How much gas do these things carry?

A couple of F-16s are following a little Cessna plane stolen in Canada by a student. I suppose that’s not so unusual these days, what with everything else that goes on, but I’m astonished to read that it left Canada and is now over Arkansas (headed for that secret airstrip where Bill Clinton and Vince Foster landed drugs, no doubt).

 The plane entered American airspace over Michigan’s Upper Peninsula at 3:25 p.m. today and has been trailed by the military aircraft since 4:43 p.m. as it has flown over Minnesota, south through Wisconsin, Illinois and Missouri.

The aircraft went past St. Louis flew south over eastern Missouri towards Arkansas. At one point, the Wisconsin state capitol building in Madison was evacuated as a precaution as the plane flew over the city.

I won’t pretend to know the distance between Ontario and Arkansas, but it must be quite a long way. So my question is, how far can these things run?

UPDATE: He’s landed on a highway in Missouri, so I guess he never made it to Arkansas. Says he ran away – if the only pursuers around were those F-16s, he might just make it. They were authorized to shoot him down, but once he was down, I think rocket fire would be deemed excessive.

Alternative transportation

Reader Chimney alerts us to yet another Bernie boat, a 38′ Shelter Island runabout  that was seized by the Feds Thursday out on Montauk. I want one! If only the authorities had a Chris White  trimaran to go with it at the upcoming sale, I’d be the happiest sailor on the water.

 

"Damn! We changed the name from 'Bullshit' and they still found it!"

Maybe he should have rented

Mark Teixeira, the Yankees new First Baseman and Greenwich’s new resident, went 0-4 today in Camden Yards.

Put down that sandwich and step away from the table!

Nice article on the allergy nuts. Laura Bennett  (Daily Beast) asks, “where were these kids when we were growing up?”   I’d guess we killed them all off, eh?

A Massachusetts school district recently evacuated a school bus of ten-year-old passengers after a stray peanut was found on the floor. Not an unclaimed backpack that could contain a bomb, not a mysterious white powdered substance—a peanut.

Once your child enters the greater world of pre-K education, he is suddenly introduced to the concept that a classmate might die right in front of them if they bring PB&J for lunch. Bear in mind that I am not an anaphylaxis denier. I fully acknowledge that there are a percentage of children for whom nut allergies are a serious, life-threatening situation. But I have to wonder; where were these kids when I was growing up? Did they just fall dead under the cafeteria table, swept up with the dropped spaghetti? What is causing the rise of the killer peanut?

Didn’t he call us ignorant boobs because we didn’t speak French?

Obama says he doesn’t speak “Austrian”. Well ich bin ein berliner, Baby!

Wrong wrong wrong – all wrong!

Thanks to Walt (again – Monica must be out this evening and left him with nothing to do) here’s a New York Magazine picture feature of homes put up for sale by Madoff “victims”. The last one included is that townhouse by Greenwich’s Chuck Murphy, of Round Hill Road. he worked with Walter, for crimminy sakes, so he’s hardly a victim. Still some nice houses, from the Hamptons to SoHo. One suggestion to the estate of the $2.2 million place (2nd featured):if it’s been for sale since May and you’ve only dropped it $100,000, you’ve got a ways to go.

Blumenthal does something right

Walt sent a link to this story about our state Attorney General and it seems only fair, after the scorn I heap on the man, to acknowledge when he gets on the right side of something and in fact leads the way. Blumenthal assails TARP money going to the Big Three rating agencies that created toxic loans. Standard & Poor’s and Moody’s and Fitch took huge fees to “rate” the junk being peddled by their clients and classified them as Triple A low risk when they knew damn well they were crap. Without those ratings, the entire scheme wouldn’t have worked. So good for you, Mr. Bluementhal.

“This potential $400 million windfall overpays the Big Three raters and undercuts competitors — another money reward for failure,” Blumenthal said in a news release. “The same Big Three that overrated bonds now regarded as toxic assets will be rating new bonds issued to restart lending and solve the economic crisis they helped create.”

The program, created by the Federal Reserve and the Treasury Department, is called the Term Asset-Backed Securities Loan Facility.

It provides loans to big investors and companies to buy newly issued securities backed by consumer debt, stimulating lending for auto, education, credit card and other loans.

The program starts by providing up to $200 billion in financing to investors, such as hedge funds, private equity funds and mutual funds, to buy up the debt. It has the potential to generate up to $1 trillion in lending.

Calls were placed Monday to Moody’s, Fitch and Standard & Poor’s seeking comment.

Blumenthal has written to Federal Reserve Chairman Ben Bernanke asking him to revise the program. He ways the program gives the three rating agencies an advantage and assures that their six smaller competitors can’t compete for the work.

As part of his antitrust inquiry, Blumenthal has subpoenaed Moody’s, Fitch and Standard & Poor’s for all documents and information.

The attorney general says the three agencies overrated bonds now regarded as toxic assets and say they will be rating new bonds issued to restart lending and solve the economic crisis they helped create.

Finally some good news: while Bernie’s resting in his room, Ruth’s down in Palm beach, living it up

No problems for Ruth. Federal marshalls may have seized her mansion but she’s just moved over to the Breakers and doing just fine, thank you very much.Per the Daily Bleat. Nice touch including Ruth’s sister in law in the article – the lady’s flat broke and driving people to the airport to make a living, but Ruth hasn’t retained her services.

The rage of the dinosaurs

The Associated Press is threatening to stop uses like this. That’s right, the AP is convinced that the key to survival is to stop people from linking to its stories. This despite the fact that, as the linked to article points out, links drive traffic to sites, they don’t keep traffic away:

But executives at some news organizations have called the ire at the search engines misguided, noting that much of their own Web traffic arrives through links on search pages.

AP isn’t after piddling blogs like mine, of course, its real target is Google and other news aggregators who are making a profit from what AP sees as its intellectual property. But it’d be a shame to see the effort succeed because in going after Google, the company’s sledge hammer is far more likely to fall on blogs.

As succinct a description of the market as I’ve heard

I was chatting with my friend and colleague Gary Disher just now and he described what’s happening thus: The few sales we’re seeing are, for the most part, distress sales, in that the seller has to sell. Those sellers who don’t have to sell have placed their houses way above the bottom and are just waiting, creating a huge gap between their prices and those of the distress sales, with absolutely no action in between. Buyers, today, are only interested in the bottom prices, but they go around shooting at the houses atop the gap, just to see if one of them will fall off and land on the bottom. Occasionally, one does (that $9 million house on North Street selling for $4.5 being an example). Most don’t, so the buyers move on.

So don’t think that price doesn’t matter – it does – you could sell almost any house in town tomorrow at a certain price. But you won’t want to do that if you don’t have to. So my advice is, take a good look at your position. If you don’t need to sell, you can keep your price where it is, resign yourself to getting testing bids from buyers and, eventually, the market may recover and you’ll get a bid somewhere close to what you want. If you do have to sell, then consult with your agent, check out what has sold in your category, and lower the price all the way down there. End of that problem, if not the start of new ones.

UPDATE: A reader comments, 

You’ve basically described the inefficiency of the real estate market’s pricing mechanism. What will all the brokers do while the market is frozen? The need for transaction fees would hopefully push them to advise their clients to lower their prices to a clearing level. I’ve watched asset markets for 13 years now. Wide bid offers, with the market clearing at the bid side typically means that as the buyers fill up, the next clearing level is LOWER. Sellers wait all you want but the trend and risk is the market breaks with time, not recovers.

I see that frequently. A seller rejects one, even two low bids, then decides (when no one else steps forward for six months) that he made a mistake in accepting one of them. But both bidders are gone. The next bid comes in 25% lower than the first ones and again the seller rejects it because he’s convinced that he can get what he turned down before. So that third bidder goes away and, if a fourth bidder ever does appear, his will be lower still, exactly as this reader suggests.

Take one down, pass it around …

Well, no sooner did 30 Owenoke shuffle off the stage than on comes #25, all nicely renovated and asking $3.3 million. That’s a million more than 30 just sold for, but this is a lot more house. Funny thing (funny if you’re not the owner): it was last on the market in 2005, asking $4,050,000. It didn’t sell, but four years later, this looks like a more sensible price.

UPDATE: Cos Cobber and Stanwich, please notice the lush green lawn in the photo and the foliage on those oaks, then compare them to the sorry condition of your own properties on this bleak April day. Perhaps now you’ll understand why Riverside is so special and commands such a premium.

Next month, we move it to a million!

Had you moved quickly, you could have rented 5 Conyers Farm for just $32,000 per month but you hesitated, and you lost. The new price as of today is $42,000. That’ll larn ya!

Here’s an idea for Walt

You know, just about everyone who’s anyone in the Madoff mess has a connection with Greenwich real estate. Walter’s at 175 Round Hill, another FGG guy (the fellow brought in to sell the company) owns what used to be Caey Jones’ place right up the street, Mark Madoff is at 27 Cherry Valley Road, Andy Madoff is on Tomac, Andy’s ex-wife is in Lucus Point, and Andres is in Milbrook. Even with that list, I believe I’ve missed a few. Bernie had a place here – he’s sold it, but so what?

What I’m thinking is that, with the exception of Andy’s ex-wife, all these people are going to have their houses on the market soon, either voluntarily or at the request of creditors. Why not create a “Madoff Bundle Tour”? (“He stole a bundle, you buy a bundle!”) We rent a bus, load it with the curious and the serious home buyer, and tool around town, stopping at each house? Walt could come aboard to serve Mojitos, Andy and Mark could give fly casting lessons on the bus’s roof, and Monica could teach folks how to write lovely thank you notes on the best cardstock.

We’d all have fun and maybe we could move some real estate. Walt, if you combined everything – the son in laws’ properties, Round Hill Road and maybe even Mustique, you might create a hell of a package deal. What say you?

Sometimes, a park doesn’t outweigh I-95

71 Orchard Place

This 2,600 sq. ft. condo is an easy walk from Bruce Park, the Greenwich rail road station and Greenwich Avenue, but it’s even closer to the Thruway. The builder thought that the former virtues would offset the latter and priced the place at $1.995 in May, 2007. It sold today for $1.2 million. Remember, though, in calculating market decline, this unit wasn’t worth $1.99 at the height of the market (otherwise it would have sold, eh?) so its ultimate selling price tells us nothing about what happened to comparable houses in that two year period.

Say what you will, buyers won’t listen

There’s a nice old house on Keofferam that was originally listed for $8,000 and later raised to $9,500, with this explanation: $8K RENTAL WAS FOR SHORT-TERM, FURNISHED RENTAL. RENTAL NOW LONG-TERM, UNFURNISHED.

Uh huh. Trouble is, buyers tend to think, “if you took that lower price in the first place, you ought to be happy to receive it now.” It was reported rented today. The price? $8,000.

Strange doings on Quintard

3 Quintard

A reader asked about this house on Quintard that’s being torn down and asked what was up. Damned if I know. Local OG builder/resident Peter Thalheim bought the place in July 2008 for $2.840 million and immediately thought better about it,because later that September he put it back up for sale at $3.750. Peter was the only one to see what a bargain he’d laid hold off so no one offered to pay him $910,000 more than he’d paid for it two months back. It’s been for sale ever since as both land and as a residence and it seems he’s decided to go ahead with his plans. That’s odd, in a way, because as far as I know he still has one or two other spec houses that remain unsold. It’s possible that he’s found someone who wants him to build there, which wouldn’t surprise me – he builds a nice house – but if he doesn’t have a buyer under contract, I don’t know what he’s up to. Thinking about the credit market these days, which is pretty much closed to spec building, I’m voting for his having found a buyer.

No Body Home?

Sorry, couldn’t resist. 8 Dairy Road, one of the stable of Mariani spec houses currently for sale, is listed for rent today at $25,000 per month. The house was originally listed for sale at $10.750 million and has dropped to $8.450 million (see below for my discussion of what this does to buyers’ resolve to bid low) and, with that not working, Mr. Mariani now invites you to pay his mortgage for him. Why not? Nice house.

Number 8 is so numbered because, back in 2006 when it was known as #10 Dairy Road, real estate fraudster Andrew Kissel was murdered in the basement:  hog tied with those flexicuffs riot cops like to use and stabbed about 100 times. Our police, God love them, labelled it a suicide as they always do – you don’t expect them to close a murder case by solving it, do you? – and the house was sold to Mariani for $3.475 million in 2007.  He removed Mr. Kissel from the premises, changed the street number and built anew but, whether because of ghosts or just plain overpricing, the house hasn’t moved. But here’s your chance to move in, either via a short term lease or, like poor Mr. Kissel, permanently.

Put this in your database and smoke it!

30 Owenoke

There have been so few sales recently that it’s almost impossible to say with certainty what’s happened to the market (other than dropped dead, of course). Still, we’re beginning to get some sales reported that allow at least a hazy view of what’s going on. I mentioned last week that 7 Dandy Drive, new construction, sold for $1.850 million, $650,000 less than the almost identical house next door sold for in 2007. The house shown above on Riverside’s Owenoke sold Friday for $2.3 million (I speculated Friday that it might have sold for under $2, so Riverside homeowners can now breath a bit easier). Its history is illuminating. Listed in the winter of 2006 for $3.450 million it sold that June for $2.950. In July, 2008 it was put up for sale again, untouched, for $2.995 and, as noted, finally sold for $2.3. That’s a 22% drop from its 2006 sales price.

6 Wyngate may offer some useful data but I’ve heard that it was purchased by a corporate relocation company which, if true, means we’ll have to wait until that relo sells it again to get its true value. Regardless, it sold in 2004 for $2.3 million in 2004, was put back on the market with a claim that it had been “renovated” in 2005, a claim that is undercut by the additional information that a plot plan and plans for a new house were available – I mean, who puts much money into a renovation if the house is being replaced? But it too sold Friday, for $2.195. That’s an insignificant loss, but would seem to indicate that this particular house has dropped just a tad below its 2004 value. The joker in the deck, however, remains the identity of the buyer. We’ll see.

Don’t blame this blog, blame sellers!

10 Taconic Rd

I get a tremendous amount of flack from fellow agents, all blaming this blog for the death of the Greenwich market. (My favorite quote: when someone defended me to a broker by saying, “well he’s just telling the truth” the broker responded, “how dare he!”).

But as I’ve suggested before, I’m not the one driving this death spiral, I’m just reporting it. Every day, buyers receive a message that is exactly contrary to what some agents are telling them, to wit: prices are falling, and if you wait, or toss out a low ball offer, you will benefit. Take the lovely home pictured above. In July 2008 it was priced at $8.6 million. Today it’s been marked down nearly $2 million, to $6.750. 84 Meadow Wood, in Belle Haven, asked $7.150 last June and today will accept $5.950. 34 Perna Lane, in Riverside, wanted $975,000 in October ’07 but will accept $750,000 today.

And so it goes. I represent a buyer who bid $4 million on a $7 million house last summer. The seller wouldn’t respond but has now lowered his price to $5 million. $4 million may still be unacceptable but the lesson my buyer learned is that by waiting a bit, he saved $2 million. He’ll wait a bit longer, and who can blame him?

Same thing, by the way, for rents. Today two price reductions were posted for houses on Milbank. Each started out a few months ago around $8,000, and now the owner will accept $4,000. So don’t blame buyers, or other agents, for low bids. Experience is telling buyers that they’d be chumps to offer anything like full asking price.

Cuomo apes Massachusetts’s lead, Blumenthal to follow

Andrew Cuomo, who sat back in the weeds while Massachusetts assembled a civil fraud case against Madoff feeder funds, has now charged Ezra Merkin and his feeder fund, Ascot, with the same claim. Connecticut’s courageous Attorney General, Dick Blumenthal, now has a pretty good feel for which way the wind’s blowing and we can expect him to join in the fray any month now – probably after his betters get past the initial court hurdles. But he’ll be there at the end to claim credit, in front of the cameras, I promise you.

The Ascot fund was formed by Mr. Merkin in 1992 exclusively as “feeder” fund for Mr. Madoff, says the Attorney General. It grew to hold $1.7 billion from 300 investors by the end of December, 2008. Mr. Madoff then used the money in a massive Ponzi scheme.

About 85% of the investors in the Ascot fund did not know their money was siphoned to Mr. Madoff, the complaint says. For those that knew, the truth about the size and scope of the investment was obfuscated, says Mr. Cuomo. Mr. Merkin collected an annual fee from Ascot’s investors amounting to 1% to 1.5% of the total assets in the fund – a fee that included the fictitious Madoff returns, says the complaint. By 2008, Mr. Merkin was collecting about $25.5 million a year from managing Ascot.

And if you think that set up was similar to Walter’s, try this:

Mr. Merkin was not personally heavily invested in his own Ascot fund. He did not reinvest his $169 million in management fees for the years 1995 to 2007 back into his own fund, says the complaint. All told, Mr. Merkin invested personally and through family trusts and foundations $7 million in Ascot in its first six years, and less than $2 million over the following 10 years.

I’m waiting for criminal fraud charges to compliment the civil ones but I expect those will come from out-of-state, rather than Hartford. Tough to put your golfing buddy in jail, I guess.