat crowd.
What if the Fed's rate cuts aren't motivated by the desire to stave off recession, rather to prevent a major banking crisis?'' one e-mail read.The Fed's not telling anyone what it's up to because it doesn't want to cause panic, but the evidence is there in its own data.'' (Gosh, you'd think it would do a better job of hiding it. Maybe send H.3 to join M3!)
Effective Demand,
If it helps at all, I am sure I don't disagree with you in fact, and more than likely you are correctly chastising people who believe banks are withholding foreclosed properties from the market. There was a wave of stupidity across the internet recently complaining the FDIC was broke that drew a lot of attention, meanwhile how many hugely important issues have they ignored in the last year or two. It's a matter of not understanding ones' own limitations in discussion.
To reiterate: the negative non-borrowed reserves are not the real issue; the question is whether banks have become reliant on the TAF. In this bad credit market, when the Fed is on a program to ease aggressively, the Fed is not going to tinker with the TAF whether or not there is still a real need for it. Thus we mere mortals outside the regulatory regime will remain largely in the dark as to whether it is a prop or a mere expedient.
From Caroline Baum's article-- "This gentleman is overlooking the fact that the Fed is a monopoly provider of reserves,'' said Jim Glassman, senior U.S. economist at JPMorgan Chase & Co.This is a non-starter. There is no such thing as a banking system short of reserves. The Fed has absolute control over the supply.''"
For example, Cracking China's Banking System is well worth a read. You say "To an extent, it doesn't matter how much industry is given up to East Asia, as long as U.S. finance capital interests feel they will ultimately control the levers of that region." If true, this goes a long way towards explaining US policy toward China.
Funny, I run into the term shadow inventory all the time all over the web
Yeah, I'm guilty of using it to describe anything I don't understand about the "inventory" of housing,...so you can see it covers a lot of territory!
"Then someone informed me about some interference in the data, can't remember what it was."
I think thats the point, the whole market is highly engineered. Stopping banks from foreclosing, telling servicers to modify even if the investor of the loan doesn't want to and giving them legal protection to do so, FTHB tax credit, $1.25 trillion in printed money to buy MBS, $300 billion in printed money to buy Treasuries and $200 billion in printed money to buy agency debt.
All designed to prevent deflation.
How does it end? Thats the million dollar question I don't hope to know the answer to, but I can tell what is happening at this moment in time.. And that is stagnation.
I keep on thinking they can't keep this up and alternatively thinking there is no way they'll stop anytime soon.
Not sure if this will post, but this FRED indicates that banks are being pumped with liquidity and remain addicted to artificial life support, which includes accounting fraud, blessed by Uncle Sam. I posted a Yahoo screen earlier and the vast majority of corporations out there are void of earnings -- as they write off more and more impaired goodwill-kinda stuff. We essentially have a banking system that is crashed, and a capitalist system which has failed, yet to keep the game going, a trade-off exists that allows the dead beast to live as a zombie, and as such, the fantasy can continue, until ..... the burden becomes so great that the myth can no longer be justified.
Effective Demand,
I just don't see how a policy of stagnation can sustain itself long enough for it to be considered a policy. I would consider those actions and results to be a temporal feature of trying to substitute increased public debt for defaulting private debt, which itself has its own limitations. It hasn't stopped the price declines, even though it was combined with the seasonal bump which is naturally getting more significant. We've got another year of heavy inventory guaranteed. So time will march on, heeding no distractions
`
good night, too tired to make coherent word structures now
Effective Demand,
If there was a bank owned property not on the market, I would consider that to be a part of shadow inventory. That category is a very small part of shadow inventory. However I concede there are stupid people who are prone to beliefs in irrationally complex conspiracies and in doing so hijack an existing term, and you may sully their stupid names with my blessing
Ok, I did my part, I download the data and came up with an average EXCRESNS of 115.801 for the period between 2004-07-01 and 2009-07-01, and of course the latest period has an EXCRESNS value of 732.994, which seems a tad highrer than the average range, but maybe yah just need a puff on to understand whta's going on there..... I really can't say, because I'm just wearing and have about as much clothing on as a
I'm trying to find that story where Paulson and Bernanke were in a panic about TARP and the whole system was going to crash in like 24 hours... remember that moment?
Theoretically, the $732 could be loaned out. If you use a reserve ratio of 20%, it means the commercial banks could create roughly four times that amount in commercial bank cash, or 2.928 trillion. That, of course, would zoom M2.
But, the banks aren't lending it because they don't trust anyone and they can earn interest on that money risk free by depositing it at the Fed.
The trick is, Bernanke must figure out how to pull that money back as the banks begin to loan it out, and do it without stalling the economy.
When meant when I said unless they foreclose on those homes they don't much matter to the market..
Take me for example, I am a well qualified buyer looking to buy but finding nothing I'm willing to pay for. All those owners wanting to sell but unable to get the price they won't dont matter at all to me..
Only people listing at market prices matter. Someday, hopefully soon, that latent supply will hit the market. But right now the market is supply constrained (in CA) and buyers are unable to buy. If the fed can keep only REO / Short sale supply on the market and all the other sellers off the market that is a perfect market in which to liquidate that supply, the banks can meter it out without flooding the market.. they will control the supply and the demand very tightly.
If you wanted to buy in the next two years and the Fed holds off supply for the next 5 years.. all that latent supply doesn't help you one bit.
This is close enough: "On September 17 and 18, Paulson, along with Federal Reserve chairman Ben Bernanke, scared the bejesus out of Congress, when in private meetings they told legislative leaders that the world financial system was perhaps only hours away from full collapse without the sort of assistance that became the TARP. Therefore, it was most surprising that, following its final codification into law, Paulson displayed absolutely no haste in implementing it."
Ok, the deal here is, the system did crash and burn and the alternative is that you either save the banks and all the infrastructure and keep all the crooks in place to run the crooked system, or you let it crash and go into freefall -- they all decided that the devil we knew, was better than the devil that may come about, if chaos takes hold. We have thus ended up with a system that doesn't need earnings or accounting, auditing or honesty, but by God, we have a system!
so much for BO asking for Khadaffi's assurances not to hold a hero's welcome...
NY Times :
Ignoring American demands that Mr. Megrahi not be celebrated as a hero returning to his homeland, hundreds of young Libyans were bused to the military airport in Tripoli to welcome him home, cheering and waving Libyan and Scottish flags as he sped off in a convoy of white vehicles.
Before I take off my it does interest me that in this economic black hole that we are connected to, a place where future valuation has no meaning or less meaning than the disconnection to the past, so where are we? The illusions of and are both on a distant horizon at the end of a tunnel and from where we are now, the only way to keep going forward is to allow fraud to fuel the fires, so that at some point, the journey out of darkness takes us to a place of stability -- out of fear.
OT: "Marlow learns that he is to travel up the river to retrieve Kurtz (if he is alive), who was evidently left alone in unfamiliar territory. However, Marlow's steamer needs extensive repairs, and he cannot leave until he receives rivets, which take a suspiciously long time to arrive. Marlow suspects the manager of deliberately delaying his trip to prevent Kurtz from stealing the manager's job.
Marlow is finally able to leave on his journey with five other white men and a group of cannibals they have hired to run the steamer. He notes that the cannibals use a respectable amount of restraint in not eating the white men, as their only food source is a small amount of rotting hippo meat, and they far outnumber the white men, or "pilgrims" as Marlow refers to them."
He has to live in the midst of the incomprehensible, which is also detestable. And it has a fascination, too, that goes to work upon him. The fascination of the abomination--you know. Imagine the growing regrets, the longing to escape, the powerless disgust, the surrender, the hate."
...They were conquerors, and for that you want only brute force-- nothing to boast of, when you have it, since your strength is just an accident arising from the weakness of others. They grabbed what they could get for the sake of what was to be got. It was just robbery with violence, aggravated murder on a great scale, and men going at it blind--as is very proper for those who tackle a darkness. The conquest of the earth, which mostly means the taking it away from those who have a different complexion or slightly flatter noses than ourselves, is not a pretty thing when you look into it too much. What redeems it is the idea only. An idea at the back of it; not a sentimental pretense but an idea; and an unselfish belief in the idea--something you can set up, and bow down before, and offer a sacrifice to. . . ."
Is it possible for you to do a post a la Tanta regarding how and when servicer deal with the cash flow issues for mortgage delinquency? I remembered reading somewhere that servicers will advance the interests portion to the investors while charging and keeping the late fees. Also I think after 90 days the servicer stop doing this and start foreclosure proceedings. In the meantime, many of the delinquent debtors are not paying thus must present a big cash flow problem for servicer. It is just strange that we rarely hear any mentioned of this when MSM covered the foreclosures and NODs. Is it because no one really knows that answer?
what is it with these people- can't they recognize the simple truth "if you are spending more than you are earning and the bank won't lend you any more the solution is not to ask for a loan from Daddy"
The problem is not that aggregate demand is low now but rather that it was too high earlier. We should be working towards an economy that is able to sustain itself without requiring consumers to constantly go deeper into debt relative to income.
LOL.......They're all great, HomeG....even the new latest worthless horse, "Sparticus". He IS a keeper though. 1/2 quarterhorse, 1/2 fjord (a Norwegian draft horse) - pretty much bombproof. The girls sure don't know what to make of him though. We had ALL the livestock loose earlier when Belle & Sparticus stared snortin' and acting all rodeo.......and broke through the corral fencing. Rounding everyone up took hours. I keep saying I'm too old for this........
Hey, Mr and Mrs Geezer, I give you 50 cent on the dollar fo yo place and you gets to stay til you die. When you die, I be getting yo house and yo kids can kiss my ass, how bout dat?
it's a continues down fall of American banks and now the assets of the Guaranty Bank of taxas are sold out to Spanish bank . now this is the time to think carefully and take out our country form this misery!
-- Link deleted by kcoop --
Just how poor were all the folks on Wall Street., politicians who took bribes etc.
Poverty will always be with us- no matter how rich a society. Those on the bottom will always consider themselves or be considered poor. Virtually everybody who is considered poor in the United States would be considered well off in many parts of the world.
It is my understanding (source our police chief) that the research has shown that justice needs to be swift and sure not punitive to be effective. We have elected for punitive rather than swift and sure.
Consider enrolling in a course for ESL. You can look it up, just google English as Second Language. Meanwhile, you need to either get your more smarter than you relative to type for you or else go back to the Wok and Roll and turn out some more spring rolls.
what is your answer for Mr and Mrs Geezer. They have no cash but a lot of equity in their home. Do you want them to move, sell their house move into a tiny little place so that they can give children something?
BTW in the US the lender doesn't get the house. They get the proceeds sufficient to cover their interest and principal and the balance goes to the heirs.
Fannie requires that anybody who gets a reverse mortgage must get counseling first. Could we build additional safe guards, lower fees and move it into mainstream lending sure- but to blame the instrument or the concept outright makes no sense.
Hi dear Volcker!
Thanks for a kind advice my dear! i hope so you did the same thing thats why you are sharing your won opinion i am actually not very much satisfied with the current economical phase !it's not good my friend so we have to think and make some thing usefull for our country!
My dear Crazyv my answer will be for Mr and Mrs Geezer if they don't have cash then they should have to wait but dnt sale your home it's a precious thing that you have !
every problem gets finished when you be patiently so wait for a good time and try to bring that time earlier with your efforts !
What a crisis. My woes and wants:
Constant fear.
Pain.
Widespread medical malpractice allegations.
Guaranteed ligitation success?
Fraud.
Reverse mortgage is the answer?
Dear counter pointer !
relax i am here and i am a regular reader of this blog it's really a nice blog i want to buy a home but finding and searching some good ways that how to get home and then how it will be reliable for the future!can you help me on this matter?
I am not happy with the current situation as the us banks are not safe here? banks are continuously selling is there any one who can tell me that what's going on here?
-- Link deleted by kcoop --
homegnome
we really need to do something about the media. this will the second time in two weeks that they have "forced" a bf on us.
we are not supposed to have outside interference on this! this is our bff. small snide remark off
besides it messes up the count.
Does anyone ask or answer the question "who marketed these securities to banks"? That might seem irrelevant, but like we have all agreed, bank CFO's are not the sharpest cat's around, these were actively sold, not actively purchased.
....the sooner we weed out the derelict banks, the sooner we can get to the Main Event. Just another layer of skin peeled back to expose the REAL disease.
spider: Saw an interveiw with a little lady Mayor in Iceland, town lost every dime. She stated these securities were sold by Men in three piece suits who looked like Male Models who had been teaching Seccurities Investment to the US Treasury Officials. We all can be hazzzzzzzzzzd.
Futures look solid this morning. Hard to imagine anything other than a cataclysmic outside event pulling market down. There is no data which can not be dwarfed in the aggregate by spin and a barrage of positive headlines. Its unfortunate my gut does not allow me to participate.
Black Star Ranch (profile) wrote on Fri, 8/21/2009 - 8:38 am
....the sooner we weed out the derelict banks, the sooner we can get to the Main Event. Just another layer of skin peeled back to expose the REAL disease.
That kind of radical procedure might cause the patient to go into shock and die. I think the plan may be to try and wean it off the controlled (addictive) substance slowly. Of course, it's difficult to get off the juice when they actually keep pumping in more than ever. Damn, this analogy sucks
thats one down six more to go.
A wonderwall of idiocity.
Maybe "wonderful" in the sense that one wonders how they could have been so effing stupid...
Stupid? The smartest of the smart? Not our bankers, nooooooooo....
""Wonderful chain of stupidity.""
But, but he didn't say contained.
here's another "wonderful chain of stupidity", Calpers gambling for resurrection on private equity. hope taxpayers are not on the hook and hte unions take the heat for such stupid "investment"
Calpers spokesman Clark McKinley noted that Calpers in June raised its target commitment to private equity to 14 percent of assets from 10 percent.
“That’s an affirmation of our confidence in the asset class,” he said.
"wonderful chain of stupidity."
That pretty much describes this whole crisis. How much longer can the chain go on??
believed the" its almost to good to be true" hype about the nasties
Wow Clark, guess those x-ray glasses failed you there.
How much longer can the chain go on??
We are seeking the weakest link. Tirelessly.
One banking lawyer who asked not to be identified describes the result as a "wonderful chain of stupidity."
Ain't it a bitch when everyone ends up being a bagholder...uh...wait a minute
comrade d and a
let me put it this way georgia has 328 banks give or take 40 or 50. alabama has a few.i would say that it can go on for a while.
"remarkable", maybe?
One banking lawyer who asked not to be identified describes the result as a "wonderful chain of stupidity."
Aretha was onto these fools over 40 years ago
YouTube - Aretha Franklin - Chain Of Fools (Original footage!)
Don't worry, nyt online real estate section is covering the recovery in housing Helsinski, Finland today. There's always green shoots somewhere in the world.
OT: it's looks like japan found a wonderful wall of illiquidity to run into. down 1.3% for lunch.
I don't know about that Gaby, Georgia has had 22 bank failures so far, with another 34 banks on the watch list...
"OT: it's looks like japan found a wonderful wall of illiquidity to run into. down 1.3% for lunch."
these japanese need another lesson from ivy-league econ profs..., since early 1990s how many times did they tell them what to do!?
NSPCA - Not So Prompt Corrective Action
Depositors, rise up! You have nothing to lose but the wonderful chain of stupidity of your bankers!
Ok, some of you weren't that smart either.
C
as I understand it, the (bad) bank problems are 'contained'
Yeah, but Fleetwood Mac was much better at singing about chains:
YouTube -
we're all guaranty now?
this is a serious question, why on earth is it taken for granted that taxpayers have to make up for unfunded pension liabilities (specially when they come from bad investments)... given that voters have less and less pension of their own, why would they be willing to do that?
Another Wonderful Battle
dickeylee
thats the reason i said 40 or 50 to give or take i couldnt remeber how many had already failed.
besides homegnome want let me take 34 banks for bff. least i dont think he would.?
thus will the fecal matter be introduced to the ventilation system...
renterinNYC - "..why would they be willing to do that?". Bwahahahahaha.
No one's asking if you're willing.
C
CR wrote: "Guaranty is one of thousands of banks that invested in such securities ..."
continuing: "...securities backed by adjustable-rate mortgages, with two-thirds of the loans in foreclosure-wracked California, Florida and Arizona..."
Ok,
we have the loan array signature now the job is put NAMES to those thousands of banks, no?
22 years ago I'd be able to tell you of the top 100 banks who fit that modus operandi but after that
if they didn't float corporate grade debt at best I'd yawn.
Keefe Bruyette would have that information but at a price. If you're so inclined do a look back at
the last 5 years of annuals and quarterlys and start backing out the numbers.
I don't do polls, but there will be gnine bank failures come Friday eve. Gnine I say.
renterinNYC - "..why would they be willing to do that?". Bwahahahahaha.
No one's asking if you're willing.
C
==========
you think they will get away with doing that explicitly? or implicitly printing yet more confetti? those liabilities if paid explicitly will come from higher property taxes chances are... not that there's anything wrong with that... higher carrying costs defeats the purpose of inflating home prices. at least something good there.
renter
it seems to be just taken for granted that taxpayers are just chomping at the bit to make everything better.
what about the person(s) that believed the hype about the nasties how about they make it up.?
but we couldnt have that why we might come to believe that stupid banks making stupid choices shouldnt get bailed out by stupid gov (okay taxpayers)
Alabama's UE has gone from 3.9 to 10.1 since waaaaay back in 2008. Georgia is also 10.1, Florida 10.6, North Carolina 11.1, and South Carolina is at 12.1. With UE increasing 250% in 18 months, I'm guessing a few more bank failures in the Confederacy.
ga is 10.3 now
"but we couldnt have that why we might come to believe that stupid banks making stupid choices shouldnt get bailed out by stupid gov (okay taxpayers) "
that bail out is being done by printing money, ... my point is, if we have to bail out SS, Medicare, unfunded public pensions... we will be printing money too? to taht extent?
OTS didn't issue a PCA, they issued a CYA.
Sounds like the Confederacy is due a PCA letter too.
C
renterin nyc
if its printing money then we dont owe it.
I'm not sure it is so "wonderful" ...
It sure causes me to be full of wonder that such stupidity exists.
wtf! sorry about my confusion. it seems obvious now that the state of california will issue IOUs (or their version of the amero) before a bail out from teh feds happens
jp oh yeah it does it really exists
Okay, found something to buy in SD- well in LA, but hey close enough by Socal standards.
We will see whether they take my offer. Nice print of an artist I like- they want $400 for it, I shot 'em an offer for $150 cash.
Someday this war's gonna end...
renterin nyc
if its printing money then we dont owe it.
exactly, the saver in USD pays, so who cares?
citizen allen m
let us know how it goes
I'm guessing a few more bank failures in the Confederacy.
Tennessee's UE dropped to 10.7%. They actually admitted, “The lower rate is mostly a result of discouraged workers dropping out of the workforce.” Gotta love gov't statistics...
how are artists holding up?
I'm guessing a few more bank failures in the Confederacy.
back to cotton backed bonds?
O/T for a change, Stiglitz, not at Jackson Hole, says crisis shows failure of American-style capitalism:
Stiglitz Says Crisis Shows Failure of American-Style Capitalism - Bloomberg.com
Waffles about something called demand. Wasn't this all about credit and money supply? And that's why the priorities are on liquidity infusions, like, everywhere?
Wait a minute...
C
yagij what i am looking for is rolling bff each week at least two in each time zone.
tn is honest good for them.
But Mississippi's UE-3 is only, ONLY 9%. God that's just got to be embarrassing to Alabama!
Unfortunately, stupidity can't be chained up- some idiot always comes along and lets it go.
I'm guessing a few more bank failures in the Confederacy.
Tennessee's UE dropped to 10.7%. They actually admitted, “The lower rate is mostly a result of discouraged workers dropping out of the workforce.” Gotta love gov't statistics...
Funny - I was killing time in Arkansas waiting for a guy to come in on a flight [we were going to a factory where they are sampling some of our parts]... while waiting I met a woman from Tennessee and she said everything was fine there - its all 'over blown'.
She also said there was no significant problem with real estate - none of the people she knows at their 'second home' in Naples is having trouble - not one foreclosure in their gated community. I kid you not... actually had the conversation.
It must all be your doomer imagination.
Wasn't this all about credit and money supply?
.... and leverage, and systemic risk, and alphabetical structures
Writedowns don't consume capital. Reality consumes capital.
There are three steps. 1. Market value losses. 2. Recognized losses. Recognition is often quite delayed. 3. Realized losses. Actually getting the crappy cashflows, or selling at a loss.
"Stiglitz Says Crisis Shows Failure of American-Style Capitalism ....
The worldwide financial system only worked because of repeated government bailouts and markets have been saved from their failures to allocate risk, Stiglitz, a Columbia University economics professor, said at a conference in Bangkok today.
Stiglitz told the conference that more collective action was needed on a global level to address the crisis and that the Group of 20 has been slow to address fundamental problems such as weak aggregate demand."
To save our economy, the govt has to spend more (or take "collective action" to "increase demand" in Stiglitz's terms). And if you don't follow his prescription we're all unemployed and poor. Didn't I hear this kind of pitch/threat before somewhere? Oh, yeah, October 2008, Paulson and Bernanke.
Everyone with a political or other agenda has decided this recession is their best opportunity to advance that agenda. And the motivation for the rest of us to follow their advice is what? "if you don't do what we say, your personal lifestyle and our entire economy is done for. For your own sake, for the sake of your family and neighbor, do whatever I say."
Forgive me for remaining skeptical and unconvinced, Joe.
I met a woman from Tennessee and she said everything was fine there - its all 'over blown'.
Perhaps it was Phil Gramm in drag.
Naples? Naples? No prob....Ah, you wish. I have family near there. They had a big house on Marco Island. Years ago, I told them sell sell sell...I mean, they were going to go upscale assisted living anyway. SO, why not? They were asking 3.5 mil. I told them, cut it to under 3, you'll move it. No friggin way, say they. What happened? Two years later, they got about 2.3 mil. I just shrugged. Its ony gone down from there....
i think what she was doing was not airing her laundry in public.. or maybe she s telling her truth.
I'll comment, then read the article.
Demand would be down if the supply of future money was cut off and that is what was fueling expansion. Peak debt (credit) will do that. Now, I'll go read the article to find out I took the entire thing out of context
"i think what she was doing was not airing her laundry in public.. or maybe she s telling her truth."
she has a mental cassette that needs to be played over and over again in order for denial to win.
Ought'nt there be a helicopter icon. And a Buddha icon as well. Impermanence and all.
renterinnyc
that might work too sort of like the "recovery"
GDD9000 - it was a pretty funny conversation. I have friends in Naples and concur. Don't know where she was coming from - realize she was very wealthy & 'sheltered'. She even admitted the latter. Her husband was a retired 'C' level exec at a large health care company... they were in town for some charity thing he volunteered for. My guess is she has no idea how bad it is in their 'compound'. Nice people don't talk about things like that.
somebody also told me a week ago at a party, that if her house went down in value, it was only $2 to $5... ivy-league graduate, for real
oops, I forgot to mention any offerings said banks might propose in that time frame, that is inquiring minds!
c'mon, it's like chasing submarines, once you know the signature and can differentiate it from say a whale
thar' she blows! [note: bring a big enough boat]
"GDD9000 - it was a pretty funny conversation. I have friends in Naples and concur. Don't know where she was coming from - realize she was very wealthy & 'sheltered'. She even admitted the latter. Her husband was a retired 'C' level exec at a large health care company... they were in town for some charity thing he volunteered for. My guess is she has no idea how bad it is in their 'compound'. Nice people don't talk about things like that."
those types of housewives are really clueless, their only contact with reality sometimes is the maid, if so
By Bloomberg News
Aug. 21 (Bloomberg) -- China plans to tighten capital requirements for banks, threatening to curb the record lending that’s fueled a 60 percent rally in the nation’s stock market, three people familiar with the matter said.
China Said to Plan Rules Tightening Capital of Banks (Update1) - Bloomberg.com
"Her husband was a retired 'C' level exec at a large health care company... "
is there were my premiums go?
renterinNYC (profile) wrote on Thu, 8/20/2009 - 10:42 pm
she has a mental cassette that needs to be played over and over again in order for denial to win.
Propaganda is a beautiful thing, isn't it? The true genius of the system is how they figured out how to addict us to it!!
Here's my agenda for the recession: make money off of stupid people selling things for prices they shouldn't be selling them at.
My current annual return is about 65%. Assuming no new defaults, it should stay over 20% annual until 2015.
I used to hare stupid people. That was when I had no investment capital.
renterinNYC (profile) wrote on Thu, 8/20/2009 - 10:46 pm
"Her husband was a retired 'C' level exec at a large health care company... "
is there were my premiums go?
Don't think of it as salary... think of it as hush money! Keep your mouth shut about where the bodies are buried and we'll keep the money flowin'
Here's my agenda for the recession: make money off of stupid people selling things for prices they shouldn't be selling them at.
in teh stock mkt or in ebay? lol
I used to hare stupid people. That was when I had no investment capital.
hating the stupid is believing you have a credential on intelligence. not a good thing for an investor imho.
renterinnyc
no k,or m behind the 2 to 5$????
Here's my agenda for the recession: make money off of stupid people selling things for prices they shouldn't be selling them at.
And to think someone has their sights on you. Tadpole.
k,or m?
I think he's kind've just an oppurtunist.... not really an investor.
is there were my premiums go?
That was EXACTLY what I thought... straight to their Naples second home.
She had another hum dinger... she said "As well off as a person might think they are... in Naples there are always a lot of people even better off. It is a bit humbling."
1000 or 1,000,000 k or m
renterinnyc.
That's a big BFF, gabyjan. You sure?
C
f*ck, sorry gaby, i meant $1 dollar, as in... what can you buy with $1 nowadays anyway?, well, between 2 and 5 of those single dollar bills. to my amusement she repeated it several times, as in a zombie state of mind... that's when i realized she had played the cassette before.
c
no not now maybe when jax office is open. who knows
Maybe this was more of a docudrama, except that ol' Rowdy Roddy never made it...
.ever.
YouTube - They Live - The moment of revelation
Best.
$207B in treasury auctions next week?
Is there a stratum that is truly not feeling the pinch? Might be.
Not that I would know that, of course.
renterinnyc
i was just wondering because she might be a very sheltered wife. never know.
"i was just wondering because she might be a very sheltered wife. never know. "
the $2-$5 down from the peak girl is single in her late 30s
As well off as a person might think they are... in Naples there are always a lot of people even better off.
where's her primary home,...lemme guess: Stepford?
Is there a stratum that is truly not feeling the pinch? Might be.
Not that I would know that, of course.
renters with a low but stable salary with a good sense of mkt timing? (didn't lose $ during the crash)? those are doing ok and getting great deals on rentals.
Lockerbie bomber:
"Ali Mohmed Al Megrahi, the only man convicted of the 1988 atrocity, flew home to a hero’s welcome in Tripoli..."
So, given the time served, it comes to 'bout two weeks sentence for each person murdered.....sad!
As well off as a person might think they are... in Naples there are always a lot of people even better off.
where's her primary home,...lemme guess: Stepford?
are these the type of people we subsidize medicare to? men, make it universal!
"Ali Mohmed Al Megrahi, the only man convicted of the 1988 atrocity, flew home to a hero’s welcome in Tripoli..."
So, given the time served, it comes to 'bout two weeks sentence for each person murdered.....sad!
the guy has very little time to live, late state cancer. revenge is not the highest priority of the judiciary system in every single country. not in Scotland for sure.
renterinnyc
okay misunderstood
thanks for correction
renterinNYC - Call me a bitter older person but ...let him rot in the jail cell.
Naples, eh?
I have this uncle who was born with a platinum spoon stuck in his nether regions. he has this sociopathic tendency to
buy properties complete with homes and then over time watch them crumble to the ground by refusing any maintenance
whatsoever. he bought this beachfront house in Naples in the '60s and sure enough by the mid 80's the main grand old house
roof collapsed and they moved to the guesthouse. about 10 years ago that became uninhabitable so he stop going to FLA,
he had other houses to destroy. 7 years ago somebody paid him 2.7 mil for the land alone...
Barley,
I see you miss the point made by the judge.
For all we know his 'hero's welcome' was quite propagandic.... probably not that hard to get a group of people from there to see something, whats Libyan unermployment rate?
two weeks sentence for each person murdered.....sad!
Let's pretend he served a year for each and lived to be four hundred,...would you really feel any better about it?
Barley, only cause you asked for it, you are a bitter older person...
YLSP - no point missed....If I kill 200 people I get two weeks per person in jail...nothing more or less. Sad.
Is there a stratum that is truly not feeling the pinch? Might be.
Not that I would know that, of course.
Outsider - I have no idea. I would guess its possible - and even more likely that even if their estate is diminished they still have more money than God has little green apples [my mother's saying].
It was just quite an odd conversation.
YLSP (profile) wrote on Thu, 8/20/2009 - 11:58 pm replyIgnore user$207B in treasury auctions next week?
From KD
*U.S. TREASURY TO AUCTION $27 BILLION IN 52-WEEK BILLS
*U.S. TREASURY TO AUCTION $42 BILLION IN TWO-YEAR NOTES
*U.S. TREASURY TO AUCTION $31 BILLION IN THREE-MONTH BILLS
*U.S. TREASURY TO AUCTION $28 BILLION IN SEVEN-YEAR NOTES
*U.S. TREASURY TO AUCTION $30 BILLION IN SIX-MONTH BILLS
*U.S. TREASURY TO AUCTION $39 BILLION IN FIVE-YEAR NOTES
Hey, one can say that judge misses the point of the "justice system". Certainly it exists to dole out punishment... how much is enough? Especially considering I'm sure it was more than a one-man operation... so yeah... it's pretty outrageous, just depends if you want justice and vengeance or something else.
How do those auctions compare to the history?
Pretenders - Back on the chain gang
YouTube - Pretenders - Back on the chain gang (Dortmund 1984)
watch them crumble to the ground by refusing any maintenance
And to think I mow my yard once a week. A schlep I am.
renterinNYC - yup an older person who might be bitter...better bitter, of course, than someone who looks at you and says nope...your gone and I only get two weeks in jail
Hey, one can say that judge misses the point of the "justice system". Certainly it exists to dole out punishment... how much is enough? Especially considering I'm sure it was more than a one-man operation... so yeah... it's pretty outrageous, just depends if you want justice and vengeance or something else.
===============
and also shows that the response to an atrocity doens't need to be another atrocity (like invading a country that doesn't host those that attacked you... just you give you 1 example)
YLSP (profile) wrote on Thu, 8/20/2009 - 11:10 pm
Hey, one can say that judge misses the point of the "justice system". Certainly it exists to dole out punishment... how much is enough? Especially considering I'm sure it was more than a one-man operation... so yeah... it's pretty outrageous, just depends if you want justice and vengeance or something else.
The justice system exists to punish people who don't have money or opportunity besides crime by taking away their money and any opportunity besides crime.
"like invading a country that doesn't host those that attacked you"
noted and understood
The justice system exists to punish people who don't have money or opportunity besides crime by taking away their money and any opportunity besides crime.
exactly, poverty is the crime. look at the unemployment in somalia, home of the pirates that used to be fisherman before those were decimated (not by themselves! but in part due to heavy vessel traffic).
Well, this thread started out slow and it's not getting any faster.
Does "prompt" as in PCA mean when we get around to it?
renterinNYC (profile) wrote on Thu, 8/20/2009 - 11:14 pm
exactly, poverty is the crime. look at the unemployment in somalia, home of the pirates that used to be fisherman before those were decimated (not by themselves! but in part due to heavy vessel traffic).
Exactly. Very few folks commit crimes for the lolz, most out of either necessity, perceived necessity, or simple opportunity.
I did leave out the justice system's other key function, though: feeding a new supply of customers into the prison industry. Criminalization of poverty all but ensures continuous demand.
I did leave out the justice system's other key function,
Preventing society from being one huge mass of perpetual vendettas?
sdtfs (profile) wrote on Thu, 8/20/2009 - 11:20 pm
Preventing society from being one huge mass of perpetual vendettas?
I think it still is that. There are truly "criminal" people who must be dealt with but they are the exception, not the rule. And certainly they are NOT 40-60% of the population.
The likely thought they were smart selling off their garbage and investing in the "high quality" bear sterns stuff.
Some super duper senior AAA+ MBS with an AIG CDS backstop perhaps?
Oh my my.
yep the nasties, bearsteans lehman aig good salespeople sold to every man woman and child in the world. everyone is infected with them cds,cdos mbs blah blah blah . that is the problem.
finished for a while. maybe
oh here i was looking for something else and found this.
Perdue, CEOs meet on banking crisis | ajc.com
“what we could do going forward to make banking in Georgia better,” said Carolyn Brown, president and CEO of the Community Bankers Association of Georgia, who attended one of the sessions.
Brown said the short answer from those present at her meeting was, not much, if anything.
Re: "Wonderful chain of stupidity."
Letterman - Stupid Pet Tricks: Playing Dead
YouTube - Letterman - Stupid Pet Tricks: Playing Dead
Yeah, it's a shame they're letting this convicted Libyan terrorist go back home to die.... a shame the Libyans are cheering him. We'd never do that, of course... 'American Exceptionalism' means we're ALWAYS right!
Oh, let's see who remembers why Libya decided to target an innocent airliner (I'm NOT excusing them, by the way)...
Lessee... who killed 290 civilians (including 66 civilians) by shooting down a slow, fat Civilian Aircraft which was taking off, flying commercial civilian flight plans, within its own country's airspace, transmitting the correct 'friendly' radio signals?
Iran Air Flight 655 - Wikipedia, the free encyclopedia
Oh yeah. The USS Vincennes ... nicknamed 'Robocruiser' ... whose captain later ADMITTED he aggressively moved his boat into Iranian territorial waters...
Did we put any of the men on the Vincennes in jail? Was Captain Rodgers of the Vincennes court martialed? Oh puhleeze... we can't even put our red handed bankers in jail!!
"The men of the Vincennes were all awarded Combat Action Ribbons for completion of their tours in a combat zone."
Read the Wiki ... a lot of folks OUTSIDE the US consider it a war crime. Hardly anyone in the US even remembers it.
"Perhaps it was Phil Gramm in drag."
Conjure Bag would pay handsomely for fifteen minutes alone with Phil Gramm and immunity from prosecution.
Edit: He'd pay even more if Wendy could be there too.
yossarian (profile) wrote on Fri, 8/21/2009 - 12:51 am replyIgnore userYeah, it's a shame they're letting this convicted Libyan terrorist go back home to die.... a shame the Libyans are cheering him
Interesting that he got a heroes welcome. Obama said that he talked to the Lybian govt. to make sure no heroes welcome for the bomber. Obama said Lybia assured him there wouldn't be. Libya got all "we-wee'd" up
easy there Yossarian... the USS Vincennes?
that was the pride of the town I grew up in until that incident... still the pride of the town I grew up in!
...
justice, eh? yesterday I watched a man now living abroad who recounted in excruciating detail how his brother
was arrested by the Sanebal (KR secret police) and taken to S-21 where he signed a confession that he was a
CIA agent and then was brutally executed (method of execution usually was a bludgeoning with part of a truck axle).
I saw the actual confession. Interesting to note that according to his brother the note was written in a firm, steady hand
which brought into question Duch's (Kaing Kek Iew) assertion that everyone was tortured at S-21 with the exception of a few.
His brother and niece refused to grant the good Comrade mercy for his crimes.
....
SEC Staff Advises Careful MD&A Around Loan Losses
Compliance Week: Accounting & Auditing Update - » SEC Staff Advises Careful MD&A Around Loan Losses
The open letter to CFOs reminds them that Regulation S-K requires disclosure in management’s discussion and analysis of any known trends, demands, commitments, events or uncertainties that may be material to operations, liquidity or capital.
Yossarian wrote:
Oh yeah. The USS Vincennes ... nicknamed 'Robocruiser' ... whose captain later ADMITTED he aggressively moved his boat into Iranian territorial waters...
Did we put any of the men on the Vincennes in jail?
I agree with you on this, in my book it was a war crime!
And while we're at it can we also lock up at least half the town of Vincennes, IN?
not sure yet of their exact crimes but TRUST me they're there!
Stiglitz Says Dollar as Good Store of Value Is ‘Questionable’
Stiglitz Sees Risk to Dollar, Need for Reserve System (Update2) - Bloomberg.com
/snark on
Really!?
/snark off
I just had to do that.
I'm wiped, but I ought to post like I promised. I think it is most likely that Bernanke is not reappointed.
I started thinking about it in terms of his campaigning and letters of support from economists and journalists. Sure Bernanke was blinded by his cheerleading pom-poms up until 2008, but once he started to act there was nothing he wouldn't do to preserve and sustain the financial system. Considering the institution, it took a lot of courage and leadership to accomplish the stability to date. I'm still curious whether his Maiden Lane x3 entities would be considered out of bounds if the politics allowed for the question to be considered. Last time I checked they hadn't updated any of the accounting marks.
Why is there a letter writing campaign? Do the authors know of a favored substitute for Bernanke, or a pet policy not possible with Bernanke there?
But none of that is really important.
The people who make the appointment are politicians. It's not clear to me why any lobby groups would intervene to favor Bernanke over any possible replacement. Bernanke is a Republican appointed by Bush, and now there is a new team in power. More than that, reappointing Bernanke is a political liability relative to any replacement who will do exactly what Bernanke would have done. It not only endorses the character of Bernanke and what he may do in the future, but what he has certainly done in the past. Now if you appoint someone new, it's win-win. Economy is great, new guy gets the credit and choice is justified. Economy is bad, Bernanke is blamed and choice is justified.
Don't underestimate the value of the chance to appoint a friend, or reward some loyalty. It not only is a boost the appointed one, it improves the morale of others working in and around the administration because the hope of advancement trickles down. You only keep the old guy if things are going really well and there are no conflicts.
Robert Reich gave a speech to the commonwealth club in California back in January. The one thing he spoke about which we have not yet seen is changing the treatment of primary residence mortgages to allow for the same cram downs possible on non-primary residences. I wouldn't be surprised if there are now plans for some kind of policy reform, and that the Fed in its omni-regulator status might be important.
These appointments take time to produce. First there are interviews, then there is the vetting, then there is the grooming, then support must be rallied, then the transition, and finally taking office. It's likely that word from the long lead time in the process has made it to some of the people who are campaigning for Bernanke.
Bernanke could easily be reappointed, but I don't think that fits into the plan here. After lobbying, politics is all about vengeance. I expect there is a lot of regret in supporting Greenspan who was appointed by Reagan, and under that comparison the last Democratic newly appointed Chairman was Paul Volcker who still carries a very positive reputation.
If I know the Obama administration, there are a lot of plans and many are shelved for a second term. It wouldn't fit to have such ambitions and then give up an appointment to take on the net political liability of reappointing Bernanke.
Key to that train of thought is there are only 5 of 7 spots on the Fed Board of Governors filled right now, with a vacancy coming up for one of them soon. Obama has the opportunity to leave the biggest imprint on the Fed in a long time.
yossarian
regarding the vincennes
you overlook the point that we, the usa regretted our error, admitted we made a mistake and paid reparations to iranian families
big difference between pan am lockerbie scotland versus vincennes incident
Dollar as Good Store of Value Is ‘Questionable’
I don't know about that. The 'Dollar Store' near me has some pretty good root beer and they're usually good for some cheap glass vases or "disposable" tape measures (I keep losing them). I mean, it's only a penny more than the 99 cent Only Store.
no dont try that
lybian reparations were a long time coming and required some arm twisting
OT: I just posted a new article Shadow Inventory Does Not Exist
Just because I constantly see people talking about the large swaths of bank owned homes not yet on market I wanted to debunk that myth (at least for California).
There are a huge number of homes waiting to be foreclosed on.. but unless the banks ever foreclose on them they don't much matter to the market. The administration has so far derailed any attempts to bring on larger amounts of new supply despite the fact that many markets are running low on inventory and home sales are falling in those areas.
EHP
you wrote:
The people who make the appointment are politicians. It's not clear to me why any lobby groups would intervene to favor Bernanke over any possible replacement. Bernanke is a Republican appointed by Bush, and now there is a new team in power. `
Don't underestimate the value of the chance to appoint a friend, or reward some loyalty. It not only is a boost the appointed one, it improves the morale of others working in and around the administration because the hope of advancement trickles down. You only keep the old guy if things are going really well and there are no conflicts.""
.....
Following your logic that's why on May 2004 Greenspan was re-appointed by George W Bush. Please bear in mind that that same Fed chairman was blamed for his handling of monetary policy in the run-up to the 1991 recession which was criticized from the right as being excessively tight, and costing George H. W. Bush re-election.
"The 'Dollar Store' near me has some pretty good root beer..."
They have good cellophane tape too. Yeah, it's a good store of value.
Effective Demand,
If you ever see me talking about Shadow Inventory, I refer to homes that are likely to be sold soon enough, but not on the market yet. eg: vacant investment properties no longer rising in value, unemployed negative equity mortgage, paid off house which is hoping for a J shaped recovery in prices but will have to sell eventually to downsize to provide a boost to retirement funding, etc ..
`
If only 5mn houses can be foreclosed per year, it doesn't mean that there are not additional severely delinquent properties the bank has intentionally delayed taking possession of.
EHP
you also wrote - "politics is all about vengeance"
yep, that's why George rewarded Greenspan with a 4th re-up!
boy, when you wade into politics you're a babe in the woods, all due respect...
duke
Duke of Con Dao,
Interesting room for argument, but Bernanke was appointed to the board in Fall 2002 and very likely explicitly groomed to be Greenspan's (then age 76) replacement. Bernanke got the nod privately and left Princeton after the 04-05 academic year. So he probably got word in 2004, about a year after the economic turn around. So under your counter logic, the vengeance axiom (if present in this case) would appear to hold
* this post has been edited
@sdtfs
Your comment reminded me that tomorrow I must visit the Dollar Store of value and stock up on lint rollers.
EHP,
I think there is a tremendous amount of "latent" supply. But until it comes on market it doesn't much matter.
If the USG can keep housing in the doldrums for the next 15 years.. I think that would be just fine by them. We will have lower transactions and the issues will sit and fester but they are clearly going for stagnation.
p.s. 5 million foreclosures a year would be equal to the number of homes sold in a year. If we were at that level we'd be much closer to solving the problem.
If you ever see me talking about Shadow Inventory, I refer to:
empty buildings that don't have a sign out in front and no sign of what the heck is going on with them. I wonder if they're "private investor" owned property? An acquaintance oloaned on one that was supposed to be the site for a new house, but they (the dreamers) couldn't get it done, they took out the electric meter in the process and the city won't let him re-install it--a laundry list of code violations--so he's contemplating tearing the existing structure down and sitting on the lot for a long time.
I must visit the Dollar Store of value and stock up on lint rollers.
Yep, tons of awful cheap crap that's not worth having and a few (very few) things that ought to be a dollar, but are priced much higher at the local markets.
Whoever put this into the CR dictionary:
"Shadow Inventory: Foreclosed homes that lenders have not resold or listed for sale. By its very nature, the size of the shadow inventory is hard to estimate. Can also apply to homes kept off the market by owners who would like to sell but are waiting for prices to rise."
It actually isn't hard to estimate at all.. Foreclosures are a matter of public record. One can match up foreclosure data with MLS data to determine all the homes foreclosed on but not for sale.
It isn't nearly as large of number people want it to be.
Effective Demand,
I think the latent supply as you termed it, or shadow inventory as I call it, is extremely important. The reason why these homes are not on the market right now is because listings:sales is generally above 8 months nation wide. Years in the worst areas. If there is ever a real improvement, you will have a flood of properties try and take advantage. Which means prices cannot rise, because this shadow inventory keeps getting converted to real inventory.
The reason why banks are not rushing to foreclose is because there wouldn't be enough demand to sell them all if they tried selling all at once. The costs of a delinquent and foreclosed property are not equal. So the sales are being paced to an extent. Furthermore, it benefits them as mortgage servicers through higher fees. In the case of guaranteed mortgages, they can for example tack on all sorts of fees and interest which will be paid for by Freddie Mac (note: I may have been sloppy in my description of it, someone who'll read this should be able to clarify any mistake)
You have got to be kidding me if you think a house 18 months delinquent will stay off the market forever.
`
All that matters is the relative tightness of the local market. Below 4 is seller's market, 6 is neutral, 8 months and up is buyer's market or falling prices. Try a regression on your local market comparing monthly or quarterly listings to sales. Call it EHP's law. It is solid. The only difference between 8 and 10 months of inventory is how fast the price falls, but it will fall. As long as prices fall, the pain continues. As soon as listed inventory goes down, shadow inventory will step in to keep the price declines on cruise control. There is enough shadow inventory to make sure prices will stay down for years.
about the 5mn foreclosures,
I considered the impact of the moratoriums, and guesstimated what the annual throughput might be if banks push to clear their backlog. Even at 5mn annually, that could likely take several years to clear.
Re: "Policy makers in the U.S. and Europe have flooded the global economy with liquidity, which could lead to speculative bubbles due to limited opportunities for investment, he said. Stiglitz said he was not confident of the Fed’s claim that it would withdraw liquidity when needed."
They are forgetting Japan's 20 wave of ZIRP, quantitative easing, and fiscal stimulus which has never been reversed. If it were reversed now, Japan's economy would nose-dive again.
How come no one ever sends me the memo the day before Im supposed to get on the AIG FRE FNM bandwagon? And when I accidentally hitch a ride, how come they conveniently forget to tell me to get off at my stop?
Effective Demand,
I didn't write that CR dictionary entry, but your answer is in your post.
Can also apply to homes kept off the market by owners who would like to sell but are waiting for prices to rise
Shadow Inventory is not equal to Foreclosures.
Sometimes it is Joe and Jill retiree just waiting for the "right time" to sell, and they do have a longer timeframe to sell but it is not infinite
`
I think you might be confused where your terminology conflicts with what appears to be a commonly accepted definition of shadow inventory. It might be stories about vulture investors tallying the # of bank owned properties in an area doing this. I can tell you those investors do not care if the bank has foreclosed or not, they care if the loan is delinquent and unlikely to self-cure. Vacant homes, yard/vehicle sales, and others are good indicators of a delinquent loan staying delinquent especially when it is negative equity
Why is the BFF Poll closed already?
EHP,
Maybe I'm not making myself clear but I think the USG is aiming for stagnation.
"All that matters is the relative tightness of the local market. Below 4 is seller's market, 6 is neutral, 8 months and up is buyer's market or falling prices. "
California's unsold inventory index stands at 4.1 months in June....
The reason that means it isnt a sellers market is because most sellers can't sell and buyers have no additional pricing power. The people who do have pricing power are the guys buying at trustee sales, they get the houses in the hottest segment... the low end (where in many places there is less than 2 months supply on market) and price above REO but below unrealistic seller retail and make bank.
This is an experiment, keep your pants on:
An Ordered List:
Doc, Stiglitz is talking about this:
St. Louis Fed: Series: EXCRESNS, Excess Reserves of Depository Institutions
EHP,
"I think you might be confused where your terminology conflicts with what appears to be a commonly accepted definition of shadow inventory."
Funny, I run into the term shadow inventory all the time all over the web and the people are almost always talking about the belief that bank owned properties are being withheld from market.
My posts tonight was saying, If you believe that is true.. You are quite wrong.
So far the market in California is SUPPLY CONSTRAINED.. the issue isn't that there is too much inventory.. There is currently not enough!
The last time that 4 months inventory came up, I remember saying I don't care how it was achieved because it was impressive. Then someone informed me about some interference in the data, can't remember what it was. Might even have been the FTHB credit scheduled expiry + a hot FHA lending market + mostly low end.
`
I know you collect/sort some great data, I've been to your blog again and again just to look at the invisible FHA hand act on the charts. You also know California where this tight supply is registered. I'm just not clear how a policy of stagnation would be directed from the top, how it could resist natural pressures, and what the exit plan would be.
mp,
This is kinda funny from several months ago:
How Non-Borrowed Reserves Became a Sexy Subject: Caroline Baum
How Non-Borrowed Reserves Became a Sexy Subject: Caroline Baum - Bloomberg.com
All of a sudden, people who never glanced at the Fed's H.3 statistical release are now experts on ``Aggregate Reserves of Depository Institutions and the Monetary Base.'' Their e-mails have the same sense of foreboding as the missives put out by the Black Helicopter/Tin-Foil Hat crowd.
What if the Fed's rate cuts aren't motivated by the desire to stave off recession, rather to prevent a major banking crisis?'' one e-mail read.The Fed's not telling anyone what it's up to because it doesn't want to cause panic, but the evidence is there in its own data.'' (Gosh, you'd think it would do a better job of hiding it. Maybe send H.3 to join M3!)
I have concocted a platform for the non-Obama Democrats for the 2010 mid-term elections(given that the President is pwned by Wall Street:
Regulation, Repatriation and Reorganization, along wih Hemp, Handguns and Healthcare reform.
... The negative number is really an accounting quirk: If banks borrow more than they need, non-borrowed reserves are a negative number.
Effective Demand,
If it helps at all, I am sure I don't disagree with you in fact, and more than likely you are correctly chastising people who believe banks are withholding foreclosed properties from the market. There was a wave of stupidity across the internet recently complaining the FDIC was broke that drew a lot of attention, meanwhile how many hugely important issues have they ignored in the last year or two. It's a matter of not understanding ones' own limitations in discussion.
re:Stiglitz Says Dollar as Good Store of Value Is ‘Questionable’
No other currency fronts an economy that can handle being the reserve, though it's the utopian dream of the ECB.
That's part of the situation ...the arbiters of the post WW2 order - the IMF, G7/8/20, and World Bank are tottering.
the dollar as reserve currency along with them..
From Yves on a tsunami of liquidity:
UBS Raises Concern About Negative Non-Borrowed Bank Reserves « naked capitalism
To reiterate: the negative non-borrowed reserves are not the real issue; the question is whether banks have become reliant on the TAF. In this bad credit market, when the Fed is on a program to ease aggressively, the Fed is not going to tinker with the TAF whether or not there is still a real need for it. Thus we mere mortals outside the regulatory regime will remain largely in the dark as to whether it is a prop or a mere expedient.
purple,
Your blog is good.
nice to see you
From Caroline Baum's article-- "This gentleman is overlooking the fact that the Fed is a monopoly provider of reserves,'' said Jim Glassman, senior U.S. economist at JPMorgan Chase & Co.This is a non-starter. There is no such thing as a banking system short of reserves. The Fed has absolute control over the supply.''"
Well, we know how that turned out, don't we?
For example, Cracking China's Banking System is well worth a read. You say "To an extent, it doesn't matter how much industry is given up to East Asia, as long as U.S. finance capital interests feel they will ultimately control the levers of that region." If true, this goes a long way towards explaining US policy toward China.
Funny, I run into the term shadow inventory all the time all over the web
Yeah, I'm guilty of using it to describe anything I don't understand about the "inventory" of housing,...so you can see it covers a lot of territory!
"Then someone informed me about some interference in the data, can't remember what it was."
I think thats the point, the whole market is highly engineered. Stopping banks from foreclosing, telling servicers to modify even if the investor of the loan doesn't want to and giving them legal protection to do so, FTHB tax credit, $1.25 trillion in printed money to buy MBS, $300 billion in printed money to buy Treasuries and $200 billion in printed money to buy agency debt.
All designed to prevent deflation.
How does it end? Thats the million dollar question I don't hope to know the answer to, but I can tell what is happening at this moment in time.. And that is stagnation.
I keep on thinking they can't keep this up and alternatively thinking there is no way they'll stop anytime soon.
Many people use it as a defintion of bank owned homes not for sale on the market:
Banks aren't reselling many foreclosed homes
Shadow Housing Inventory? Only the Banks Know - CNBC
Is REO inventory hidden in the shadows? | ForeclosureTruth
Are Banks Holding a Shadow Inventory of Homes? - Developments - WSJ
http://www.voiceofsandiego.org/articles/2009/05/06/toscano/717shadowinventory042109.txt
Shadow Housing Inventory: The Deception of the Foreclosure Numbers and the real REO Picture. A Case Study of Southern California Real Estate. How 40,000 Homes are Hidden From Public View by Banks. » Dr. Housing Bubble Blog
Just as many people use it for the whole world of inventory wanting to sell but not on market.
My blog post was directed for the former not the latter.
Not sure if this will post, but this FRED indicates that banks are being pumped with liquidity and remain addicted to artificial life support, which includes accounting fraud, blessed by Uncle Sam. I posted a Yahoo screen earlier and the vast majority of corporations out there are void of earnings -- as they write off more and more impaired goodwill-kinda stuff. We essentially have a banking system that is crashed, and a capitalist system which has failed, yet to keep the game going, a trade-off exists that allows the dead beast to live as a zombie, and as such, the fantasy can continue, until ..... the burden becomes so great that the myth can no longer be justified.
we know how that turned out, don't we?
http://research.stlouisfed.org/fred2/graph/?chart_type=line&s[1][id]=EXCRESNS&s[1][range]=5yrs
"We essentially have a banking system that is crashed..."
Undoubtedly.
"and a capitalist system which has failed..."
Stiglitz said that.
"yet to keep the game going, a trade-off exists that allows the dead beast to live as a zombie..."
Yeah, they're protecting the institutions.
"and as such, the fantasy can continue, until ..... the burden becomes so great that the myth can no longer be justified."
Yeah, well, fasten your seat belt.
Effective Demand,
I just don't see how a policy of stagnation can sustain itself long enough for it to be considered a policy. I would consider those actions and results to be a temporal feature of trying to substitute increased public debt for defaulting private debt, which itself has its own limitations. It hasn't stopped the price declines, even though it was combined with the seasonal bump which is naturally getting more significant. We've got another year of heavy inventory guaranteed. So time will march on, heeding no distractions
`
good night, too tired to make coherent word structures now
Effective Demand,
If there was a bank owned property not on the market, I would consider that to be a part of shadow inventory. That category is a very small part of shadow inventory. However I concede there are stupid people who are prone to beliefs in irrationally complex conspiracies and in doing so hijack an existing term, and you may sully their stupid names with my blessing
Ok, I did my part, I download the data and came up with an average EXCRESNS of 115.801 for the period between 2004-07-01 and 2009-07-01, and of course the latest period has an EXCRESNS value of 732.994, which seems a tad highrer than the average range, but maybe yah just need a puff on
to understand whta's going on there..... I really can't say, because I'm just wearing 
and have about as much clothing on as a 
I'm trying to find that story where Paulson and Bernanke were in a panic about TARP and the whole system was going to crash in like 24 hours... remember that moment?
Theoretically, the $732 could be loaned out. If you use a reserve ratio of 20%, it means the commercial banks could create roughly four times that amount in commercial bank cash, or 2.928 trillion. That, of course, would zoom M2.
But, the banks aren't lending it because they don't trust anyone and they can earn interest on that money risk free by depositing it at the Fed.
The trick is, Bernanke must figure out how to pull that money back as the banks begin to loan it out, and do it without stalling the economy.
"remember that moment? "
Vividly.
When meant when I said unless they foreclose on those homes they don't much matter to the market..
Take me for example, I am a well qualified buyer looking to buy but finding nothing I'm willing to pay for. All those owners wanting to sell but unable to get the price they won't dont matter at all to me..
Only people listing at market prices matter. Someday, hopefully soon, that latent supply will hit the market. But right now the market is supply constrained (in CA) and buyers are unable to buy. If the fed can keep only REO / Short sale supply on the market and all the other sellers off the market that is a perfect market in which to liquidate that supply, the banks can meter it out without flooding the market.. they will control the supply and the demand very tightly.
If you wanted to buy in the next two years and the Fed holds off supply for the next 5 years.. all that latent supply doesn't help you one bit.
This is close enough: "On September 17 and 18, Paulson, along with Federal Reserve chairman Ben Bernanke, scared the bejesus out of Congress, when in private meetings they told legislative leaders that the world financial system was perhaps only hours away from full collapse without the sort of assistance that became the TARP. Therefore, it was most surprising that, following its final codification into law, Paulson displayed absolutely no haste in implementing it."
Ok, the deal here is, the system did crash and burn and the alternative is that you either save the banks and all the infrastructure and keep all the crooks in place to run the crooked system, or you let it crash and go into freefall -- they all decided that the devil we knew, was better than the devil that may come about, if chaos takes hold. We have thus ended up with a system that doesn't need earnings or accounting, auditing or honesty, but by God, we have a system!
remember that moment?
No. Tell us about it.
Just kidding.
Googled:"This Sucker Could Go Down" | The Big Money
Sep 26, 2008 ... "Chaos," "disarray," "unprecedented politic
There was some reference as to how fast the run on the system was going and that within 24 hours the Treasury would be wiped out .... ahhh yes....
"...but by God, we have a system! "
That's what it's about. That's what it's always about. It's about protecting the system.
At any cost.
To all a good night, day, whatever.
so much for BO asking for Khadaffi's assurances not to hold a hero's welcome...
NY Times :
Ignoring American demands that Mr. Megrahi not be celebrated as a hero returning to his homeland, hundreds of young Libyans were bused to the military airport in Tripoli to welcome him home, cheering and waving Libyan and Scottish flags as he sped off in a convoy of white vehicles.
so much for BO asking for Khadaffi's assurances not to hold a hero's welcome...
And all this time I was blaming Dubya,... looks like they're pumping stupid gas into the Oval Office.
Before I take off my
it does interest me that in this economic black hole that we are connected to, a place where future valuation has no meaning or less meaning than the disconnection to the past, so where are we? The illusions of 
and 
are both on a distant horizon at the end of a tunnel and from where we are now, the only way to keep going forward is to allow fraud to fuel the fires, so that at some point, the journey out of darkness takes us to a place of stability -- out of fear.
OT: "Marlow learns that he is to travel up the river to retrieve Kurtz (if he is alive), who was evidently left alone in unfamiliar territory. However, Marlow's steamer needs extensive repairs, and he cannot leave until he receives rivets, which take a suspiciously long time to arrive. Marlow suspects the manager of deliberately delaying his trip to prevent Kurtz from stealing the manager's job.
Marlow is finally able to leave on his journey with five other white men and a group of cannibals they have hired to run the steamer. He notes that the cannibals use a respectable amount of restraint in not eating the white men, as their only food source is a small amount of rotting hippo meat, and they far outnumber the white men, or "pilgrims" as Marlow refers to them."
Intro Apocalypse Now
YouTube - Intro Apocalypse Now
Heart of Darkness-
He has to live in the midst of the incomprehensible, which is also detestable. And it has a fascination, too, that goes to work upon him. The fascination of the abomination--you know. Imagine the growing regrets, the longing to escape, the powerless disgust, the surrender, the hate."
...They were conquerors, and for that you want only brute force-- nothing to boast of, when you have it, since your strength is just an accident arising from the weakness of others. They grabbed what they could get for the sake of what was to be got. It was just robbery with violence, aggravated murder on a great scale, and men going at it blind--as is very proper for those who tackle a darkness. The conquest of the earth, which mostly means the taking it away from those who have a different complexion or slightly flatter noses than ourselves, is not a pretty thing when you look into it too much. What redeems it is the idea only. An idea at the back of it; not a sentimental pretense but an idea; and an unselfish belief in the idea--something you can set up, and bow down before, and offer a sacrifice to. . . ."
delete
OT--
CR,
Is it possible for you to do a post a la Tanta regarding how and when servicer deal with the cash flow issues for mortgage delinquency? I remembered reading somewhere that servicers will advance the interests portion to the investors while charging and keeping the late fees. Also I think after 90 days the servicer stop doing this and start foreclosure proceedings. In the meantime, many of the delinquent debtors are not paying thus must present a big cash flow problem for servicer. It is just strange that we rarely hear any mentioned of this when MSM covered the foreclosures and NODs. Is it because no one really knows that answer?
Thanks,
Mike
"One banking lawyer who asked not to be identified describes the result as a "wonderful chain of stupidity."
.........THAT'S the pandemic disease we need to worry about.
But, but he didn't say contained.
Speaking of the 'c' word, Cramer said yesterday that CRE was 'contained."
...Cramer is "figuratively" a cheaper whore than any of the ones on any MLK Blvd. I don't mean to discredit any Ladies of the Evening.
Alright CR community.
My #1 Premium BFF Poll is open at the Polls link.
what is it with these people- can't they recognize the simple truth "if you are spending more than you are earning and the bank won't lend you any more the solution is not to ask for a loan from Daddy"
The problem is not that aggregate demand is low now but rather that it was too high earlier. We should be working towards an economy that is able to sustain itself without requiring consumers to constantly go deeper into debt relative to income.
How are Belle and Milkshake these days, BSR?
edit
Hey, BSR, we gots us a MLK Blvd here too. I betcha our hos is older, uglier, and skankier dan yo hos.
CDC: No ‘red flags’ in swine flu vaccine tests - Swine flu- msnbc.com
WHO Predicts Explosion of Swine Flu....
I guess with fewer people alive, that's more ponies for the survivors!
TAKE THE MARKET ON THAT!
Some things are best explained simply:
YouTube - Ron White - Stupid is forever
San Fran- The City of Toothpicks.
404 - Not Found - sacbee.com
Tater Salad!!!
LOL.......They're all great, HomeG....even the new latest worthless horse, "Sparticus". He IS a keeper though. 1/2 quarterhorse, 1/2 fjord (a Norwegian draft horse) - pretty much bombproof. The girls sure don't know what to make of him though. We had ALL the livestock loose earlier when Belle & Sparticus stared snortin' and acting all rodeo.......and broke through the corral fencing. Rounding everyone up took hours. I keep saying I'm too old for this........
Belle wants to be the pack leader!
ROFL.....Perfect, volker..........You can't fix stupid........
Hell - Belle never knows what she wants. At 1/2 a ton though, you listen to her.
yes blog is good and main thing is its full of information i am getting allot knowledge form this blog hope so you will be getting in the same way !
-- Link deleted by kcoop --
homegnome
can i do bff today? did it yesterday (hangs head down)?????
I opened my Premium #1 BFF poll is morning, gaby.
No 34 failure pick though.
So feel free to participate!
Hey look everybody, a corporate shill called
jamesparker
ripping off old folks who need money
Hey, Mr and Mrs Geezer, I give you 50 cent on the dollar fo yo place and you gets to stay til you die. When you die, I be getting yo house and yo kids can kiss my ass, how bout dat?
volker you are on a roll this morning!
it's a continues down fall of American banks and now the assets of the Guaranty Bank of taxas are sold out to Spanish bank . now this is the time to think carefully and take out our country form this misery!
-- Link deleted by kcoop --
jamesparker,
Just how poor were all the folks on Wall Street., politicians who took bribes etc.
Poverty will always be with us- no matter how rich a society. Those on the bottom will always consider themselves or be considered poor. Virtually everybody who is considered poor in the United States would be considered well off in many parts of the world.
It is my understanding (source our police chief) that the research has shown that justice needs to be swift and sure not punitive to be effective. We have elected for punitive rather than swift and sure.
jamesparker - I'm sure your numbers make as much sense as your words.
Begone.
C
Dear jamesparker,
Consider enrolling in a course for ESL. You can look it up, just google English as Second Language. Meanwhile, you need to either get your more smarter than you relative to type for you or else go back to the Wok and Roll and turn out some more spring rolls.
Yes Doc i remember this story but that might be a changing time because when you gain some pain then a relief is waiting you what you say?
-- Link deleted by kcoop --
OMG, he bought the brain-damaged bot! Cheapskate.
C
C: or else he/she is using Babelfish
hours of funfunfun for the whole fambly
Yahoo! Babel Fish - Text Translation and Web Page Translation
what is your answer for Mr and Mrs Geezer. They have no cash but a lot of equity in their home. Do you want them to move, sell their house move into a tiny little place so that they can give children something?
BTW in the US the lender doesn't get the house. They get the proceeds sufficient to cover their interest and principal and the balance goes to the heirs.
Fannie requires that anybody who gets a reverse mortgage must get counseling first. Could we build additional safe guards, lower fees and move it into mainstream lending sure- but to blame the instrument or the concept outright makes no sense.
Hi dear Volcker!
Thanks for a kind advice my dear! i hope so you did the same thing thats why you are sharing your won opinion i am actually not very much satisfied with the current economical phase !it's not good my friend so we have to think and make some thing usefull for our country!
-- Link deleted by kcoop --
Actually, we could have some fun with this. It's not going to pass the Turing any time soon, but maybe it can be lured into saying something libelous.
C
Could we at least get a bot that speaks Jas?
homegnome
okay thank you and later on the 34 pick after they get jax office open,okay?
Ignore the
!
Ken will take care of it.
My dear Crazyv my answer will be for Mr and Mrs Geezer if they don't have cash then they should have to wait but dnt sale your home it's a precious thing that you have !
every problem gets finished when you be patiently so wait for a good time and try to bring that time earlier with your efforts !
-- Link deleted by kcoop --
From the WTF Files:
Seller, beware: Feds cracking down on garage sales
Seller, beware: Feds cracking down on garage sales | McClatchy
I really should NOT be surprised by the stupidity these days, but I still am.
Hi dear you wanna say something to me ?i know you are the king of this ring? might be confusion mate?clear it!
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Dear Jamesparker
What a crisis. My woes and wants:
Constant fear.
Pain.
Widespread medical malpractice allegations.
Guaranteed ligitation success?
Fraud.
Reverse mortgage is the answer?
This country. I weep.
C
Just a reminder that my #1 Premium BFF Poll is open at the Polls link.
BFF!
BFF!
BFF!
Dear counter pointer !
relax i am here and i am a regular reader of this blog it's really a nice blog i want to buy a home but finding and searching some good ways that how to get home and then how it will be reliable for the future!can you help me on this matter?
answer me my friend!
I am not happy with the current situation as the us banks are not safe here? banks are continuously selling is there any one who can tell me that what's going on here?
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homegnome
we really need to do something about the media. this will the second time in two weeks that they have "forced" a bf on us.
we are not supposed to have outside interference on this! this is our bff. small snide remark off
besides it messes up the count.
your thoughts are not very much convicted my dear try to think and then answer !
are your sure ?
-- Link deleted by kcoop --
These guys will tell you all you need or deserve to know:
Interesting Finance & Economic articles
Gabyjan,
homegnome
thank you
I smell bacon...
"Guaranty is one of thousands of banks that invested in such securities ..."
...........and one of the thousands that are insolvent.
Lets hope the FDIC does their job today.
black star ranch
everyone invested in those nasty things, in fact i wouldnt be suprised if ss didnt.
Does anyone ask or answer the question "who marketed these securities to banks"? That might seem irrelevant, but like we have all agreed, bank CFO's are not the sharpest cat's around, these were actively sold, not actively purchased.
can i have a cup of coffee?i want to thank you to the homgone that you share a good site with me!thanks mate !
Reverse mortgage
....the sooner we weed out the derelict banks, the sooner we can get to the Main Event. Just another layer of skin peeled back to expose the REAL disease.
spider: Saw an interveiw with a little lady Mayor in Iceland, town lost every dime. She stated these securities were sold by Men in three piece suits who looked like Male Models who had been teaching Seccurities Investment to the US Treasury Officials. We all can be hazzzzzzzzzzd.
good salespeople very good..greed played a big part,and lets not forget peer presure.
didnt anyone stop and think what if? no because they stupid.
kcoop
we really need a dumb a$$ icon
The FDIC is on a drip drip drip system, seen or heard that from anyone else lately.
Futures look solid this morning. Hard to imagine anything other than a cataclysmic outside event pulling market down. There is no data which can not be dwarfed in the aggregate by spin and a barrage of positive headlines. Its unfortunate my gut does not allow me to participate.
Suuuuuuuuuuueeeeeee!
Here piggie!
My vote: 5 banks fail.
--bh
My #1 Premium BFF Poll is open at the Polls link, blackhat.
Thanks for participating.
Black Star Ranch (profile) wrote on Fri, 8/21/2009 - 8:38 am
....the sooner we weed out the derelict banks, the sooner we can get to the Main Event. Just another layer of skin peeled back to expose the REAL disease.
That kind of radical procedure might cause the patient to go into shock and die. I think the plan may be to try and wean it off the controlled (addictive) substance slowly. Of course, it's difficult to get off the juice when they actually keep pumping in more than ever. Damn, this analogy sucks