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The Black Hole On The West Coast
2007-11-29 05:39:00
California Association of Realtors (CAR) came out with the most recent sales numbers for the 3Q of 2007 and in case you didn't hear (or notice), sales are off 40% from a year ago. The media might portray a downturn of 5-7% as a big deal, but try 40% from last October. Most developers and public builders (in this market) are scrambling for anyone to qualify, and then they'll see which house they can afford to lose the least on, with the 'one buyer in tow'.LOS ANGELES (Nov. 28) ? Home sales decreased 40.2 percent in October in California compared with the same period a year ago, while the median price of an existing home fell 9.9 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today. ?Financing issues have dogged entry-level buyers since early 2007, but they spilled over into the middle and upper-tier markets in the last few months,? said C.A.R. President William E. Brown. ?The decline in sales at the upper end of the market contributed to a significant decline...
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FDIC's Sheila Bair: Her Response To Me On Loan Modifications [Digg]
2007-11-28 20:49:00
I realize I ranted quite a bit yesterday on loan modifications, and thank goodness I did because the right people were reading. I'm pleased and honored to post a reply to yesterday's blog, from none other than the Chairman of the FDIC, Sheila Bair:
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It's Official: News Corp. wants LinkedIn!!! [Digg]
2007-11-28 15:59:00
Long standing rumors have now been proven true as LinkedIn CEO Dan Nye has publicly announced that Rupert Murdoch's News Corp. has come to him with an offer for LinkedIn. However that is all the information he is willing to reveal, causing a spectacle about how much Nye would sell the social networking site for.
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Computer Glitch Leads To Brawl At Kmart [Digg]
2007-11-27 07:42:00
"It was a nice brawl. It came from inside to outside. If you go up there, you'll see hair, earrings, all pulled out on the ground," Wilson said.
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Computer Glitch Leads To Brawl At Kmart [Digg]
2007-11-27 07:42:00
"It was a nice brawl. It came from inside to outside. If you go up there, you'll see hair, earrings, all pulled out on the ground," Wilson said.
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CEO of Wells Fargo "Housing in Worst Shape Since Great Depression" [Digg]
2007-11-26 04:59:00
Wells Fargo CEO John Stumpf said the current real estate conditions are the worst he has experienced during his 30-year career. He then punctuated his gloomy assessment by harking back to the deepest downturn of the 20th century. "We have not seen a nationwide decline in housing like this since the Great Depression ," he said.
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8 Interesting News Stories
2007-11-23 00:02:00
It's Thanksgiving 2007 and before the rush of the day, I sat down to catch up on some articles that I've archived over the past week. Here is the list of several interesting news articles I've been saving to review and comment on, given the busy last two weeks with clients:Millionarie Household chart - per country (US is 5.5x over #2);SIV Superfund has picked a top flight manager to handle the $75B fund;Gov. Schwarzenegger works with Lenders to Help California Homeowner;NAR releases 3Q housing results - As defaults increase, lenders pull back;Liberty Dollars seized by FBI;Preview for the Top 5 gadgets from CES 2008 - via Popular Mechanics;Fannie Mae and Freddie Mac Crash - charts;Six brilliant marketing campaigns - with videos;
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Fed's Stern: Foreclosures in housing to rise [Digg]
2007-11-19 16:57:00
SINGAPORE (Reuters) - Minneapolis Federal Reserve Bank President Gary Stern said on Monday he expected the U.S. housing market to weaken further because of a large pool of unsold homes. But employment and incomes were still rising, Stern said, and...
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Wall Street Calculus: $74 Billion in Losses, $38 Billion in Bonuses [Digg]
2007-11-19 16:56:00
When Sallie Krawcheck (now head of wealth management at Citigroup) was an equity analyst covering Wall Street at Sanford Bernstein, she remarked, "It's better to be an employee of an investment bank than a shareholder." This year's results certainly bear out her observation.
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Commercial Real Estate Values Fall 2.5%
2007-11-17 20:21:00
For the 3Q of 2007, there was a decrease in the TBI of 2.5%. Since the 3Q of 2003, the TBI (The MIT/CRE CREDL Initiative has developed a Transactions-Based Index (TBI) of Institutional Commercial Property Investment Performance) has been steadily increasing for the past 4 years.The MIT Real Estate Center analysis shows thatthe drop may not only indicate the end of commercial real estate price increases which effectively doubled in the past 4 years, but it also may signal that weakness in the housing market is spilling over into commercial real estate. The last time we saw this large of a price decrease occurred when prices fell 3.9 percent following the terrorist attacks of 9/11, says the MIT center.Commenting on the index for the third quarter of 2007, MIT center director David Geltner said in a statement, "The fall in our index is the first solid, quantitative evidence that the subprime mortgage debacle, which hit the broader capital markets in August, may be spreading to the comm...
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Greenspan `Made a Mess' and U.S. Risks Recession [Digg]
2007-11-16 19:59:00
Joseph Stiglitz, a Nobel-prize winning former World Bank economist, said the U.S. economy risks tumbling into recession because of the subprime crisis and a ``mess'' left by former Federal Reserve Chairman Alan Greenspan . He supported Bush's tax cut in 2001, which is the beginning of these problems.
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They Own Nothing
2007-11-14 13:51:00
Apparently, Judge Christopher A. Boyko of the Eastern Ohio United States District Court, on October 31, 2007 dismissed 14 Deutsche Bank-filed foreclosures. The original article can be viewed here. In the post, it states that the ruling was based on lack of standing for not owning/holding the mortgage loan at the time the lawsuits were filed.[..]The Court's amended General Order No. 2006-16 requires Plaintiff (Deutsche Bank) to submit an affidavit along with the complaint, which identifies Plaintiff as the original mortgage holder, or as an assignee, trustee or successor-interest. Apparently Deutsche bank submitted several affidavits that claim that Deutsche was in fact the owner of the mortgage note, but none of these affidavits mention assignment or trust or successor interest. Thus, the Judge ruled that in every instance, these submissions create a "conflict" and they "do not satisfy" the burden of demonstrating at the time of filing the complaint, that Deutsche Bank was in f...

Eight-Figure Property Hits the Foreclosure Auction Block PICS [Digg]
2007-11-14 07:40:00
It?s rare to see an eight-figure property hit the foreclosure auction block, but it?s happening. In Australia, a 30,000 square-foot waterfront mansion will be for sale at a Dec. 1 receiver?s auction. A photo of the property from the Christie?s brochure Click to enlarge.Located on Hope Island, an affluent gated community in the Gold Coast, [?]
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Eight-Figure Property Hits the Foreclosure Auction Block PICS [Digg]
2007-11-14 07:40:00
It’s rare to see an eight-figure property hit the foreclosure auction block, but it’s happening. In Australia, a 30,000 square-foot waterfront mansion will be for sale at a Dec. 1 receiver’s auction. A photo of the property from the Christie’s brochure Click to enlarge.Located on Hope Island, an affluent gated community in the Gold Coast, […]
More About: Property , Auction , Foreclosure , Digg , Hits

General Growth Properties Announces Plan To Appeal California Verdict [Digg
2007-11-14 06:09:00
General Growth Properties Announces Plan To Appeal California Verdict
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Level 3 Assets Are Surging
2007-11-13 08:39:00
The FASB 157 rule is set to take effect on the brokerage houses, banks and financial institutions, in case you haven't noticed the latest 5 day drop in the Dow, S&P and Nasdaq. In today's Bloomberg article:...Under the rule, Level 1 assets are those for which market prices are readily available. Level 2 holdings are valued based on ``observable inputs,'' or prices of similar assets traded in the market. Assets fall into the Level 3 category when there aren't even any observable inputs, and the firm has to rely on in-house models to calculate potential gains or losses... While those typically fall into the Level 3 category, assets such as leveraged loan commitments shift from one level to another depending on market conditions...The Rule is specific about unobservable inputs (Level 3 category) and their intended use (FAS 157):...The notion of unobservable inputs is intended to allow for situations in which there is little, if any, market activity for the asset or liability a...

PetroChina World?s Largest Company [Digg]
2007-11-13 06:31:00
PetroChina is now the world?s largest company by market capitalization, valued at approximately $1 trillion. The Chinese behemoth easily eclipses its nearest rival, U.S.-based Exxon Mobile, which is valued at around $488 billion.
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Reasons Come First [Digg]
2007-11-11 04:20:00
Imagine your 6 year old daughter playing with a Rubik?s Cube fresh out of the box on her birthday. She notices the six completed, colored sides in perfect visual harmony, whites across from yellows, reds from oranges, blues from greens. She rotates the cube, studies it, and then..
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OFHEO Response Letter to NY AG - Cuomo
2007-11-08 22:08:00
Yesterday's 300+ pt loss in the Dow was partially a response to New York Attorney General 's demand from the OFHEO to investigate Fannie Mae and Freddie Mac and the loans with Washington Mutual..Second, as part of a wider probe of the mortgage industry, the New York Attorney General Andrew Cuomo demanded that Fannie Mae (Charts) and Freddie Mac (Charts, Fortune 500) examine whether mortgages sold to them by Washington Mutual were for homes that had been appraised at an artificially high price.The fear is that Fannie and Freddie might cut back on purchases and guarantees of loans from WaMu (Charts, Fortune 500). That would be a crippling blow for the bank, because the market for loans that Fannie and Freddie buy is the only part of the mortgage market that has substantial volume.Today, I received the email link for the response letter from James Lockhart with the OFHEO:...OFHEO shares your concerns about fraudelent appraisals and their impact on the mortgage markets and homeownershi...
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Video: Iraqi IED explosion from 9/2/07
2007-11-08 03:47:00
I'm watching the market recap today (listening to GM's woes, the credit crunch and the Chinese deciding not to purchase anymore greenbacks) and was sent this email from my attorney - if anyone is offended, I'll be glad to provide his name and number - :-)If we ever need a reminder of how lucky we are that we don't have to worry about this type of reality, here it is.. and don't forget that there are those Americans (albeit teenagers) that are serving this country dealing with this on a daily basis.. they're doing this so we don't have to watch another 747 slam into Lower Manhattan.. enough said..Notice the slow moving truck (on the left) that pulls over while the Humvees come up from the rear, and the truck on the other side of the street that is pulled over with civilians outside of the vehicle..
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FL: Small Tax Break for Commercial Property Owners [Digg]
2007-11-04 18:10:00
This week Florida lawmakers agreed upon a revision to our current tax structure, while it makes most of the provisions for homesteaded properties and focuses on ?Portability? of the exemptions for these properties, the commercial market got a small bit of good news.
More About: Commercial , Property , Break , Digg , Small

What The Fed Didn't Tell You?
2007-11-02 19:41:00
As expected the Fed cut rates by 1/4 of 1%, or 25 basis points, but behind the headlines, the WSJ reported that the Fed pumped in more money into the financial system since the "credit crisis" took hold in August. This injection suggests that lending institutions are still wary to lend as the short-term debt markets are still sluggish (mortgage apps may be up in the past few weeks, but funding sources have dried up, even in commercial where Greenstreet Commercial (8th largest commercial lender) closed operations this past week).NEW YORK -- The Federal Reserve pumped a total $41 billion to the U.S. financial system in three separate operations Thursday, amounting to the largest injection of funds since the liquidity crisis took hold this summer. The size of the injection may come as a surprise, coming just a day after the central bank delivered its second consecutive rate cut. Wednesday's 25 basis point cut -- which brings the target rate to 4.5% -- follows a half percentage-point d...
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CCIM Call to Action
2007-11-01 18:25:00
I posted the newest Call to Action from the Legislative Liaison for the CCIM on the BHB site. It looks like Dem's are trying to raise taxes on Real Estate Partnerships from 15% to 35%, which would have an immediate impact on commercial real estate.
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Homeless Millionaire [Digg]
2007-10-30 06:25:00
A homeless man living on the streets in Phoenix, Arizona surprised a lot of people after he died. And now he's become the city's best example that you can't judge...
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Homeless Millionaire [Digg]
2007-10-30 06:25:00
A homeless man living on the streets in Phoenix, Arizona surprised a lot of people after he died. And now he's become the city's best example that you can't judge...
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Housing Is Taking Down Department Stores
2007-10-29 05:35:00
I posted an article in September regarding Commercial CAP rates were (or would be) on the rise as a result of the slow down in the housing market and ensuing "credit crunch". The New York Times has an article yesterday showing the effects of the home builder problems and the correlation with the decline in department store value, which translates to slower consumer spending.Since April, when investors voiced optimism that the housing slide had been contained, shares of the country?s biggest department store chains have fallen by about 30 percent.With the sagging prices, investors have rendered a harsh judgment on the coming holiday shopping season, predicting that consumers will severely cut back on spending.The gloom since April 20 has been spread evenly across the big chains: shares of J. C. Penney are down 33 percent, Macy?s by 27 percent, Kohl?s by 28 percent and Sears by 28 percent.Robert J. Barbera , the chief economist of the Investment Technology Group, said, ?The conventiona...
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Understanding The 2007 Federal Deficit Numbers
2007-10-26 00:44:00
One of the more interesting articles today that made me step-back from all of the "doom and gloom" was from economist, Jeff Thredgold, and his weekly assessment of the economy. What was interesting was the fact that the 2007 federal budget deficit, ending September 30th, was $163 billion. So what? Well.. That number represents 1.2% of the GDP for the US, which is HALF the average deficit for the past 40 years. Jeff argues that the tax cuts have increased revenues (a point of contention for any Dem vs. Rep) into the Federal Gov't and significantly decreasing our budget deficit relative to the GDP:Progress continues to be made in reducing the U.S. government?s income versus spending imbalance, commonly known as the annual budget deficit. Additional progress from this point, however, may be more difficult to come by. The federal budget deficit for fiscal year 2007, which ended on September 30, registered $163 billion. The number resulted from g...
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Blogs Are Attracting VC Money [Digg]
2007-10-24 01:01:00
More quickly than most anyone imagined, blogging is growing up. From the blogosphere's anarchistic roots, a professional cadre is emerging that is creating an industry whose top-performing businesses now earn serious money. The industry is expanding at warp speed.
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Important Reminder for Mobile Professionals
2007-10-23 19:54:00
I received this video from a family member in Florida. I thought it was a good idea to post as a reminder to mobile professionals (male and female) to protect you're personal identity when we're on the go and filling up at the gas station (albeit @ $3.10/gal).
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CDO's Shutting Off Cash Payments to Investors
2007-10-22 21:25:00
Some housing news from the New York Times that I thought was interesting given that the markets have rallied today: ?For all the pain in the mortgage market, investors who hold bonds backed by risky home loans have continued to receive their monthly interest payments ? until now. Collateralized debt obligations ? made up of bonds backed by thousands of subprime home loans ? are starting to shut off cash payments to investors in lower-rated bonds as credit-rating agencies downgrade the securities they own, according to analysts and industry executives.? ??At this point, it?s fair to say that everybody expects this shoe will drop,? said Mark Adelson, an independent mortgage securities consultant and analyst. ?It?s a foregone conclusion. But when it happens, there will be a market reaction to it.?? ?Investment banks issued some $486 billion in debt obligations linked to mortgages in 2006 and the first half of 2007. In the last two weeks, leading investment banks have written down about...
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