I wonder why nobody has gone to jail. I wonder why there have been no trials. I wonder why there have not been any charges filed. What happened?
Was it not obvious to everyone that banks colluded with rating agencies to create trillions of dollars worth of nearly worthless derivatives based upon mortgages that they new would default. Again I ask , why have there been no trials, no charges or even any significant changes in the system.
To their credit , or shame , congress did act in 2009. They destroyed the appraisal industry and put it in the hands of the very banks they were trying to protect us from. As a result , the appraisal you receive now is very likely from the lowest bidder who is also the least experienced appraiser that could be found. The process now takes twice as long and costs the consumer more money than before. Thanks for nothing.
Meanwhile , rating agencies who magically turned coal into gold with the help and guidance of major investment banks are still doing business the same exact way they were prior to the crash. Bonds and derivatives are sent to these agencies for a rating and the bank that created the bond or derivative pays for the rating. Is there really any wonder to what happened. Is there any doubt that it will absolutely happen again because there is money to be made at the expanse of us all.
It is pretty clear who holds the power in this country, those with all the money make all the rules. They can defraud the entire world out of trillions of dollars without repercussion or consequences , they can get us to give them money to stay in business and keep congress from changing any of the rules that caused the crisis. Meanwhile , they vote themselves multi-million dollar bonuses because they are so smart.
This is America where fair play and justice prevail, so I still wonder-- why has nobody gone to jail?
Saturday, February 12, 2011
Friday, February 11, 2011
Newest statistics show a decline in foreclosures
According to Realytrac , default notices, auctions and repossessions are down by 17 percent from a year ago. This should be good news, right?
Not so fast, this decline is mostly a result of the robo-signing scandals that were at the top of the news recently. As a result , states that use the court system to repossess homes are backed up because they are actually reviewing the paperwork. The lower numbers are simply a result of fewer homes being pushed through the system. The numbers for foreclosure notices are still very high and are showing no inclanation to even stabilize. With more and more people underwater and more in danger of either be foreclosed upon or just walking away from their homes , the supply of new homes ripe for foreclosure will not decline for many months to come.
Has anyone noticed that interest rates for home finance have been rising over the last month or two? What news has come out that would make interest rates rise. I think the answer is that no news has come out and banks have simply decided that they are not making enough money in the current market.
At the current time , bank are receiving basically free money from the government to turn around and loan out at approximately 4 percent. This is a historically low spread for the banks and since they have been forced to service what they loan out they do not feel comfortable with such a small spread on their money.
As a result , the re-finance market has taken a sharp decline in the last couple of months which is going to hurt real estate even more.
Get ready for a long ride.
Not so fast, this decline is mostly a result of the robo-signing scandals that were at the top of the news recently. As a result , states that use the court system to repossess homes are backed up because they are actually reviewing the paperwork. The lower numbers are simply a result of fewer homes being pushed through the system. The numbers for foreclosure notices are still very high and are showing no inclanation to even stabilize. With more and more people underwater and more in danger of either be foreclosed upon or just walking away from their homes , the supply of new homes ripe for foreclosure will not decline for many months to come.
Has anyone noticed that interest rates for home finance have been rising over the last month or two? What news has come out that would make interest rates rise. I think the answer is that no news has come out and banks have simply decided that they are not making enough money in the current market.
At the current time , bank are receiving basically free money from the government to turn around and loan out at approximately 4 percent. This is a historically low spread for the banks and since they have been forced to service what they loan out they do not feel comfortable with such a small spread on their money.
As a result , the re-finance market has taken a sharp decline in the last couple of months which is going to hurt real estate even more.
Get ready for a long ride.
Thursday, February 10, 2011
New Real Estate statistics bode ill for us all
I recently read a Seattle Times article by Eric Pryne which did not do anything to help my mood about the real estate business or the economy as a whole. In the article, statistics from zillow.com showed that the number of homeowners who are currently underwater on their mortgages has risen from 23 percent to 33 percent over the last year. this is really bad news for anyone who owns a home or condo. In the seattle area it means that everyone who owns a home or condo lost approximately $35,000 from their net worth and for 33 percent of homeowners , they owe more on their homes than they are worth on the open market.
When you listen to news channels or business channels on t.v , they usually have interviews with "experts " who claim that we have seen the worst and the economy is in full recovery mode. I, for one, do not believe it. Real estate values are still dropping all over the country, the number of foreclosed homes is expected to rise in 2011, banks are not loaning money on homes to even qualified applicants, bank owned and short sale homes are having dramatic effects on the value of homes both here in the pacific northwest and around the country. In some cases that I have encountered , bank owned and short sale homes are the market. If you want to sell your home in such a market you would have to compete with these bank owned and short sales homes yourself in order to sell your home.
Most of these "experts" point to the stock market which has been rising dramatically for the last 2 years as a sign that the economy is on the mend and recovering. Nothing could be further from the truth. These companies laid of anywhere from 10 percent to 50 percent of their employees about 2 years ago and they have not hired them back. These companies found that they can make more net income with lower revenues and less people working for the company and they are not about to change what is working for them. Therefore, these companies are creating value for their shareholders but they are not helping the economy, it could be argued that they are hurting the economy by not creating jobs with all the money they are sitting on.
The bottom line is that the Real Estate market is still in decline and until real estate stabilizes such that it finally quits losing value every year, we are in for a tough ride for a long time to come.
It should be noted that the author does not endorse zillow in any way, shape or form but the above statistics are very interesting no matter where they came from.
When you listen to news channels or business channels on t.v , they usually have interviews with "experts " who claim that we have seen the worst and the economy is in full recovery mode. I, for one, do not believe it. Real estate values are still dropping all over the country, the number of foreclosed homes is expected to rise in 2011, banks are not loaning money on homes to even qualified applicants, bank owned and short sale homes are having dramatic effects on the value of homes both here in the pacific northwest and around the country. In some cases that I have encountered , bank owned and short sale homes are the market. If you want to sell your home in such a market you would have to compete with these bank owned and short sales homes yourself in order to sell your home.
Most of these "experts" point to the stock market which has been rising dramatically for the last 2 years as a sign that the economy is on the mend and recovering. Nothing could be further from the truth. These companies laid of anywhere from 10 percent to 50 percent of their employees about 2 years ago and they have not hired them back. These companies found that they can make more net income with lower revenues and less people working for the company and they are not about to change what is working for them. Therefore, these companies are creating value for their shareholders but they are not helping the economy, it could be argued that they are hurting the economy by not creating jobs with all the money they are sitting on.
The bottom line is that the Real Estate market is still in decline and until real estate stabilizes such that it finally quits losing value every year, we are in for a tough ride for a long time to come.
It should be noted that the author does not endorse zillow in any way, shape or form but the above statistics are very interesting no matter where they came from.
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