Tuesday, March 2, 2010

Is It Any Wonder?

Late workout session so just a few items.

Greece on a Relative Basis
The Housing Time Bomb offers some thoughts on the relative "badness" of various countries as it relates to debt:
The Greece Fiscal Crisis: Throwing Stones at Glass Houses?
Good piece and I would add that scale matters. The size of the US and Japan issues make Greece look like a nanoparticle in comparison. Greece could get healthy on like 1/10 of an AIG bailout!

Double Dipping
Home sales, unemployment, you name it and it is going back the wrong way. Add in Car Sales as well via Calculated Risk:
US Light Vehicle Sales
There is just no way to see this stuff coming is there??

Gold and Silver Respond to the Printing Press
The metals were higher today and there were probably plenty of reasons for that, my favorites for the long term:
Fannie's On Balance-Sheet Loans Surged 900 Percent on January 1
Accounting changes balloon FNM mortgage holdings on the books. Now we know why the "not needed" expansion to infinite support for the firm was put in place. Backed by the US dollar baby!

Maybe the main reason real money is becoming more in need are stories like this one:
Kenneth Rogoff's Sovereign Debt Warnings Are So Wrong, It's Like He's Living In A Different Time Period
Author Marshall Auerback pens a wordy missive that boils down to (my take):
A country can print all the money it wants and there is no such thing as a spending constraint, well at least until one happens, but we are not there yet.
Something to that effect.

Have a good night.


GawainsGhost said...

Well, as far as the housing boom and bust goes, there was an interesting article in the newspaper about a major developer in this area, Casa Linda Homes.

These guys came down here from Houston in the late 90s and starting buiding subdivisions through the boom. These were cheap, cookie-cutter houses--3 bedroom, 2 bath, 1 living, 1 dining, small kitchen, 1-car garage with utility. And because they were built in bulk, they sold in the $70,000 to $100,000 price range (depending on location). Casa Linda used in-house financing, so they could service many of the low-income people who live in this area.

What's the problem with that? Glad you asked. Well, because the financing was done by the developer, there was no title company involved. In other words, no title insurance was issued.

Turns out that many of the home buyers got a nasty little surprise in the mail mere months after they purchased these homes. Casa Linda had never paid taxes on the lots they developed, which is something that would have had to be disclosed or would have been discovered had a title company been involved.

So these poor people bought these homes, moved in, and a few months later got a bill for delinquent taxes amounting to several thousand dollars. Naturally, they can't pay these taxes and now face imminent foreclosure.

The attorney general is now suing Casa Linda on behalf these home buyers, demanding payment of the delinquent taxes and punitive damages to the tune of $20,000 each.

Problem with that is Casa Linda shut down and left the area two years ago, when the bust occurred, and is in effect bankrupt.

What a mess. Fraud, deceit, dubious financing. Just another day in America, I guess.

regularly scheduled programming said...

Indeed there is just no way to see this stuff coming.

Like this graph on commercial mortgage delinquencies from Mish. You could stare at it for a year and never notice that they're 80% higher than mid-summer.


getyourselfconnected said...

Thanks as always for the inside story on real estate. I always look forward to your detailed reports.
How about a report on where Julius Peppers will wind up!?

That post by Mish had plenty of graphs that I think Bernanke should have to go through one by one in his next testimony, HA!

middle of the week is workout time so too short for a post. I should ahve time tomorrow so leave good story ideas here so I can steal them.

GawainsGhost said...

A report on where Julius Peppers will end up? I don't know, but I can pretty much guarantee it won't be in Dallas. So, other than that, I really don't care.

By the way, GYC, did you read what Sean Payton did to Jerry Jones at the Combine? Payton, as you know, used to work for Jones and had attended the Combine before with him, so he doubtless knew where Jerry liked to go. St. Elmo, the famous steak house in Indianapolis.

Friday night Payton and the Saints staff reserved a private dining room at St. Elmo. The waiter let it slip that Jones had reserved the same room for Saturday night and had called ahead to make sure that a particular bottle of wine, Caymus Special Selection cabernet sauvignon (very expensive) was to be served at dinner. Payton immediately ordered a bottle of the same wine, but the problem was that the restaurant only had one.

Now, I have no idea how Payton pulled this off (probably slipped the waiter a substantial tip), but he somehow got the bottle and promptly drank it. Then he took out a pen, and with instructions to the waiter to place the empty bottle on the table the next evening, wrote the following on the label:

World Champions XLIV
Sean Payton

That to me is beyond hilarious. Ballsy, just like his play calling.

It wouldn't surprise me in the least if New Orleans repeats this season. The Saints are the team to beat. And if they come to Dallas in September or October, I'm going to fly my brother down from Maine and go to that game.

I'm going to fly my brother down for a game regardless--it's a tradition I started after our father died--but I'm going to set aside some money to go the Saints game nonetheless.

I'd direct you over to my Cowboys blog, but I hardly write anything over there except parodies of Beatles songs about Jerry Jones. And I know how much you hate the Beatles. Last year work got ahead of me--lots of foreclosures--and I couldn't devote the time to it as I had intended. But my co-conspirator, the Emperor, and I are going to meet up in Austin at the beginning of April to, as he says, "plan the Revolution" for next season.

Anyway, I saw this guy on the Kaiser report this morning. He's written a book and has a website devoted to the economic elite destroying the middle class.


Lots of interesting stuff over there.

watchtower said...

First off let me say that I'm not a 'Huff' fan but after seeing this over there:

Janitor Facing Eviction Cleans Up After CEO Whose Bank Bought Her House

"At first, Minneapolis janitor Rosalina Gomez said she didn't realize she was cleaning up after the CEO of the bank that bought her foreclosed home in a September sheriff's sale..."


I thought about a quote from Thomas Jefferson:

“If the American people ever allow private banks to control the issue of our currency, first by inflation, then by deflation, the banks and the corporations that will grow up will deprive the people of all property until their children wake up homeless on the continent their fathers conquered.”

I realize that people didn't have to go out and buy a house that they couldn't afford to begin with, but it still sucks that things have went the way it has.

getyourselfconnected said...

you may care if Peppers lands in Philadelphia, HA!

yeah, that Jefferson was sharp.