Foreclosures Rise 9% in 1H 2009
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Foreclosures continue to rise. As CNN/Money wrote, “The foreclosure plague is not going away — it’s only getting worse.”
Here is the data on the first half of 2009, via RealtyTrac:
“Midyear 2009 U.S. Foreclosure Market Report, which shows a total of 1,905,723 foreclosure filings — default notices, auction sale notices and bank repossessions — were reported on 1,528,364 U.S. properties in the first six months of 2009, a 9 percent increase in total properties from the previous six months and a nearly 15 percent increase in total properties from the first six months of 2008. The report also shows that 1.19 percent of all U.S. housing units (one in 84) received at least one foreclosure filing in the first half of the year.”
No real estate bottom in sight . . .
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Source:
1.9 MILLION FORECLOSURE FILINGS REPORTED ON MORE THAN 1.5 MILLION U.S. PROPERTIES IN FIRST HALF OF 2009
RealtyTrac
http://www.realtytrac.com/ContentManagement/PressRelease.aspx?channelid=9&ItemID=6802
http://www.foreclosurepulse.com/blogs/mainblog/archive/2009/07/15/foreclosure-filings-in-the-millions-midway-through-2009.aspx
July 16th, 2009 at 7:43 am
Well, I am proud of Tennessee. For a while we were more or less a pastel pink, certainly nothing a Vol fan could be proud of. I am happy to see that we are using the red Crayola much better now. To think, that Michigan and Ohio and Georgia were Alabama Crimson, and we had to catch up. Now just wait for a ballgame!
…Texas…looking mighty anemic still…
July 16th, 2009 at 7:50 am
This was in my paper this morning:
Economist Sheryl King said the latest Bank of Canada report suggests the economy could bounce back with several quarters of 10 per cent growth in the next year in a report tilted “Are markets ready for 10 per cent GDP?” The answer to her question is a solid “no.”
I’m just wondering what would happen to bonds if this actually happened!!!
July 16th, 2009 at 8:08 am
ZH’s take-
“Look elsewhere for green shoots… and CNBC’s favorite commodity – hope. 1.9 Million foreclosure filings in the first half, 889,829 in the second quarter, with 336,173 in June alone, bringing the second quarter total to the highest number since RealtyTrac has been following these data. And this all is happening while various foreclosure moratoria and other national and state mitigation efforts are still in play.One can just imagine the bottom really falling out of the market once California and others stop pretending they can control this accelerating train wreck.”
July 16th, 2009 at 8:55 am
call me ahab Says:
July 16th, 2009 at 8:08 am
“Look elsewhere for green shoots… and CNBC’s favorite commodity – hope.
comment:
—————–
I’m feeling a little surly this morning.
Hey, Franklin411. Come out of hiding.
You’ve been singing the praises of green shoots for many months now. Some of those shoots should have grown into bigassed slap in the face wonderments of economic activity by now. Name a few that clearly show some genuine improvement. Not the promise of improvement. Not the whiff of improvement on the run. Trace a few from start to finish and come up with some real improvements that benefit real people. Where the fuck are they? Employment? Housing? Retail Sales that don’t involve higher gas prices? Real Estate? CIT finance company? Anything? Don’t tell me about more green shoots. I want you to tell me where massive steaming piles of green shit are located.
July 16th, 2009 at 9:00 am
Unadjusted initial claims:
667k.
Automobile summer layoffs that are distorted this year are skewing the figures….
Hmmmmm……
July 16th, 2009 at 9:11 am
Layoff Franklin will ya?
I figure…got an IOU instead of a paycheck…or….got a pink slip for graduate assistant teaching slot…or…fewer students for fall classes and fewer GA’s needed to teach introductory courses…or…
July 16th, 2009 at 9:18 am
Bruce in Tn Says:
July 16th, 2009 at 9:11 am
Layoff Franklin will ya?
reply:
————-
I forgot he’s wrapped up with California’s flavor of green shoots right now. Maybe he’ll get 100% comp time out of it (They’ll give him one day off for each day he teaches for free.)
July 16th, 2009 at 9:21 am
I’m feeling pretty surly today, too DH. Just keep in mind that the housing market is still cratering, even in the face of massive, and I mean massive amounts of newly-minted greenbacks (or their corollary, pixels on a computer screen) that represent nothing but a claim on future income, being thrown at it.
$1.5 Trillion or so, roughly double what the Mortgage Bankers expect will be entire the residential real estate market this year. And still it craters. What happens when they have to shut down the presses?
And here’s the irony: As soon as it appears all this stimulating is having an effect, the price of money goes up, pushing interest rates up, causing more pain in the housing market and the economy, in turn wilting the green shoots, causing the price of money to go down, rinse and repeat, ad infinitum.
My favorite heretic Jew philosopher, Baruch Spinoza, said that under a monarchy, the state would own all the land. We’re heading there fast.
July 16th, 2009 at 9:24 am
The foreclosure map; the unemployment map…? Does anyone else notice the similarity to the political Blue State (Democratic Party); Red State (Republican Party) map from the 2000, 2004, 2008 election? Probably a complex link but it’s there–higher foreclosures, higher unemployment, votes Democrat.
July 16th, 2009 at 9:25 am
Another Green Chute:
July 16 (Bloomberg) — MGIC Investment Corp., the largest U.S. mortgage insurer, will inject as much as $1 billion into an inactive subsidiary, allowing the company to continue to sell new coverage after eight straight unprofitable quarters.
The subsidiary may take over the sale of policies as of Jan. 1 if it gains approval from state insurance regulators by then, Milwaukee-based MGIC said today in a statement. The insurer also announced its eighth straight unprofitable quarter, posting a $339.8 million loss as the worst housing slump since the Great Depression caused more defaults.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aj7YPjtax_Q8
July 16th, 2009 at 9:26 am
OT: (on tangent)
How do y’all feel about the promise of 3-D Movies, tickets at an upcharge, of course– for the glasses–in the wake of this Economic environment?
July 16th, 2009 at 9:28 am
The Curmudgeon Says:
July 16th, 2009 at 9:25 am
Another Green Chute:
July 16 (Bloomberg) — MGIC Investment Corp., the largest U.S. mortgage insurer, will inject as much as $1 billion into an inactive subsidiary, allowing the company to continue to sell new coverage after eight straight unprofitable quarters.
reply:
————
You could be right. They appear to have invented perpetual motion.
July 16th, 2009 at 9:30 am
efrltd Says:
July 16th, 2009 at 9:24 am
The foreclosure map; the unemployment map…? Does anyone else notice the similarity to the political Blue State (Democratic Party); Red State (Republican Party) map from the 2000, 2004, 2008 election? Probably a complex link but it’s there–higher foreclosures, higher unemployment, votes Democrat.
reply:
————
You may be jumping to a conclusion. Trailers are, technically, repossessed.
July 16th, 2009 at 9:36 am
I like it Hobo…could not keep from grinning..
July 16th, 2009 at 9:37 am
Duck, duck we are being machine-gunned with green shots
(got to get that spel-check fixed)
July 16th, 2009 at 9:39 am
found these
http://econompicdata.blogspot.com/2009/07/total-capacity-in-economy-shrinking.html
http://tbm.thebigmoney.com/articles/judgments/2009/07/14/economics-narcissism
http://www.businessweek.com/magazine/content/09_30/b4140022152923.htm?campaign_id=rss_topStories
July 16th, 2009 at 9:41 am
http://finance.yahoo.com/news/Jobless-claims-drop-but-apf-3440402076.html?x=0&sec=topStories&pos=6&asset=&ccode=
New jobless claims drop to 522,000, but mostly due to problems adjusting for auto shutdowns
“A department analyst said the drop in new claims didn’t point to improvements in economic conditions. The second straight weekly decline reflected problems adjusting layoffs for temporary shutdowns at General Motors and Chrysler plants to retool for new models.
The unadjusted figures actually showed that new claims rose by 86,389 last week, which would push the total to 667,534.
Ohio reported one of the largest increases in new claims, up by 4,240 because of layoffs in both manufacturing and services.”
One problem living in a Socialist paradise…sometimes inconvenient little things like reality get in the way of our self-induced bliss….
July 16th, 2009 at 9:44 am
and there is this
http://www.bloomberg.com/apps/news?pid=20601109&sid=aJ19uuXkCD9c
July 16th, 2009 at 9:44 am
Relax, Hobo. I’m leaving for the East Coast today, including an overnight stay in Manhattan. My plans are 1. To do a scientific comparison of Gray’s Papaya vs Nathan’s Famous Hot Dog stand, and 2. To tour the ruins of a once great civilization called Wall Street.
As to green shoots, how about this:
The LA Times and the San Diego Union-Tribune recently reported that local housing prices have begun to climb. Foreclosure inventories have been worked through, and many local economists think the market here bottomed in June:
Southern California median home sales price surges in June
Southern California home prices may have finally hit bottom, with median values rising last month for the first significant increase in two years, new data show.
Along with the 6.4% rise in prices from May, fewer than half of the sales were foreclosures — the first time that has happened in nine months.
“I think we can now say with fair degree of confidence the pace of real home price declines has slowed dramatically,” said Los Angeles economist Christopher Thornberg, who was an early predictor of the housing bubble.
http://www.latimes.com/business/la-fi-home-sales16-2009jul16,0,6992810.story
http://www3.signonsandiego.com/stories/2009/jul/15/bn15prices1263/
July 16th, 2009 at 9:52 am
franklin411 Says:
July 16th, 2009 at 9:44 am
“I think we can now say with fair degree of confidence the pace of real home price declines has slowed dramatically,” said Los Angeles economist Christopher Thornberg, who was an early predictor of the housing bubble.
reply:
———–
Things getting bad at a slower rate = things getting worse, not better. Try again.
July 16th, 2009 at 9:57 am
F411: You are missing the fact that the rise in SoCal home prices in May is due to the fact that the housing collapse is moving up the ladder to the more expensive homes, as higher end homeowners come under financial duress. Green chutes, baby !!
July 16th, 2009 at 10:03 am
I bet Barry will post on this later, but what the heck is up with the 640k drop-off in continuing claims? With benefits extended to 75 weeks, what is up with that? These UI models are so sketchy.
July 16th, 2009 at 10:10 am
Gee let’s see how US economy is looking into 2011 …
CRE getting crushed
RRE still tanking
Consumer spending going down
Wages deflating
Unemployment continues to grow with U6 likely at 20% across USA
Underemployment is growing faster than unemployment
Way too much MSM and Obamanomics happy talk about more green shooties;)
July 16th, 2009 at 10:17 am
@Transor: The Unemployment numbers are a bit funky in the summer. Companies typically don’t lay off in the midsummer months as the HR peep are all at the beach, lake etc..
If you want to feel happier, think of lifeguards, summer interns, Dairy Queen stands …. and buy some Treasuries.
Better still watch Gary Shilling’s video and then buy some Treasuries.
July 16th, 2009 at 10:27 am
LB
Yep, that rise in median sales price head fake has been identified and warned about for months by the likes of CR and Dr. Housing Bubble. But the unquestioning, lack-of-critical-thinking is falling for it just as expected. And then the top end will finally start crumbling, weighing the bottom end down even more in the process, and finally dragging down median prices yet againg, and that bunch won’t know what hit them.
July 16th, 2009 at 10:30 am
Well, there were 675k new claims, before the numbers were massaged. Period.
Can we just be friends whether or not we are working? Franklin is going to New York…would anybody like a good NY deli/pastrami?
July 16th, 2009 at 10:33 am
http://finance.yahoo.com/news/Jobless-claims-drop-but-apf-3440402076.html?x=0&sec=topStories&pos=6&asset=&ccode=
“The unadjusted figures for last week actually showed that new claims rose by 86,389 last week, which would push the total to 667,534.
The department’s seasonal adjustment process expected a large increase in claims from auto workers and some other manufacturers, the analyst said. Since that didn’t happen, seasonally-adjusted claims fell.”
Simply the new math…1 and 1+seasonal variations= Paradise
July 16th, 2009 at 10:34 am
@Onlooker: Exactly. Now that CIT is belly up, there is no more funding for Donny and Debbie Donut Franchisee, which means they can’t roll over their debt and they will have to declare BK and F/C on their $1M McMansion.
Of course they can sell it to a summer intern at GS who can use his bonus as a down payment. Meanwhile their 13 workers are all out of a job, and it won’t be long before they F/C on their “extended” Capes. It’s all connected.
It’s not a pretty picture out there in the real world, Franky.
July 16th, 2009 at 10:34 am
Oil will see a new high today. Holding my longs for a ride.
July 16th, 2009 at 10:35 am
@lb: You are indeed correct about slowing layoffs in the summer. Everything slows down in the summer, due to vacations, including layoffs. I expect them to resume full throttle come Sept. Most people I know are still very worried about losing their jobs.
July 16th, 2009 at 10:39 am
Transor Z
Continuing claims only include the normal UE limit of 26 weeks. So those on extended benefits aren’t captured in that stat. Thus making it a decreasingly useful stat as this rolls on.
July 16th, 2009 at 10:40 am
efrltd,
Its not that complex. Staunchly dem states tend to be the bubble states. The states that have voted 60% dem leading up to the bubble popping have been the epicenters of financial fraud and greed. The lovely duo of New York and Cali. But its the reps fault!
hobo,
With houses so easy to get we had almost no one living in trailers. They’re moving into them now though!
July 16th, 2009 at 10:43 am
Manny, a certain corporation located in Fraudfield, Con Etiquette is likely to have more layoffs in September.
July 16th, 2009 at 10:48 am
I know you all know this already but re: job losses in the summer, there is that other thing going on that doesn’t show up in the claims number which are things like the voluntary/mandatory 10 days off without pay this summer for all DD employees in Delaware.
Hours are being cut as is overtime. That doesn’t equal unemployment, but it certainly crimps spending, not to mention impacts social mood.
As an aside, anyone in on the MOS trade? I know a lot of people here were using that stock earlier in the year. Big bounce today. I missed it.
July 16th, 2009 at 10:49 am
Most people I know are still very worried about losing their jobs.
I can tell you that the 42 clients I have left working at BAC are. They are all scared, even the one’s working on the ML transition team, what will they do when it’s done?
July 16th, 2009 at 10:49 am
Hey Ben,
Howsit that Rhode Island has such ungodly unemployment numbers compared with the rest of the New England region?
Just wondering…
July 16th, 2009 at 10:50 am
@lb: Not surprising. From what I can gather, many companies are in wait and see mode and will cut more in the fall if the outlook doesn’t improve. The snowball is rolling down the hill and getting bigger, albeit at a slower pace.
July 16th, 2009 at 10:52 am
@ben22: I made some dough off of MOS earlier this year but haven’t gotten back in. Wish I had now. Was there any news or is it just popping on nothing like many stocks nowadays?
July 16th, 2009 at 10:53 am
@ben22: I answered my own question on MOS. Takeover rumors, I see.
July 16th, 2009 at 10:58 am
Bruce,
No clue on my end on that one. I can tell you a lot about PA, DE and NJ but Rhode Island I’m not so familiar with. Maybe less jobs in Boston for people living there is one guess. Maybe lefty knows, he’s closer.
Glancing at this list might explain some of it, BAC is one of the top employers there, perhaps there was a lot of job overlap with offices there after they got Countrywide and ML so there could have been some serious layoffs as a result. Couple that with such a small state and even if the numbers weren’t huge relative to other states it gives you a high unemployment rate. Citizens is also up there as are GD and RTN which I know have both had pretty sizeable layoffs.
http://www.dlt.ri.gov/lmi/es202/largestemp.htm
July 16th, 2009 at 11:00 am
@manny,
I remember you having MOS, yeah, it’s takeover news pushing that up today. Stock has had an awesome year so far, up over 44%. Won’t want to be holding stuff like this going into the late stages of Q3 though.
July 16th, 2009 at 11:02 am
Manny
Re: MOS
There are rumors about a $25 billion all cash offer for Mosaic, from the Brazilian company VALE. But who knows really, with this bipolar market it doesn’t take much to swing back and forth, especially with this stock.
July 16th, 2009 at 11:02 am
FXP trade in the money early today by about 1k despite the BTE China GDP number. A peak under the hood of that last night gives the same conclusion as all these earnings “beats”, I think a storm is brewing in China.
July 16th, 2009 at 11:04 am
Onlooker,
No doubt, if I was in MOS I’d sell or at least take all my profits off. I always think back to the Dow Chemical deal last year that blew up on them, I would think a lof of CEO’s have to be a little gun shy about making big deals in such an uncertain environment.
July 16th, 2009 at 11:10 am
@ben:
It’s unclear. RI lost jobs across all sectors, even healthcare:
http://www.projo.com/news/content/RI_JOBLESS_RATE_19_06-19-09_P3EP6LA_v17.3e95f94.html
http://www.npr.org/templates/story/story.php?storyId=101389487&ft=1&f=1006
I don’t think it’s Boston. Massachusetts is doing better than most states — including state budget issues. And Boston is all about healthcare and education, which has also helped. Although there are some knock-down drag-0ut state budget fights going on, MA legislated a rainy day fund a few years ago so we’ve had a cushion.
Bear in mind that the RI unemployment rate was already over 8% in August 2008.
There’s some speculation that the RI corporate tax rate factors in,
July 16th, 2009 at 11:10 am
Speaking of foreclosures…
http://www.businessweek.com/magazine/content/09_30/b4140022152923.htm
The Time Bomb in Corporate Debt
“No surprise here: As the recession grinds on, more companies are falling behind on their debt payments. The default rate tops 11%, up from 2.4% last year—and could peak at 12.8% by the end of the year, the highest ever, according to credit rating agency Moody’s Investors Service (MCO). But what’s worrying economists more is that the rate could remain stubbornly high for quite a while. “Be prepared for a multi-year period of high defaults,” says Louise Purtle, a senior analyst at CreditSights. “We’re going to see peaks like a mountain range.”
July 16th, 2009 at 11:13 am
@Bruce: I may be wrong, and no offense to Rhode Islanders (it’s a very nice state), but I think it’s always lagged behind the Boston and NYC metro areas business-wise largely because it competes for business with those two places and often loses out (much like Hartford and New Haven). Most businesses seem to prefer to be clustered in/around/near NYC and Boston, so in that regard Rhody tends to be the red-headed step-child of New England.
July 16th, 2009 at 11:15 am
Transor,
thanks for the links. Like I said, not really familiar with RI, just a few guesses without really looking into it. I would imagine in an environment like this that corp taxes would play a role.
Speaking of debt payments, I’m sure a lot of people don’t follow things like HY Bond mutual funds but they are, for the most part, up huge this year. I’d be worried if I were there, it seems certain that a wave of defaluts will hit junk bonds in the coming quarters.
One other note, on my favorite subject, Dimon said today they probably won’t make money on credit cards in 2010. Credit deflation folks.
July 16th, 2009 at 11:25 am
AMERICAS PETROGAS INC BOE.v
This one might be an unusual way to play the current game in the phosphate area. If you go the company’s website there is a presentation that has information on its project in Bayovar, Piura, Peru. If you look at the plats of their concessions you will see CVRD in adjacent lots- that’s Vale. Eventually, it will make strategic sense for CVRD to acquire that operation from Americas Petrogas (it is a likely proposition that API obtained the very best concession in that area). Bayovar-Paita-Pacific Rim (asian agricultural demand).
July 16th, 2009 at 11:25 am
RealtyTrac is really a questionable data source:
http://www.erictyson.com/articles/20090104
Also, the headline here is misleading – foreclosures were not up 9 percent…the total number of filings they counted (which includes multiple filings on many properties) was up 9 percent but as detailed in my article, they’ve got data problems.
July 16th, 2009 at 11:28 am
MRegan,
That’s pretty interesting, thank you. Late last year when I really thought we would have inflation, before flipping to the dark side, I was in love with everything ag. I owned a lot of DBA but sold it all at $28.
July 16th, 2009 at 11:32 am
Providence actually did an amazing job reinventing itself over the last 20 years or so. Businesses like the financials already mentioned and major insurers like AMICA have had major presences there. CVS Caremark also has its corp HQ in RI. So they have some good things going for them.
Newport is a huge tourism draw. I’m not sure how the relatively new casinos in Lincoln are doing, but I’m sure they get trounced by Foxwoods and Mohegan Sun in CT.
Also, I streamed some of the Paulson hearing. He’s a pretty tough SOB. The issued have narrowed to this:
1. Paulson admits to strong-arming Lewis
2. Paulson claims invoking the MAC clause would have been a “colossal error in judgment” on the part of Lewis and the BAC board, justifying removal — and therefore justifying reminding Lewis in a heavy-handed manner of the scope of the “Fed’s regulatory authority.” He bases his assessment in the legal opinions of Treasury attorneys that there was no legal basis for invoking the MAC clause and on projected catastrophic results to both BAC and ML in the event of delay caused by putting the merger to another vote.
3. Conspicuously missing from the record is any expression of awareness/concern on Paulson’s part of possible securities fraud by Lewis and the board for failing to do due diligence in the ML merger and/or failing to disclose. Paulson ain’t saying much on this point.
July 16th, 2009 at 11:34 am
Shoot! I posted another response to you Ben but unthinkingly used the word c*sino in reference to RI’s new “wagering facilities” in Lincoln.
July 16th, 2009 at 11:35 am
Providence actually did an amazing job reinventing itself over the last 20 years or so. Businesses like the financials already mentioned and major insurers like AMICA have had major presences there. CVS Caremark also has its corp HQ in RI. So they have some good things going for them.
Newport is a huge tourism draw. I’m not sure how the relatively new c*sin*s in Lincoln are doing, but I’m sure they get trounced by F*xwoods and M*hegan Sun in CT.
Also, I streamed some of the Paulson hearing. He’s a pretty tough SOB. The issued have narrowed to this:
1. Paulson admits to strong-arming Lewis
2. Paulson claims invoking the MAC clause would have been a “colossal error in judgment” on the part of Lewis and the BAC board, justifying removal — and therefore justifying reminding Lewis in a heavy-handed manner of the scope of the “Fed’s regulatory authority.” He bases his assessment in the legal opinions of Treasury attorneys that there was no legal basis for invoking the MAC clause and on projected catastrophic results to both BAC and ML in the event of delay caused by putting the merger to another vote.
3. Conspicuously missing from the record is any expression of awareness/concern on Paulson’s part of possible securities fraud by Lewis and the board for failing to do due diligence in the ML merger and/or failing to disclose. Paulson ain’t saying much on this point.
July 16th, 2009 at 11:41 am
ben22,
don’t be so quick to write-off Phosphate–>Ag production to the ‘Inflation Trade’-Thesis..
while that Thesis has, certainly, pumped a lot of Air into various positions, at the EOD, peeps like to eat..
July 16th, 2009 at 11:41 am
ben22
re: HY junk bonds
From this article willid linked to above: http://www.bloomberg.com/apps/news?pid=20601109&sid=aJ19uuXkCD9c
“I just don’t see the proper risk reward here,” he said on a conference call for clients July 7. “The bet that you’re making in high yield right now is that the consensus forecast for defaults is actually going to come in lower than anticipated.”
July 16th, 2009 at 11:49 am
I’d say the hardest hit areas are a reflection of population, not politics. If we want to look at the role of politics, the policy/political analysis we’ve already gone over here – ad infinitum – would be a better place to start. I’m not surprised that we’re still axle deep in the swamp, and I don’t know that we’ll get the car (the economy) out. I know who was driving when the wheels left the road. The only question left is when we capitulate and give the car up as a total loss and start walking.
July 16th, 2009 at 11:49 am
I’d say the hardest hit areas are a reflection of population, not politics. If we want to look at the role of politics, the policy/political analysis we’ve already gone over here – ad infinitum – would be a better place to start. I’m not surprised that we’re still axle deep in the swamp, and I don’t know that we’ll get the car (the economy) out. I know who was driving when the wheels left the road. The only question left is when we capitulate and give the car up as a total loss and start walking.
July 16th, 2009 at 11:59 am
efrltd and the tan – um . . . how are you accounting for Arizona, Nevada, and Florida in your red state/ blue state argument?
July 16th, 2009 at 12:01 pm
@MEH,
point taken, Jim Rogers agrees that’s for sure.
@Onlooker,
Re: HY Bonds,
That’s sort of my point above, if you were in, take your gains, or you are more of an asset allocator and you are still trying to do buy and hold, I’d reduce my position way down in HY bonds at this point. You’ve got mostly everything going against your ability to continue to make good returns moving forward in that space imo.
July 16th, 2009 at 12:09 pm
@Thor efrltd tan
I think I’m with Thor on this…I can’t see the use into spinning the foreclosure issue into a red state/blue state argument…
July 16th, 2009 at 12:11 pm
Funny… this conversation stream.
Guess what I have on my radar for trades I want to open?
Short JNK
Long FXP
Interesting…
July 16th, 2009 at 12:12 pm
LB tinkered with some HY bond funds from January onwards but that ended in May. Still have some IG funds.
Little Rhody had started to become a second home destination and had benefitted from some housing market frothiness. Took a vacation around Newport at the time of the Second Gilded Age and you could tell they were thinking about how much gold leaf to put on the faucets. It’s dead in the water now.
July 16th, 2009 at 12:15 pm
@LB
Rhody lives in it’s own world…
It’s still run by the mob to a large degree…
July 16th, 2009 at 12:16 pm
ben22 -
you’re welcome, of course. WRT inflation as an investment criterion in that sector, I am not smart enough to know. I would note that the current trend is downward in pricing for phosphates/potassium. I think operators like Vale are thinking about long-term demand trends. China has curious problems re logistics and internal supplying of markets. Bottlenecks are a problem, so massive importation of food to balance their caloric demand with local production capacity may be seen as a bad option and they may opt to juice local yields. Fertilizers don’t spoil so to speak. Any way, just random thoughts and way off topic. Sorry for the detour.
Lastly, my humble take on the MOS jump is that it represents a selling opportunity.
July 16th, 2009 at 12:17 pm
True, LB.
But I would still be long Providence, short NYC.
July 16th, 2009 at 12:19 pm
EricTyson,
Excerpt from linked article:
RealtyTrac® (realtytrac.com), the leading online marketplace for foreclosure properties, today released its Midyear 2009 U.S. Foreclosure Market Report, which shows a total of 1,905,723 foreclosure filings — default notices, auction sale notices and bank repossessions — were reported on 1,528,364 U.S. properties in the first six months of 2009, a 9 percent increase in total properties from the previous six months and a nearly 15 percent increase in total properties from the first six months of 2008. The report also shows that 1.19 percent of all U.S. housing units (one in 84) received at least one foreclosure filing in the first half of the year.
—————————————————-
This article appears to make the distinction between properties and filings. How do you get a green shoot out of it?
July 16th, 2009 at 12:24 pm
Off topic…but I need someone smarter than me to answer a question here:
Note: that INSTANTLY qualifies everyone…
Is the dollar going to COMPLETE a 5 wave down (since March) and thereby FINALLY get this whole thing overwith…I’m tired of it dicking around here on support when I could could be off to the beach!
See here’s how it works…Dollar collapses and prints it’s 5 wave down…I can pile into Treasuries with Schilling…and go spend a couple of days at the beach…
Dollar craps around here, and I have to stay close to home and weed my garden, put up fenceposts, mulch, and paint the bathroom…
July 16th, 2009 at 12:25 pm
Hobo – I did NOT say it was a green shoot – have you been drinking again this morning?!
I made reference to the HEADLINE being misleading in saying foreclosures were up 9%.
July 16th, 2009 at 12:30 pm
Barry,
Have you ever peered into the guts of your blog? This morning, early, I posted a note about the distortions of the unemployment numbers today…30 minutes later it hadn’t posted…so when I got to the salt mine, I posted something similar as I thought the point was valid.
Now 4 hours later the original post shows up…this happens occassionally at TBP and I am thinking the digestive system at TBP is on the fritz…perhaps it needs a colonoscopy to see why its digestive mechanism is so screwed up…I suspect I am not the only one who has seen this event before…maybe there is a blockage…maybe some Pepto….maybe an enema…eh?
July 16th, 2009 at 12:30 pm
Re the topic of this thread, more news regarding Guaranty Bank in Texas:
http://www.dentonrc.com/sharedcontent/dws/bus/stories/DN-Guaranty_16bus.ART0.State.Edition1.3cf5e78.html#
This is more than a canary in the coal mine wrt RRE in Texas. As an aside, I have a cousin who does production work on reality shows, the flip this effin’ house kind of stuff, well, she had been in Austin a few months ago doing the prelim setup for an RE type show to be filmed down there and it all went kablooey when the principal subject of the show, some freakin’ shyster, got hisself all indicted and what not! I took that news as a canary, a big g-d canary with hairy knuckles and a pinky ring screaming ‘let me outta dis cage! I don’t wanna go back down there!’
July 16th, 2009 at 12:31 pm
cvienne Says:
July 16th, 2009 at 12:24 pm
Is the dollar going to COMPLETE a 5 wave down (since March) and thereby FINALLY get this whole thing overwith…I’m tired of it dicking around here on support when I could could be off to the beach!
reply:
—————–
The outcome is certain.
July 16th, 2009 at 12:35 pm
@cvienne:
“Dollar craps around here, and I have to stay close to home and weed my garden, put up fenceposts, mulch, and paint the bathroom…”
Take a laptop to the beach and hire Jesco White or one of his relatives to do those odd jobs- I hear they aren’t too busy lately.
http://www.boingboing.net/2009/07/14/richard-metzger-inte.html
July 16th, 2009 at 12:38 pm
“Is the dollar going to COMPLETE a 5 wave down (since March) and thereby FINALLY get this whole thing overwith…I’m tired of it dicking around here on support when I could could be off to the beach!”
No – it is going to dick around endlessly and waste your time of course… now go to the beach !!
July 16th, 2009 at 12:42 pm
WASHINGTON, July 16 (Reuters) – The Obama administration is looking at ways for homeowners who have defaulted on their mortgages to remain in their homes as renters, senior administration officials said on Thursday.
U.S. Treasury assistant secretary Herbert Allison told the Senate Banking Committee that the idea was one of several options under consideration for homeowners whose mortgages can’t be made affordable through modification.
“It’s certainly an idea we are thinking about,” Allison said.
William Apgar, senior mortgage finance adviser for the Department of Housing and Urban Development, said the administration was exploring a “wide range of options along these lines.” However, he said a key obstacle is that homeowners who have gone through the anguish of delinquency and foreclosure often don’t want to stay in the property as renters. (Reporting by David Lawder; Writing by David Lawder and Tim Ahmann; Editing by James Dalgleish)
July 16th, 2009 at 12:44 pm
Aloha! Hawaii foreclosures up almost 500%
http://www.starbulletin.com/business/20090716_Worst_in_foreclosures_yet_to_come.html
July 16th, 2009 at 12:46 pm
jc
ANYTHING to avoid having bondholders and the banks realize losses. No matter the moral hazard or the social unrest that comes about as a result.
And, it won’t work.
July 16th, 2009 at 12:49 pm
Re: Hawaii. Ha! That’s one of those places where the RE investors have been very arrogant and hubristic about the prospects. You know the line: They’re not making anymore land here in paradise, etc.
It’s going to hit them like a brick from behind.
July 16th, 2009 at 12:51 pm
@jc
Kinda makes me pissed off…
I paid cash for the house last December…Why the hell didn’t I just take a mortgage out on it, NEVER pay an installment…save the cash, now I could rent…
…and I could call Obama when the toilet gets leaky…
July 16th, 2009 at 12:55 pm
MRegan – very interesting article – especially considering my mortgage is with Gauranty Bank
July 16th, 2009 at 12:56 pm
cvienne
Ha! It does bring up the question of who’s going to be the owner and what exactly is the relationship? Will there be a landlord? Or will the “renter” still have the responsibilities of ownership without the benefits?
I just can’t see anything good coming from this. It’s just more kick the can policy.
July 16th, 2009 at 12:58 pm
As I said Oil made a new high today, but because of Aug expiration it is all over the map. I lightened up on my long positions. But I wouldn’t short Oil right now until early next week. Added more to my $COF shorts. GS is doing a fine job propping up the stock for opex Friday.
July 16th, 2009 at 12:58 pm
JC – I’ve heard that at least here in CA – many of the banks are not fully repossessing homes. The banks have figured out that it’s cheaper and safer for them to allow former home owners to remain in their homes because so many of the empty home are being broken into and vandalized. Letting people stay keeps the home up and saves them money on maintenance.
July 16th, 2009 at 12:59 pm
Re: Rhode Island. Lived there for about 5 years once upon a time. Mannwich and cvienne have nailed it pretty well. They have little to no industrial base to draw on that isn’t tied to gov’mint or the Mob up in Providence, which apparently has not yet filed a DBA under that name.
When the saving grace, new-new tech was GTECH, it became clear that they were still fresh out of truly good business ideas.
Splendid area to live for a while, though. Beautiful.
July 16th, 2009 at 1:02 pm
“one of several options under consideration for homeowners whose mortgages can’t be made affordable through modification.”
It sounds like the loan mods won’t even touch the -25% underwater homeowners now and the banks already have an inventory of about 1M foreclosures, half that they own, they must be holding them and lobbying Uncle Sugar to pay them “fair prices” to become landlord to the dispossessed homeowners from whom Uncle Sugar will collect a “fair rent”. So the banks get a windfall with US paying above market prices to collect below market rents from people who are mad at the world and eventually US will end up with an awful lot of trashed homes. The really , really sad thing is that it’s probably the best available solution. I’m sure this is why the banks keep holding their invisible inventories and not selling them.
1 million foreclosures now with 50B of available TARP bucks, so a gift of $50K per abandoned home to the big banks.
July 16th, 2009 at 1:04 pm
Thor
Indeed. It’s just more evidence of the banks not dealing with the reality of the situation and hoping it will somehow all just get better, helped along by their enablers at Treasury and the Fed, of course.
Zombie economy.
July 16th, 2009 at 1:11 pm
What about the investment properties, those foreclosures will be enough to crater the markets in FL,NV and SC , right? Maybe enough in CA and AZ too but as long as Uncle Sam is paying a “fair” price to the banks for their foreclosed properties the banks are insulated from cratered housing values.
July 16th, 2009 at 1:17 pm
I’m going to Vegas this weekend to see the in-laws, they live in Henderson. I’ll let everyone know what my impressions are from the last time I was there (Christmas).
July 16th, 2009 at 1:18 pm
@Bruce N Tennessee, seen similar things, one post was “made in the future”, kept staying at the bottom as more posts were made with a future posting date. Maybe we are starting to see the first indication of artificial blog intelligence.
July 16th, 2009 at 1:20 pm
Onlooker @ 12.49:
Arrogance and hubris almost always earns a brick in the end…. unless you are GS.
July 16th, 2009 at 1:22 pm
@Super:
I think it is simpler than that..I think blogs have genders…and Barry’s blog must be feminine and operates when it wants to…
…If I see Karen around I will get her opinion on my theory…..
July 16th, 2009 at 1:26 pm
LB said: …. and buy some Treasuries. Better still watch Gary Shilling’s video and then buy some Treasuries.
Lefty, I’d love to play with you guys in the sandbox but we’re still over-levered Americans.
I’m still waiting for that very special $10 million personal injury client to walk in the door.
Speaking of which, have any of you on here ever been hurt by ANYONE?
July 16th, 2009 at 1:33 pm
http://www.businesstimes.com.sg/sub/latest/story/0,4574,342119,00.html?
Harley-Davidson slashes 1,000 jobs as profits skid
WASHINGTON – US motorcycle maker Harley-Davidson said on Thursday it would cut 1,000 more jobs this year after a devastating second quarter as the global recession slashed sales.
The Milwaukee, Wisconsin-based company announced the new job cuts along with a 91 per cent plunge in second quarter net profit from a year earlier.
…91% drop in motorcycle profits… perhaps TARP money for “Hogs”…worked for GM….and we’re going start paying mortgage payments….I could see it. Just another brick in the wall…
July 16th, 2009 at 1:33 pm
I get hurt by karen all the time…
Should I sue her?
July 16th, 2009 at 1:35 pm
Tranzor:
I had a girlfriend once who only washed her hair on Friday and Saturday nights…does that count?
July 16th, 2009 at 1:39 pm
I was reading CNBC.com thsi afternoon and saw another joke on what I call are “Less Bad News=Good News” on CNBC. The headline thsi afternoon is “Homebuilders: Sales Improving But the Market Remains Weak”. It is followed by “US homebuilder sentiment in July jumped to its highest level in 10 months as improved sales conditions boosted confidence in the market for new single-family homes, an industry group said on ThursdayThe National Association of Home Builders said its preliminary NAHB/Wells Fargo Housing Market Index was 17 in July, up from 15 in June.”
What the article tries to hide in the detail is “Readings below 50 in the index, which was launched in January 1985, indicate more builders view market conditions as poor than favorable. ”
So, why do we give a rat’s ass if the reading is at 1/3 of the level required to just mainatian mimimum confidence?
July 16th, 2009 at 1:41 pm
Tranzor – hrmmmm, so if I fling myself down the stairs here at work and hire you . . .
July 16th, 2009 at 1:44 pm
SP500 looks like a little triangle forming here near the top….maybe we get a leg up to 938 and then crap out….This rally hasn’t even hesitated at any fibbo’s, buy maybe the 78.6% will provide some resistance at 938. What a short covering rally….no pull backs….no chance to get out of shorts…just unrelenting short covering….love it.
July 16th, 2009 at 1:45 pm
Bruce, I think you should call my office right away.
If you had a particular susceptibility to rejection and that young woman, knowing that, deliberately set out to deceive, humiliate, and devastate you emotionally — I
put the settlement value of your well-lipsticked pig of a case at a couple grandbelieve you are entitled to justice.July 16th, 2009 at 1:47 pm
Thor:
Noooooo!!!! Don’t do it, Thor!
Because
that’s Workers Comp short moneythat would be wrong.July 16th, 2009 at 1:47 pm
http://www.sacbee.com/budget/story/2029752.html
Electronic trades will cash out California IOUs
…It appears if a California vendor actually needs money, that the IOU’s will bring 80-90 cents on the dollar…the little guy (the vendor) gets reamed again, and the fat cats will cash the IOU’s plus 3.75% in October…
“The market took flight after most of California’s big banks stopped honoring the IOUs last Friday, leaving some IOU holders scrambling to cash them. SecondMarket said hedge funds and other deep-pocketed investors are prepared to buy notes at a discount, providing immediate cash.
Bidders are offering 80 to 95 cents on the dollar on Craigslist and other Web sites.”
I still think National IOU’s could pay for everything…we just aren’t creative enough!!
July 16th, 2009 at 1:48 pm
“I get hurt by karen all the time… Should I sue her?”
I-Man is SENSITIVE. Almost EMO. We feel your pain.
NAHB index up from 15 to 17 – that’s like two blokes with 1″ weapons comparing size.
Waiting around for the $/€ impasse to resolve itself and hence determine the direction of stocks, bonds, oil, and gold – because it is ALL ONE TRADE is becoming extremely tedious.
July 16th, 2009 at 1:49 pm
Tranzor:
Pretty good. Got a grin.
July 16th, 2009 at 1:49 pm
I am a little sensitive Left.
I just wish we could all be on the same side of the trade… this inflation/deflation thing has us so fragmented.
Maybe someday.
July 16th, 2009 at 1:57 pm
Pushkar:
You better get to your remedial class, bud. If you aren’t in touch with your feelings here, you will never be able to pass a “green shoot”. Concrete numbers are passe, and feelings are the new pet rock….so suck in that gut, and start getting emotional…find your inner child, pick some daisies, buy a puppy…
July 16th, 2009 at 2:00 pm
Tranzor,
Sometimes I get a headache hearing about Franklin’s green shoots. How about that?
July 16th, 2009 at 2:04 pm
Pushkar:
I think you need the “neutron bomb” of emotional therapy..
Go to Blockbuster…rent “Mama Mia”and watch it with ten female coworkers and no other men.
You’ll never want to watch another Colts game again. Cured…
July 16th, 2009 at 2:18 pm
@ben22:
First, I am sorry you are experiencing pain. Second, I think you should call my office right away.
Diagnosing the real source of your headaches is something that requires medical attention from a doctor specializing in being a paid witness in personal injury cases. The fact that you are reading annoying posts by Franklin may be just coincidental — as unlikely as this may seem. We will leave no stone unturned in discovering a lucrative cause behind your pain.
July 16th, 2009 at 2:22 pm
OT – Am I the only one who’s fascinated by the flow of our posts? The direction the conversations take away from the topic of the original post, through the morning and afternoon stock chatter, into the evening’s more general and philosophical discussions. I’d imagine the social scientists would have a field day in here.
July 16th, 2009 at 2:27 pm
lol Transor.
@Thor,
That’s why it’s The Big Picture
spike up here in the markets, any afternoon predictions for price action, we’ll see if we get to AT’s 938.
July 16th, 2009 at 2:28 pm
Look out I-Man, a spot of cold steel headed our way…
Anyone have data on the Mondays after Op Ex? I bet the statistics show they are usually down.
July 16th, 2009 at 2:30 pm
Screw em, they can keep poking at me. I’m not going away.
July 16th, 2009 at 2:31 pm
@Thor:
Is social scientist a buzz word for psychiatrist?
July 16th, 2009 at 2:31 pm
Got some $FAZ for a trade..
@left: i predict a deep correction post opex.
July 16th, 2009 at 2:32 pm
Where is CNBC Sucks? I thought this was an indie crowd, and now we seem to have emo busting out all over.
July 16th, 2009 at 2:34 pm
@ Manhattan
Agreed. This is all a setup going into opex. And this nice little… what is it now 7%? run since Friday’s close fueled by short covering is going to make the correction even deeper and faster.
July 16th, 2009 at 2:37 pm
Economists are social scientists . . .
July 16th, 2009 at 2:37 pm
Hey, Tranzor!
The 47 year old law school graduate who was 400k in debt for his law degree and the state of NY wouldn’t let him sit for the bar…has he contacted you yet?
And if you win, would you take an IOU?
July 16th, 2009 at 2:40 pm
@manhattan: I was wondering about FAZ, but ahead of – or after GE, C and BAC reveal their polished turds?
As usual LB will let Mr Market and the technicals guide our moves. Our balls are fine so far.
In other news, “The Mechanic” leads at Turnberry, and England peed away an early advantage in the 2nd test.
July 16th, 2009 at 2:47 pm
@ben22
“any afternoon predictions for price action”
I don’t have any predictions for the afternoon, but I’m working on a new visual right now…
1. When the S&P blew out 931 to the upside, I had to toss out the FIBO retracement idea & factore a 956 “double top” back in.
2. I’m still thinking 956 was the TOP…The 233 day EMA is right around 960 (and closing in fast)…A break ABOVE the 233 day EMA and I’d be 100% in cash (because I’d be AFRAID of a thrust higher)…I think the 233EMA would provide topside resistance (it’s a line that hasn’t been crossed yet because when we hit 956 before, the EMA was up around 980…
3. So if I factor 956 top into the equation, and most of the minor FIBO numbers have been breached, I need something LARGER…
4. I was looking at a “channel”…I’ve always used the 10/10 low and 10/14 high as a good indicative channel…10/10/08 was a HUGE volume day (capitulation)…It also marked the LOW on the MACD wave…The “lower lows” on the S&P in my mind were divergence (that indicated a rally was soon coming)…
5. So if you connect the “slope” of the 10/14 high through 956…then create a parallel lower channel you see some interesting things…The LOWER bracket of the channel was breached TWICE, yet the market quickly recovered, and then the same line was a demarcation point for a rally…12/05/08 comes to mind, a minor attempt on 1/20 (inauguration day), and March 30th (the first real TEST of the rally, plus the start of a new fluffy quarter)…
6. So I’m thinking that this “channel” might hold…It needs one more test to the upside…and that could happen somewhere around the 940-943 level (depending on the day)…
Other factors that play in to this are things like EW patterns in other areas, the dollar completing it’s move down, etc…
FWIW – I’ll hold onto this theory until it gets proven false…as always…
July 16th, 2009 at 2:48 pm
@Lefty,
Here is some info along those lines from the trusty Almanac but specifically for triple witch months.
Triple Witch expos, all in relation to the DOW:
TWW= Triple Witching Week
1. TWW’s became more bullish since 1990, except in the second quarter
2. Following weeks became more bearish. Since Q1 2000 only 10 of 32 were up and 5 occured in December.
3. TWW’s have tended to be down in flat periods and dramatically so during the 2000-2002 bear market. (Remember 2008 wasn’t over at press time for the 09 Almanac)
4. Down weeks tend to follow down TWW’s. Since 1991, of 22 down TWW’s, 17 following weeks were also down. The previous decade had almos the exact opposite pattern.
5. TWW’s in the second and third quarter (Worst six months May-October) are much weaker and the weeks following, horrendous. But in the first and fourth quarter (Best six months) only the week after Q1 expo is negative.
There are some things in the Almanac about Down Friday’s followed by Down Monday’s but not in relation to options exp.
July 16th, 2009 at 2:49 pm
Note…
The same channel, if BOTTOM TESTED, puts the S&P around 700 by late October
July 16th, 2009 at 2:49 pm
@left: My opinion is that GE, C, BAC results won’t provide as much boost to markets as GS results did.
Last hour today will be interesting.
July 16th, 2009 at 2:52 pm
Bruce
LOL re: the IOU from the indebted lawyer. He could be Transor’s indentured servant. That should last for decades!
July 16th, 2009 at 2:54 pm
damn cvienne,
I’m going to need to sit down at the desk with some tools and a pencil before I get that entire 2:47 post. thanks.
July 16th, 2009 at 2:55 pm
The march higher continues. Amazing. Tech, in particular, has shown amazing resiliency.
July 16th, 2009 at 2:56 pm
Look at it Ben…
The correlation of the 10/14/08 high to the 956…
and the PARALLEL lower channel (from 10/10/08) which connects some surprising support levels (only breached in a minor way)…
are startling…
July 16th, 2009 at 2:57 pm
sold rest of my $UCO longs…tomorrow we might put in a DOJI on S&P candle. This short covering rally is unbelievable.
July 16th, 2009 at 2:57 pm
Ben and cvienne:
I tried to replicate what you guys were explaining…I wound up going off my paper and writing on my desk….
Could we have the Cliff Notes version, please?
July 16th, 2009 at 2:58 pm
@Bruce:
No, and that’s one I would “only take on retainer,” as we say.
Unfortunately for him, there are very few cases where bar applicants denied admission end up getting in. It’s a lot easier to keep ‘em out than kick ‘em out.
The fact is his credit rating is currently screwed and when the story was written he had not yet taken substantial steps to resolve his dispute with Sallie Mae. So on paper he looks like a deadbeat. State bars tend to be hard-asses when it comes to applicants. I’m skeptical where he says Sallie Mae never responded to him for 2 years at one point — that’s much too long to let something go without escalating.
I feel bad for him, but he’s going to have to get his house straightened out. If he makes 12 monthly payments and negotiates something with the lender and gets his credit straightened out a bit I’d be willing to bet they’ll let him in.
July 16th, 2009 at 3:00 pm
WFC which is getting billions of TARP and almost free money from the Fed won’t redeem CA vouchers! NICE!
Their irresponsible mortgage lending had a lot to do with the current crisis in CA – above and beyond their ownership of Golden West.
July 16th, 2009 at 3:01 pm
Bruce – not sure, I think I may have made up the term social scientist – I was talking about sociologists, psychologists, historians . . .
July 16th, 2009 at 3:01 pm
Insurance companies are big holders of CIT bonds.
Watch this space, insurance and pension funds will blow up.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aX.Sg5V899KM
“Could we have the Cliff Notes version, please?”
It’s a massive squeeze, Bruce.
July 16th, 2009 at 3:03 pm
S&P 500 crossed the 200EMA at about 936. I’m sure that sparked a whole new round of knee jerk buying and short covering. Of course that level kept things capped back in June at the 956 intraday top. Will it do so again?
July 16th, 2009 at 3:04 pm
…one last note
If 956 is taken out to the upside (and negates MY channel)…The performance of the indices (since 10/10 – 10/14) could take the S&P to 1080…
…so hold onto your hats
July 16th, 2009 at 3:05 pm
Yeah… I think all this cold steel on my balls might actually be turning my balls INTO steel.
I’ve learned alot on this trade… more than I signed up for anyway.
July 16th, 2009 at 3:06 pm
@OT
I still don’t like 200 day MA’s…They’re some kind of “sissy Rubicon” to me…
I’d like to see what happens at the 233 day…That’s up around 959 as we speak…
July 16th, 2009 at 3:08 pm
cvienne,
I’ll have to mess with it tonight, I’ve got to keep my eye on ever screen from 3-4 each day but I’ll work on it. I think I can eyeball what you are saying though.
Bruce,
Here’s my cliff notes version, if you aint trading you are way better off in those callable cd’s you were buying so many months ago. Though, I do recall, didn’t you take a position in FXI? A toe or two?
LB,
Re: insurance companies.
In coming years, or sooner, I think the main criminality you will hear about with insurance companies are the current annuity contracts they are pushing really hard that promise income over one’s lifetime regardless of market performance. People are going to find out that it doesn’t work, or they are going to pay up on the M&E of the contract in order to maintain this promised income. Those and index annuities I’m thinking are going to come under major fire in the coming years.
There is no free lunch but these are getting pushed as just that, and reps, we make a ton on annuity sales.
July 16th, 2009 at 3:09 pm
@ CV:
Short Sissy Rubicon.
Long FJ40 with a 350 in it. Out herre we call em Chevota’s.
July 16th, 2009 at 3:11 pm
is it time for me to start getting louder again with the 965-1k rant I had been on for so long?
July 16th, 2009 at 3:14 pm
FXE is stuck into firm resistance here, just below 141.5. This is CRITICAL.
Man, these final trading hours can go slowly.
We added to our oil short, to DUG, and to SRS, and dipped a toe into FAZ.
July 16th, 2009 at 3:18 pm
what a snoozefest on silver and the dollar. Saw Macro Man was doing some silver futures this morning.
July 16th, 2009 at 3:19 pm
@LB
What’s interesting, I think, is if the Euro makes a break up (and the dollar down), it most likely would cause the end of a 5 wave in each…
But by doing so, it would toss the S&P up above 956 9which would get people thinking “rally on Garth”…
Now THAT would be a headfake!
July 16th, 2009 at 3:22 pm
@CV: Do try not to talk the $ down here please, while some of us are experiencing cold steel? Thanks, old chap.
Party on, dudes… loved that movie, So-Crates.
July 16th, 2009 at 3:24 pm
@LB
“So-Crates” was from “Fast Times at Ridgemont High” (also a classic)…Party on (Wayne’s World)…
July 16th, 2009 at 3:26 pm
“So-Crates” was from Bill & Ted’s Excellent Adventure as well, no?
July 16th, 2009 at 3:27 pm
RE: RI unemployment
manufacturing is the biggest sector up here, with retail services ranking high as well…nuff said.
a corporate tax rate at 9% one of the highest in the country doesn’t help either. most of the populace is concentrated in the urban areas and nobody round here is willing to travel. it’s a weird local cultural thing. for example i’m working on a masters degree at URI, i live in Providence. people say,” you go all the way to URI twice a week?!” like they can;t believeit. it’s 35-40 min drive door to door.
transZ is right, there are some co’s up here like CVS, Amica, FM Global, Textron, Amer. Power Conversion, etc. Fidelity has been moving a lot of business segments here, but Boston metro area is 25-30 miles north, and NYC to the south probably hurts too.
RE: the Lincoln RI Cas*no – they have or will soon file a petition for U.S. Bankruptcy Court protection from their creditors, the place is mostly a ghost town, real nice though.
July 16th, 2009 at 3:28 pm
Mannwich,
Yep, that was also in that movie. Wild Stallions!
July 16th, 2009 at 3:28 pm
CA has 11-20% unemployment now, state employees are losing 13% of pay thru furloughs and state vouchers are being factored down 15-20%. Isn’t that a depression?
July 16th, 2009 at 3:32 pm
Obviously, I should have been moderating the group today… but no one listens to me anyway. No need to talk the dollar down, as it is falling of its own volition.
July 16th, 2009 at 3:33 pm
Don’t look now but GOOG is either about to DOUBLE TOP, or break out to a new rally high…
July 16th, 2009 at 3:34 pm
I did my best to pull you out of the shadows…
July 16th, 2009 at 3:35 pm
Double top on GOOG = Triple top on Q’s
July 16th, 2009 at 3:36 pm
Good trick, I-Man, as I was wondering what I had to do to make amends…
July 16th, 2009 at 3:36 pm
Re: dollar down
Great…just what this economy needs, dollar collapsing, oil specs in charge, and gas prices going back to $4…
July 16th, 2009 at 3:36 pm
does anyone else have access to or read the now named BAC/ML RIC Report?
The most recent is interesting….
July 16th, 2009 at 3:38 pm
…and while they’re at it…collapse the bond market…
Then the whole world can pile into the S&P…
July 16th, 2009 at 3:41 pm
Wow, the squeeze goes on and on! Impressive and somewhat painful. Will be traveling tomorrow. Wonder how the week will end? Should be very interesting.
July 16th, 2009 at 3:42 pm
@cvienne: That double top in the markets might happen tomorrow and then a deep reversal. I don’t think we will break above 956.
July 16th, 2009 at 3:43 pm
The Mistress is obviously on the long side today, and thoroughly enjoying the agonies of the dollar bulls.
Look, we are experiencing COLD STEEL here. It’s not fun..
It’s been a bit EMO here today, I should warn you
July 16th, 2009 at 3:44 pm
yeah I’m feeling the steel on the long dollar trade, at least it isn’t a cactus?
Check this out:
http://www.cnbc.com/id/31947275
July 16th, 2009 at 3:44 pm
FWIW
Ben – we’re right on that 943 number now…so my theory will be tested…
July 16th, 2009 at 3:44 pm
Lets go ahead and shoot for 956 before the close!!! WEEEEEEEEE!!!
July 16th, 2009 at 3:45 pm
ben22 @ 3:08
The other thing about a fixed annuity is, if it’s not indexed to inflation, it’s potentially worthless.
And if it’s indexed to “core CPI”, it may still be worthless.
And the fees on variable annuities can be rather high.
July 16th, 2009 at 3:45 pm
The EUR:JPY isn’t following SPX in the usual manner. This seems like a low volume summer pump job.
July 16th, 2009 at 3:46 pm
does anyone know why fdx is having such a good day?
July 16th, 2009 at 3:48 pm
@karen
Maybe people are mailing themselves around the country to save $$…
July 16th, 2009 at 3:49 pm
Index futures rally. XLF, C, BAC and GE are all lagging, folks.
July 16th, 2009 at 3:50 pm
@karen: Does there need to be a “reason” anymore?
July 16th, 2009 at 3:50 pm
I’ve noted some rather large dumps of XLF today, fwiw.
July 16th, 2009 at 3:51 pm
DL,
No they are just plain high those fees, very good points as well about fixed annuities. It’s sad because it’s often seniors that get burned on these.
Or, here’s a story, I have two young clients that were given 100k by parents a few years ago. At this time they were working with another rep, they told the rep they wanted to put the money away to eventually buy a home with but that for the time being they just wanted to rent. So, what was suggested to them for a savings vehicle, yep, a variable annuity.
To further it, 1/2 the variable annuity was in short term bonds, when you look at the subaccount fees I don’t know for the life of me why you would be buying bonds in there, unless you were stuck in the contract and were just trying to protect your money.
I won’t even get into the tax implications of what he told them to do.
July 16th, 2009 at 3:52 pm
@karen: “FedEx says Soft Demand to Continue in 2010.” Maybe that’s why they’re up 8%+ today? After all, up is down and down is up these days. Makes total sense to me.
July 16th, 2009 at 3:53 pm
ben22 @ 3:11
SPX @ 965 before the end of August… possibly.
But the question is, which do we see first, 810, or 1000…?
I say 810.
July 16th, 2009 at 3:53 pm
wonder how many colleges/university will be facing this in the coming years, probably most:
In introducing a new round of potential state budget cuts for 2009-10, Gov.
Ed Rendell proposed last week what could be devastating cuts in the
Commonwealth’s appropriation to Penn State. The governor’s proposed reductions
would set the University back to its appropriation level in 1996. Penn State
would go from the current year’s initial appropriation of $338 million to $278
million in 2009-10.
July 16th, 2009 at 3:54 pm
Exactly Manny. But if this rally is communicating to folks that a real recovery is around the corner then this kind of very economically sensitive stock would be a winner. I’m not convinced, to say the least, and certainly wouldn’t be buying FDX at this level. UFB
July 16th, 2009 at 3:56 pm
hmmm…943 then a pullback…how odd
http://www.ritholtz.com/blog/2009/07/foreclosures-rise-9-in-1h-2009/comment-page-4/#comment-194385
July 16th, 2009 at 3:57 pm
Man, folks are throwing around 10K lots of XLF like its chump change.
July 16th, 2009 at 3:58 pm
@ben22:
Add universities to the pension funds and insurance companies. Tuition bubble, meet deflation.
July 16th, 2009 at 4:00 pm
Anybody shorting into the close? It makes me sick to the stomach so I’m inclined to think it’s the right move. Just took another bite shorting UWM.
July 16th, 2009 at 4:01 pm
I-Man @ 3:57
I tried shorting XLF recently, and my broker wouldn’t let me do it.
Just seems odd, given how liquid it is.
July 16th, 2009 at 4:01 pm
I told you guys B in T was WAY smarter than he looks:
CBO: Health Reform Bills Moving the Wrong Way-
CNNMoney
The health reform bills released so far would increase government spending on health care without sufficiently reining in health care costs. And at least initially they aren’t likely to significantly lower premiums for the majority of Americans with employer-sponsored health insurance. That’s the sobering takeaway from testimony Thursday by Congressional Budget Office Director Douglas Elmendorf.
I know, I work in the industry and must not be able to see the forest for the trees…but be careful what you wish for…
July 16th, 2009 at 4:03 pm
Roubini says the worst is over….
It just goes to show you that economists who don’t even have a trading book can get squeezed out of their position. Funny stuff….
July 16th, 2009 at 4:04 pm
Getting ready to take a bite out of SMN. Down 20%+ in last 5 days.
July 16th, 2009 at 4:05 pm
@I-Man:
Somebody just tossed out 474000 shares of COF.
July 16th, 2009 at 4:06 pm
Google down after despite good numbers. If the double top is true for Google, I will wait until tomorrow to open shorts on Google. I think we will see this stock under $400.
July 16th, 2009 at 4:07 pm
@emmanuel: I suspect those were the investors who bought $COF secondary at $26. I hope it will go up tomorrow so I can add more to my existing shorts. COF does not deserve post dilution value of $40.
July 16th, 2009 at 4:07 pm
Added to the shorts here and there between 3 and 3.45pm. Balls still intact despite firm cold steel pressure.
Don’t be surprised to see a little head fake move up tomorrow on Better Than Expected earnings, before the selling starts after 10am – until we hit whatever number the remaining options guys are most heavily into.
My bet is that Blankfiend is already in the getaway car and waiting outside. Sell the SPOOs and buy the TWOs.
If we wake up on Monday morning to a monster rally in the $ and yen, you will know what is going down.
July 16th, 2009 at 4:08 pm
@OT
I’m not shorting here (nor am I really short much except for a little FXP & SRS)…I wanted to keep a lot of cash because this rally has been so out of control…
What’s IMPORTANT is your point…I do know one thing…If I’d been 100% short I’d definitely be sick to my stomach now, I’m almost sick to my stomach just WATCHING it (which probably means we’re at or near a reversal)…FWIW
July 16th, 2009 at 4:10 pm
@LB
“Sell the SPOOs and buy the TWOs.
If we wake up on Monday morning to a monster rally in the $ and yen, you will know what is going down.”
—
The table is sure set perfectly for that isn’t it?
July 16th, 2009 at 4:10 pm
Bruce N Tennessee @ 4:01
A person doesn’t have to know much about the health care system to know that Obama is going to dramatically understate the costs of his health care program, and that he is going to dramatically overstate the revenues that his “tax hikes on the rich” will generate.
July 16th, 2009 at 4:14 pm
Another 75000 COF shares…
July 16th, 2009 at 4:15 pm
You think you’ve been sick CV…
You dont know the half bro. One of the toughest weeks of my trading career this week so far. I’ve come a long way with emo control. A year ago I wouldnt even be on this board given the week Ive had.
July 16th, 2009 at 4:16 pm
I’ve felt your pain, I-Man. I got spanked a bit myself during the March – May/June run up but I’ve regrouped to battle another day. You’ll do the same, I’m sure.
July 16th, 2009 at 4:18 pm
AT,
I just posted a link to the Roubini call above. Prechter predicted many economists would flip towards the end of Primary 2, if that is in fact what this is. And he predicted this back in February.
July 16th, 2009 at 4:21 pm
What an excellent set-up for Google shorts eh?
“Dr Doom” apparently threw in the towel
Roubini Now Says The Worst Of Economic Crisis Is Over
http://www.cnbc.com/id/31947275
July 16th, 2009 at 4:22 pm
@I-man
I feel 4 ya brah…
I’m only running a light temperature…
I’d stated last week on these boards that I wasn’t 100% on board with the break below 880…I took some profits there and have held cash since…
I wasn’t convinced of the rollover until we got a 2nd test of 956 (the first was 931)…I’m actually THANKFUL that it took out that number so easily otherwise I might have been inclined to add to shorts…
I’m gonna wait this one out 4 now…
Above 956 (and a break & settle above the 233 MA), and I’ll be convinced to cover the shorts I have…But it also has to be coincident with a dollar move…If the dollar breaks down and completes a 5 wave AND the S&P screws around with 956 but doesn’t charge up on that, I’d think it would be HEADFAKE CITY and really want to be long dollar & govvies…JMO
July 16th, 2009 at 4:24 pm
I-Man:
LB thinks that having gone through a few ugly squeezes helps to habituate traders to the proximity of the cold steel to their Prized Assets. The emo control comes from saying: “oh yeah, this is all very familiar”, as the jaws begin to clamp tighter around the Crown Jewels. LB also takes comfort from holding mucho cash so he can practice “dollar-cost averaging” into the squeeze as it goes vertical, thinking of Suze Orman* as he does so.
* Not really.
July 16th, 2009 at 4:27 pm
all, don’t forget that article br posted a few days ago, the advice was, if you are in pain, swear.
two beats after hrs. what a shock.
I’m thinking next Tuesday will be a big day. You’ve got AAPL, CAT, and KO just to name a few reporting then.
July 16th, 2009 at 4:28 pm
WOW I’m feelin the heat today, went short SSO yesterday slightly ahead of AT call only I didn’t use any stops, but I sold more puts today to generate more flow. Hoping for a reversal next week.
This is not a market anymore it’s ‘robot wars’
July 16th, 2009 at 4:32 pm
@ Manhattan:
On GOOG:
Totally… that will be a great trade for those wishing to take it.
Unless there is some kind of wicked reversal AH, you’ll get the gap down, probably a retest of gap resistance right at the open, then an awesome short set up R/R wise.
Stop just above gap resistance, and you have a nice clean short there. Those are some of my favorite trades to put on.
July 16th, 2009 at 4:35 pm
@I-Man: I am not entering shorts today as I know these will trade all over the map going into earnings call (hint: RIMM). A safe bet would be to short tomorrow right around today’s close.
July 16th, 2009 at 4:37 pm
GOOG is down 3% after hours- so something wasn’t too exciting- and GOOG as far I know is pretty slim on guidance-
i wonder if the numbers just weren’t “blow out” enough- revenue came in almost exactly at guidance so that may be it
July 16th, 2009 at 4:38 pm
ANyone else seeing weird prints on SPY?
I have a last trade of 93.11 versus a current bid of 93.92
Last trade was 25,000 shares on a downtick.
Anyone else showing something diff? Could just be a glitch.
July 16th, 2009 at 4:39 pm
@ Manhattan:
That was intended as a trade set up for the open tomorrow. Sorry if I wasnt clear.
July 16th, 2009 at 4:42 pm
Re Roubini-
wouldn’t say he is too optimistic-
“I see so far still more yellow weeds than green shoots. They have to bottom out, in my view they haven’t bottomed out. This recovery, unfortunately, because of the debt overhang… is going to be a very weak economic recovery, in my view,” he added.”
July 16th, 2009 at 5:25 pm
DL- from Yahoo Finance-
“Democrats’ health care bills won’t meet President Barack Obama’s goal of slowing the ruinous rise of medical costs, Congress’ budget umpire warned on Thursday, giving weight to critics who say the legislation could break the bank.”
not a rousing endorsement- my guess- is that everyone is so anxious to come out with something- they could care less what it looks like- most likely will have the following features-
employer mandate to provide health care
broaden medicare to so it covers the currently unisured
so in the end we end up with the same insurance schemes we now have- no costs savings- and added burdens being placed on small businesses that are struggling already-
great plan- only shows that Obama is a shill for the insurance industry
July 16th, 2009 at 5:41 pm
ahab,
Once the program is in place, it won’t be long before they raise taxes on everyone… directly or indirectly.
July 16th, 2009 at 5:50 pm
Corus Bank and Guaranty Bank may fail tomorrow, according to CR. These are larger than the minnows we have seen failing lately. Maybe that’s why Sheila wanted to keep CIT out of her piggy bank.
http://www.calculatedriskblog.com/2009/07/market-precis-and-more-news.html
As with CIT, there are real institutions who own the debt in these puppies, and these bonds are going to end up as pennies on the $. Coming on the heels of CIT, I’d say this might put a bid into Treasuries tomorrow and Monday. Of course stocks may well continue to go up indefinitely, especially banks, REITs and leaders of Robo Market.
July 16th, 2009 at 6:13 pm
lback-
I will not bet against any of the protected 19- the TBTF’s- they have proven they have an implicit guarantee and someone would have to be a fool to bet against the full power of the Fed to create money to give to the banks to cover their losses-
must be great to be a bank- wish I had a magical Uncle who could pull $ out of his ass
July 16th, 2009 at 6:19 pm
Roubini says the drecession is ending this year and Shilling says we’re headed for a stock crash. Maybe both?
July 16th, 2009 at 6:22 pm
JC – apparently Roubini is now saying that he was misquoted
July 16th, 2009 at 6:23 pm
DL-
undoubtedly- you would think a wise man would hold off on such grand visions until the economy was at least somewhere near steady
July 16th, 2009 at 6:24 pm
jc-
Roubini was misquoted as Thor says- see my comment @ 4:42
July 16th, 2009 at 6:37 pm
Thanks I see the quote.Bloomberg was my source – apparently they have CNBCitis
July 16th, 2009 at 6:41 pm
Just a little video for everyone who was short today to help them stay…
COOL…
http://www.youtube.com/watch?v=xkdP02HKQGc
July 16th, 2009 at 7:03 pm
WSJ – Roubini comments were CNBC-ized (even Bloomberg is pumping now!)
http://online.wsj.com/article/BT-CO-20090716-718393.html
July 20th, 2009 at 7:09 am
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