Daily Archives: December 8, 2008

Is this really what we want to do to our economy?

Washington prepares to nationalize the auto industry. The Wall Street Journal, demonstrating its keen ability for understating matters, says “The auto industry would undergo a restructuring process akin to bankruptcy reorganization, only with fewer rigors and with the government, not a judge, in control, and with many associated political complications.”

Political complications like bans on challenging new emission laws, no matter how onerous, or unions demands for board participation, etc. No one pretends that $15 billion will fix the the Big Three so we’re just beginning the process. Socialism failed to save the British steel mills, coal mines or auto industry and will fail here – but we’ll have ransomed our future before that reality sinks in.

Update: Well, perhaps I’m wrong – The New York Times seems to think it’s a lousy idea, too!

It all sounds perilously close to a word that no one in Mr. Obama’s camp wants to be caught uttering: nationalization.

Not since Harry Truman seized America’s steel mills in 1952 rather than allow a strike to imperil the conduct of the Korean War has Washington toyed with nationalization, or its functional equivalent, on this kind of scale. Mr. Obama may be thinking what Mr. Truman told his staff: “The president has the power to keep the country from going to hell.” (TheSupreme Court thought differently and forced Mr. Truman to relinquish control.)

The fact that there is so little protest in the air now — certainly less than Mr. Truman heard — reflects the desperation of the moment. But it is a strategy fraught with risks.

The first, of course, is the one the president-elect himself highlighted. Government’s record as a corporate manager is miserable, which is why the world has been on a three-decade-long privatization kick, turning national railroads, national airlines and national defense industries into private companies.

The second risk is that if the effort fails, and the American car companies collapse or are auctioned off in pieces to foreign competitors, taxpayers may lose the billions about to be spent.

And the third risk — one barely discussed so far — is that in trying to save the nation’s carmakers, the United States is violating at least the spirit of what it has preached around the world for two decades. The United States has demanded that nations treat American companies on their soil the same way they treat their home-grown industries, a concept called “national treatment.”

Of course, even a blind squirrel finds the occasional acorn ….

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The news from Portland Oregon

Seems to be about the same as here – price is everything.

Update: And here’s more of the same, this time from Britain – advice there: cut your price 20%

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Hang together or separately

snakeThere are three new houses for sale on Boulder Brook (just off Dingletown): # 9, asking $6.550 million, #33, asking $6.575, and #39, asking $4.998 million. Each is 8,000 sf, each has about the same amount of land and each, according to its builder, is well made (the competing builders would not agree). # 39 has fallen the farthest, fastest: it came on in April of this year at $8.595 million endured eleven price cuts in four months and settled, temporarily, at $4.998. It’s also for rent but that’s doing no better: originally asking $24,000 per month, it dropped $4,000 today.

The other two houses have stuck pretty close to their original asking prices of $6.875 (#33) and $6.750 (#9) respectively.  I would think that, had the builder of #39 shown some solidarity with his fellow builders they might all have come out okay but as it is, I’d expect his $5.0 million house, or whatever he gets for it, to drag down the others. Financial woes can spread far reaching ripples.

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Filed under Buying/Selling Greenwich Real Estate, pricing, spec houses

To market to market to buy a fat hog,

Spec houses are still coming onto the market as they are completed, although I wonder how many of their builders wish they’d never started their project to begin with. 49 Woodland is a single family home that’s new today – I assume it’s been built but I have not seen it. From its description it sounds nice: 4500 sf spread over three levels, four bedrooms, four baths and two powder rooms, a splashy new kitchen, etc. Can a house on this street on 0.12 acre command $2.695 in today’s market? I really don’t know.

Woodland is that loop of a street that runs from the hill on Sound View over to Field Point Road. You can walk to town or the train from there but you’ll have to bring your climbing boots for that hill. And as some readers have pointed out about the trucks winding their way up Sound View, there’s some noise in the area; Woodland itself is somewhat removed from that circus but so is Idar Court and the houses there didn’t do well when they were first offered for sale.

How about a 4 bedroom house on such a tiny lot, however? Four bedrooms implies a house for a family with kids; 0.12 acres suggests a town house for empty nesters. An interesting dichotomy, to be sure. Well, as I’m fond of saying these days, we will see.

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Filed under Buying/Selling Greenwich Real Estate, Downtown Greenwich

You can’t keep a good man down

jesse-jackson-love-childPoor, pathetic Jesse Jackson, rendered irrelevant by Obama’s election victory, has licked his wounds and reemerged, ready to take on corporate America again. Other than Bloomberg News Drudge, did anyone notice his absence?

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Never have I been so eager to see someone get what he wants

September 11 suspects offer to plead guilty to all charges, seek martyrdom via death penalty.

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This won’t help

The majority of modified mortgages default again within six months. Don’t tell the bleeding hearts in Washington, but some people aren’t meant to own houses.

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Depends how you define “years”

19 Ivanhoe Lane

19 Ivanhoe Lane

This 1900 carriage house came on today for $2.995 million and is described as being located ” in a neighborhood to enjoy for many years”. I’m sure it’s very nice but I’d be more persuaded about the charm and ambiance of the neighborhood if the current owners hadn’t just bought it in May, 2006. For $2.875 million, by the way, if you’re the type to keep track of such things.

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Filed under Buying/Selling Greenwich Real Estate, Neighborhoods

So this is what those Somali pirates are up to

A reader recently used the term “contango” referring to oil prices. At the time I had no idea of what he was talking about but I now know it means the market condition where crude oil futures are worth more, after paying for shipping and storeage, than the current price on the stock market (the reverse is backwardation – who knew?). Anyway, that’s what’s happening now, indicatating that oil traders think that the price is going to go way up down the road. You can buy oil on the spot market today and lock in an 11% profit. 

Royal Dutch Shell Plc sees so much potential in the strategy that it anchored a supertanker holding as much as $80 million of oil off the U.K. to take advantage of higher prices for future delivery. The ship is one of as many as 16 booked for potential storage instead of transporting crude, said Johnny Plumbe, chief executive officer of London shipbroker ACM Shipping Group Plc.

So when those pirates nabbed the supertanker they weren’t interested in ransom, they’re determined to get themselves some of that contango!

I thought you’d want to know.

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Slow markets

26 Taconic Road

26 Taconic Road

Nothing much of interest showing up on our MLS today. This spec house failed to sell at $7.495 in 2006 and buyers continued to shun it even as its price fell this past June to $5.980. So now the builder is putting it up for rent at $20,000. The decision to rent a spec house must be a painful one, I would think, because once a house has been lived in it loses whatever premium might otherwise have attached to it as new. On the other hand, being new, at this price, obviously wasn’t drawing anyone, so some cash flow is no doubt better than none.

32 Cliff Avenue in Byram is a proposed new condo development (if two three units can be considered a development) asking $1.095 million each. The out-of-town agent says that it’s “on the New York – Greenwich border” a phrase reserved by agents who know the Greenwich market only for properties actually situated across that border (“on the Stamford/Greenwich line”, for instance, means that the property is in Stamford), and offers “easy access to I-95” which is true, as long as you have a ladder handy to climb up on the overpass above you. After asking the community of real estate agents to sell these location-challenged units for her the listing agent offers a 2% commission instead of the more customary 2.5%. That ought to get all of us out there hustling.

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Filed under Buying/Selling Greenwich Real Estate, spec houses

From the people who’ll be bringing you the Trabant II

edisonObama is gung ho on flourescent light bulbs. Here’s what one happy fan has to say about them:

He keeps talking about changing light bulbs!

Is he talking about those CFCs?! Hate, hate, hate them. Have them all over the house. A couple weeks ago, my husband accidentally broke one. Have you ever seen the clean-up instructions for them? Total nightmare. All of that over a stupid broken bulb. I will never install one in the house again, and if regular bulbs are banned, I will buy a storage shed and fill it with enough regular bulbs to last years.

More on the total nightmare that was this bulb breaking:

It broke in a storage closet. You have to throw away any bedding that comes in contact with the broken pieces. Bye bye, down comforter. Bye bye, two upholstered baby seats. You have to wipe down EVERYTHING with damp paper towels because the powder with the mercury fills the air and settles on everything. Hello, wiping down every single holiday decoration we own and other miscellaneous objects. Every tried to wipe down an artificial tree? Me neither–bought a new one. Oh, but really you aren’t supposed to just wipe up the powder; no, you have to pick up every bit of it with TAPE! Have you ever had to go over your entire carpet with tape before? It is not fun. Venting out the house and turning off the central heat was fun that day too. I like hanging out in a forty degree house.

And since the EPA wants you to use these bulbs, their directions are actually less strict than the study they’re derived from recommends. That study recommends replacing the carpet!Over alight bulb!!!

I don’t even know why these made it to the marketplace.

As noted here before, many times, if these awful things did what they promised people would buy them without a governmental edict. My liberal friends think that people are too stupid to decide these matters for themselves but they, wise, beneficent graduates of Ivies as they are, will step in and tell the dolts what they need and what they must use to heat and light their homes, where and how to educate their children (you did notice that Obama, an opponent of school choice in Washington D.C., is sending his kids to private school?) and what to drive. I admire my friends’ confidence in their native abilities and keen intelligence but I do wish they’d leave me alone.

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Here’s a recipe for disaster

"50 worst cars ever"

1975 Trabant, featured in Time: "50 worst cars ever"

Congress wants a comittee to run our car industry

 

U.S. congressional Democrats have been drafting legislation for tight government control of the crippled U.S. auto industry, including the possible creation of an oversight board made up of five cabinet secretaries and the head of the Environmental Protection Agency and led by an independent chairman or “car czar.”

Can you imagine what sort of car these people will design and try to foist on the buying public? The last state-ordered “people’s car” was the East German Trabant – the difference there was that buyers were given no choice: you want a car? Have a Trabant. At least for now, Americans can choose what they want  and they’re no more likely to buy something designed by the EPA and a committee than they are fluorescent light bulbs – oh wait, those are now mandatory! Do we see a pattern here?

The free market is doing just fine without Washington’s intervention. You want top quality, fuel efficient cars? the Japanese have been providing them for 40 years, Americans have been buying them and the market, moving in its mysterious ways, has rewarded them and punished Detroit. Christopher Dodd designed the sub-prime mortgage and now he wants to try his hand at dictating how cars should be made? We’re in serious trouble.

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Dreams collide with reality

94 Cognewaugh

9ing 4 Cognewaugh

This listing expired today, unsold. It seems to be a perfectly nice, 1958 house with no recent renovations or none that the listing agent deemed significant enough to mention on the listing sheet. The owners purchased it for $950,000 in October, 2004 and put it back on the market in April at $1.595. They never lowered that price so I assume they were of that group of sellers that says, “I’ll sell if I get my price; otherwise, forget it.”

In this market, I guess we can forget it.

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