I'm ascending to Heavenly, adios.

At this rate, we're probably going to surpass but the issue is also going to be the FDIC fund balance and how many other banks will be willing to take on the toxic assets.

Or not.

CR - where is the bank list? Did the guy who used to send it to you go on strike?

Love to see a chart of that data showing the potential 'shadow inventory' of future bank failures & current 'turns' required to clean up. My guess is that visual wouldn't be real pretty.

Mish's Global Economic Trend Analysis: Warning For Novices: Please Avoid Foreclosure Auctions

"
Samuel Sontag, a New Yorker bid $95,600 for the right to pay off a $13,000 Miami Beach condo association lien. After wiring $95,600 to the county for what he thought was a clear title to a one-bedroom condo in Miami Beach, Sontag got a call from a Sarasota woman who told him that IndyMac Federal Bank had a superior lien on n the property and there was an outstanding $265,000 mortgage.
"

Bummer!

Cog, lie, flatter, and face,
Four ways in Court to win men grace.
If thou be thrall to none of these,
Away, good Piers! Home, John Cheese!

Roger Ascham - Wikipedia, the free encyclopedia
-four cardinal virtues in demand at the court of the Queen.

FJ2

Will A Loan Modification Affect Your Credit?

OT, but slow morning anyway.

In my teen's tax refund check envelope was an advertisement for buying US Treasury investments (treasurydirect.gov). I haven't received a refund in years, so I don't know if this is something new or if they've always done this, but I thought it looked a little like desperation.

MommyKnows wrote:

My guess is they had a few reasonable offers. Just no reasonable responses to them. Today's insulting lowball is next year's $10k over list sale price.

Ding ding ding! Made an offer on a house in the energy corridor area of Houston, offered to take out the owner for what I thought his purchase price was in 2002...which was ~15% haircut from current asking, this after being on the market for ~15 months (and current asking down 20% from initial asking). His agent: "It's already priced less than its worth."

Reminds me of one of my cousins recent experience in CA, my uncle passed away a bit over a year ago and she was selling the house...turned down an offer early on as 'too low', ended up selling recently for $70K less than that offer.

energyecon wrote:

Reminds me of one of my cousins recent experience in CA, my uncle passed away a bit over a year ago and she was selling the house...turned down an offer early on as 'too low', ended up selling recently for $70K less than that offer.

The more that stories like that become known, the faster a rational market will return.

JP wrote:

The fact that there is not a single database in the year 2010 to make title obvious causes me

Just for fun--I recommend this SEC link. It links to a typical FWP filing on the SEC--a WAMU trust. Just scroll down these properties and consider--each property can be taken out once a month and shoved into a new trust. (Unless the payments are 3 months behind--in which case it is removed from the trust to be paid by the insurer.) But--no wonder why title is cloudy/murky. It's meant to be cloudy/murky--banks wouldn't want any investors to be able to go back and check to see if they had ever actually "owned" anything, would they?

SEC Info - WaMu Asset Acceptance Corp - FWP - Washington Mutual Mortgage Pass-Through Certificates/WMALT Series 2006-AR6 - On 7/26/06

Pearl wrote:

urthermore, title insurance companies can rescind a policy after purchase--which basically means--they can just give you your ($1,000?) back for the policy after an issue arises and consider things even.

No, they can't. I call BS. Cite your references.

Title insurance covers to the policy limit. They can pay your policy limit (e.g., $300,000), but not just give you your premium back (e.g., $1000).

homedad43,

Great "family meal" article! Instantly took me back to my youth. By the time I was a teenager ours was often a "family & friends meal" too, as anyone who was over to play that day was invited to stay for dinner, and mom was a wonderful cook.

A oil lease broker for whom I worked for long ago, occasionally won an oil lease at a US government auction. One of the major oil companies would soon call him and make him an offer. He always took it. He died a self made millionaire and make his three SILs millionaires, too.

Interesting. This may still be possible in the UK, as one of my dad's business friends pulled off something like this. Rich, but not super rich.

I also want to add in my solution to this systemic failure and that is for the FDIC to lower its current manipulated deposit guarantee of $250,000 back down to $100,000 or less. The result would be a panic by average people, to bail out of shitty banks, and search very hard for banks that are run like Swiss watches, which have accountability ..... the only problem is the FASB, FDIC, SEC, DOJ and all the other American agencies that look the other way, as they go about helping there mafia buddies/relatives abuse the systems! Once the money flows into the solvent banks, the market will find realistic equilibrium .... instead of the synthetic/manipulated corrupt consolidation of small shitty banks being rolled into bigger unsafe risky banks that have bigger that take on bigger casino bets!

OT monetary capture of government pharma

The Legacy of Billy Tauzin: The White House-PhRMA Deal — Making Government Transparent and Accountable - Sunlight Foundation Blog

one icon lacking and increasingly necessary: the all-seeing eye in the pyramid

I wonder how much of this banking crisis is due to incompetence and how much is due to corruption. Al, the old, crusty real estate banker has convinced me that it's very difficult and a lot of hard work to do everything necessary for a successful CRE deal. The bank still keeps him around to say "no" and "have you thought about this ?".

I think inflation made incompetent bankers look like superstars until the bubble ended.

I can image that the FDIC has a war room and a map of the banks they will close and they simply shape the system the way they want and re-engineer the banking environment with the banks they want in place -- this is like a drug cartel taking out the competition and then making sure that drugs can be efficiently delivered to the addicts who need credit cards....

It's my great pleasure to rant and rave and toss out some posts, but I have to get "work" done and then enjoy Spring weather and work on the tan. Work, work, work....

energyecon wrote:

Maybe we fell below some critical threshold of 'Crusty Al's' - as some critical level of institutional memory was lost and subverted, this latest bubble came into being - human nature being what it is...thus the trouble I have with the meme of 'impossible to predict outcomes.'

My personal experience places the loss of human judgement from banks sometime in the late eighties.

After graduating, I was broke and needed an overdraft. I visited my bank manager, and he pretty soon uttered the words 'need to run it through the computer'.

Until then, I'd always imagined bank managers as, well, managers and captains of their ship.

Yeah, just had to listen to the ADT door-to-door guy, again.

Man that must suck, listening to them is bad enough. I hope he managed to heloc and at least own a jet-ski for a while.

mix up?

Citigroup Warns Customers It May Refuse To Allow Withdrawals

nova wrote:
There is a God or Karma. Cast bread upon the waters without worrying about who gets it.
Blogs, blog commentary and novels count here

nova wrote:

No one here knows the future. Some see glimpses better than others. None of it on a macro level is good.
I have a choice. Live my life and plan for what I can. Make friends and listen to people.
There is a God or Karma. Cast bread upon the waters without worrying about who gets it.
Shit never happens the way you think it will. Relax and love my family now.
Fear, anxiety, and being an asshole do nothing for anyone and usually cause more problems then it is worth.

The one minute Desiderata?

Max Ehrmann's "Desiderata"

nova wrote:

I just read the last thread and this one on an empty stomach and 2 cups of coffee. My anxiety alarm is clamoring away. Not an unusual thing after reading posts here.

I put up a lot of content in the last thread. Am I responsible for some of your distress?

RD, I like almost all your posts. They ring true to me which means they are high in fiber content.

nova wrote:
They ring true to me which means they are high in fiber content.
Perhaps -fiber is the true substance of reality?!

Another anecdote from the real world on our V recovery.

Talked to a friend yesterday who owns a ~50 man HVAC company in nova. Things are DEAD. He said it was very unusual considering how cold it has been. Last year they layed off 7 people for the first time ever. Payroll is $45K/week and if things don't change soon another round of layoffs.

energyecon wrote:
Actually, in a yin-yang duality the and forces exactly balance out...one of them there conservation law thingies...
The is immaterial, and the material... both necessary. Unbalanced, one would deny the world, the other would annihilate it.

hopeful

charles hugh smith-The Wider Context for Twenty-Somethings (Gen Y) in America

Ultra High-end homes getting hit:

High-end home sellers lower their sights - latimes.com

nova wrote:

RD, I like almost all your posts. They ring true to me which means they are high in fiber content.

Funny. I don't see it as doomish. Saw it coming, got out of the way. See it continuing and sitting tight. When I see the bottom I'll be there aggressively. And I'm far from perfect. I didn't see March through Nov stock prices. I can't even build a model in retrospect that justifies the price moves. That is my doom moment. We've entered situations that defy analysis. The first great depression was full of those moments where people were bewildered by things just stopping.

dryfly wrote:

I wonder if Sheila has weekly 'production meetings' where her managers all get together [or video conference] and go over the existing back log - new orders - immediate 'drop ins' - weekly planned schedule and of course 'adjustments & fire storms'.

No kidding, I would love to have any insight into what the decision process is over there. (And not just so I could rule on the BFF poll.)

The Schmidt Sting Pain Index or The Justin O. Schmidt Pain Index is a pain scale rating the relative pain caused by different Hymenopteran stings. It is mainly the work of Justin O. Schmidt, an entomologist at the Carl Hayden Bee Research Center. Schmidt has published a number of papers on the subject and claims to have been stung by the majority of stinging Hymenoptera.....

Subsequently, Schmidt has refined his scale, culminating in a paper published in 1990 which classifies the stings of 78 species and 41 genera of Hymenoptera. Notably, Schmidt described some of the experiences in vivid and colorful detail:

• • 1.0 Sweat bee: Light, ephemeral, almost fruity. A tiny spark has singed a single hair on your arm.
  • 1.2 Fire ant: Sharp, sudden, mildly alarming. Like walking across a shag carpet & reaching for the light switch.
  • 1.8 Bullhorn acacia ant: A rare, piercing, elevated sort of pain. Someone has fired a staple into your cheek.
  • 2.0 Bald-faced hornet: Rich, hearty, slightly crunchy. Similar to getting your hand mashed in a revolving door.
  • 2.0 Yellowjacket: Hot and smoky, almost irreverent. Imagine W. C. Fields extinguishing a cigar on your tongue.
  • 2.x Honey bee and European hornet: Like a matchhead that flips off and burns on your skin.
  • 3.0 Red harvester ant: Bold and unrelenting. Somebody is using a drill to excavate your ingrown toenail.
  • 3.0 Paper wasp: Caustic & burning. Distinctly bitter aftertaste. Like spilling a beaker of hydrochloric acid on a paper cut.
  • 4.0 Tarantula hawk: Blinding, fierce, shockingly electric. A running hair drier has been dropped into your bubble bath.
  • 4.0+ Bullet ant: Pure, intense, brilliant pain. Like fire-walking over flaming charcoal with a 3-inch rusty nail in your heel.*

-- Abstracted from The Free Dictionary.

Question:

How do these stings compare with being stung by a financial invertebrate?

Max Ehrmann's "Desiderata"

That's beautiful.

pavel.chichikov wrote:

How do these stings compare with being stung by a financial invertebrate?

Box jellyfish - Wikipedia, the free encyclopedia

Along with Chironex fleckeri, Carukia barnesi and Malo kingi are amongst the most venomous creatures in the world. Stings from such species are excruciatingly painful, either initially or as an after-effect, and are often fatal to their prey and sometimes even for humans.

dr munch wrote:

Sold in 2009 for 2.1M

dr munch, do you know how much of the $1 mill loss was taken by the homeowner, and how much by a lender?

It makes a lot of sense, especially if the saving throws require easy numbers.

I didn't see March through Nov stock prices. I can't even build a model in retrospect that justifies the price moves. That is my doom moment. We've entered situations that defy analysis. The first great depression was full of those moments where people were bewildered by things just stopping.

We're dealing with aperiodic phenomena. No one can predict what will happen.

The homeower wrote a check to the bank for the full amount. He had the money and needed to protect his credit.

pavel.chichikov wrote:

Energyecon: Ja. I believe the Schmidt scale applies only to Hymenoptera.

Though I think the box jellyfish qualifies as an invertebrate working on Wall St

pavel.chichikov wrote:

No one can predict what will happen

The Week Magazine - News reviews and opinion, arts, entertainment & political cartoons

from the article
A government unhindered by limits retains the discretion to pick winners. A government that can make or break great fortunes invites a bruising and wasteful competition for its favor. It cannot be surprising, then, that those with the most -- thus most to lose -- assiduously seek favor from the state. It should not be surprising that those with powerful Washington connections are handsomely compensated by big special interests. And it should not be surprising when the well-connected exploit their relationships with people in power in the same way they maximize any other valuable asset.

energyecon wrote:

Reminds me of one of my cousins recent experience in CA, my uncle passed away a bit over a year ago and she was selling the house...turned down an offer early on as 'too low', ended up selling recently for $70K less than that offer.

Okay, I'll play the Devil's Advocate. That first offer was too low; the potential buyer doesn't have the house now, does he? The last offer is clearly the proper offer, acceptable to both parties. The difference in price is the effect of market forces, the premium your cousin had to forgo is the price of "peace of mind"; knowing that no one would pay a higher price now. If she had taken the first offer, she'd always wonder if the price should have been higher--- now, she knows that is not the case. Is that worth 70K? Efficient market theory says "Yes!"

pavel.chichikov wrote:

Thanks, energyecon. I think Bob's products are carried in our local food co-op.

Feeling the need to accentuate a bit of positive - not examining it too closely, just running with it:

With all its sham, drudgery, and broken dreams,
it is still a beautiful world.
Be cheerful.
Strive to be happy.
-- Max Ehrmann

Just came across a Craigslist add for a house full of furniture in LA county. Nice furniture, and a brand new pool heater as well.

There is also an anti government rant. "The government should understand what they caused and take responsibility". Seldom do I defend the government, but these asshats with a "bun in the oven" (as they put it) bought too much shit they couldn't afford.

energyecon wrote:

I call bullshit - and your typing with an economist here...

Okay, I'll change it to Dr. Pangloss says, "Yes!"

dr munch wrote:
Seldom do I defend the government, but these asshats with a "bun in the oven" (as they put it) bought too much shit they couldn't afford.
Yes. What Wall*Street and related con-men and predators did with that proclivity notwithstanding, a good deal of the present financial crisis is self-originated, and requires a mirror as part of the assigning of blame, as well as the assignment of reparations to be paid. Of course, those most hoodwinked are those most likely to look to looting others instead, to pay for their misfortune and cover up their poor judgment.

sdtfs wrote:

Okay, I'll change it to Dr. Pangloss says, "Yes!"

For a real economist on economist bitchslap contest check out Russ Roberts v. Brad DeLong: Page not found

pavel.chichikov wrote:
The system is what it is. It produces what it produces. Apple trees grow apples, box jellyfish produce little box jellyfish.
I couldn't agree more. If there is a problem with the product, there is a problem with the system tailored to produce it.

The CPI was bogus, apparently.

CPI Number Reported INTENTIONALLY INCORRECT? - The Market Ticker

pavel.chichikov wrote:

In a way I have no quarrel with Blankfein. He's doing what he gets paid to do. He's a product of natural selection. What does anyone expect?

We all get frustrated with how little impact any one of us has over the rules of society at large. Bad as things are now, if we all roll over passively in response to this, then things will be even worse. Did people 500 years ago look at the many horrors around them, that we have since nearly banished from the developed world, and declare that everything was the inevitable result of man's own nature?

A little righteous indignation over disappointed expectations is good, and can sometimes effect change.

energyecon wrote:
That sort of thing is why I ended up an "applied practitioner" as my best undergrad econ prof said when I disappointed him by going the MSc route
Yuck! That's like being an experimental physicist or a blue-collar academic that writes his own papers... talk about low-status. The real money is in presiding over enslaved brilliance and putting your name on the results, and in inventing elegant mathematical theories that don't apply to reality.

A little righteous indignation over disappointed expectations is good, and can sometimes effect change.

Nothing wrong with that.

Rajesh wrote:

Prime Minister says no money for Greece. Finance Minister say Germany's share is 4 billion Euros. Do these people ever meet?

You know they do, and the pretense that there will be no bailout is just that - a pretense.

Rajesh wrote:

Up to 25 billion euros in aid mulled for Greece: report | Reuters

That's the pro-rata equivalent of the US giving California $190 billion in aid.
It's like 8-9% of their entire GDP.

OT: I finished reading John Robb's Brave New War. Interesting read, and thanks to whoever it was that recommended it here. I don't have a lot to add to the reviews on Amazon other than these few things:

1. I like his proposed strategy of going to a distributed defense in depth.
2. I think he vastly underestimates the expense and political pushback of implementing his strategy.
3. The specifics in his problem analysis are getting a bit dated, but still make the point pretty well.
4. I don't think he makes his case for "The End of Globalization", and I suspect that his editor made him paste that into the title.

For those interested, here is the Amazon link:
Amazon.com: Brave New War: The Next Stage of Terrorism and the End of Globalization (9780470261958): John Robb, James Fallows: Books

Rajesh wrote:

Prime Minister says no money for Greece. Finance Minister say Germany's share is 4 billion Euros. Do these people ever meet?

They are both correct, read the article:

According to the German planning, the aid should be tied to strict conditions, the magazine said, adding that loan tranches should only be paid out once these are met.

energyecon wrote:

edit: and not pursuing the PhD

You cheated him out of a couple of years of free labor!

energyecon wrote:

According to the German planning, the aid should be tied to strict conditions, the magazine said, adding that loan tranches should only be paid out once these are met.

The strict conditions are for consumption by domestic German voters. If the conditions aren't met, they will be bent. We have all seen this movie many times by now.

There is a global excess of savings. That hasn't changed over the last 2 years. Until it does, loans will be made and not repaid.

Running live on a brand new Asus EEE netbook...slick. Replacing MSoft defaults in 3..2..1

rosethorn wrote:

Running live on a brand new Asus EEE netbook...slick. Replacing MSoft defaults in 3..2..1

One word: Hackintosh.

Greece is small potatoes, the real game in town is UK. 30 years of Mag Maggie politics and the country is ready for crash. Ireland will also suffer big time, thanks to living next to the bigger disaster island.

Rajesh wrote:

The real game

it's all a game

German Finance Minister: No Concrete Plan to Aid Greece

I'm going to get after writing this, but during the conference I was at yesterday the issue of the 'food crisis of 2008' was raised. The discussant recognized that many poorer countries had implemented 'food security and self-sufficiency' policies in reaction to the soft-commodity market chaos of 2008. This trend was 'troubling' to the speaker, because it would mean reduced exports for American agribusiness. Shortly thereafter, another speaker leapt to the microphone and ranted for five minutes on how organizations like USAID and CIDA were throwing grants (they should have been loans, she cried) at silly initiatives in developing countries and not demanding proper business plans and using good American know-how in the process.

I think I almost turned purple, and actually moved to the microphone to react before the moderator cut off discussion and closed the session. The problem that these countries have is that they've lost trust in the ability of the markets to provide them with food for their people at a reasonable cost and on a continuous basis. They've reacted perfectly rationally, by working on having domestic supply so that their government is not overthrown as a result of food riots.

The appropriate response is not to force these countries into trade agreements, or embark on a 20 year quest to build up domestic capacity (although that's by no means a bad thing), but to give them reason to trust the markets again. I did not once hear a reference to the Commodity Futures Modernization Act, nor any reference to grain reserves, or any other initiative that would ensure markets continually operated efficiently and with limited third-party interference (I'm looking at you, pension funds). What these countries want is a food supply they can count on, and the market mechanations of 2008 have scared the crap out of them. And I have not seen a single, I repeat, A SINGLE initiative that proposes to deal with the problems that led to that market chaos and volatility.

Anyway, I was pretty livid, and I usually don't get livid at these events. But this was ignorance to the highest degree.