Daily Archives: September 14, 2009

Yes, but what doth it profit a man if he loses his soul using Bush/Cheney wiretaps?

NYC raids by FBI over weekend may have thwarted Al Qaeda attack. “Authorities raided properties in New York City today in an effort that was intended to disrupt the plans of a terror suspect whose travels had been tracked by the FBI, according to an official briefed on the raids.”

ACLU, Democrats protest.

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What’s the difference between people who want to fend for themselves and those who prefer looting?

This.

Washingon Mall post tea party

Washington Mall post tea party

Washington post inauguration

Washington post inauguration

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Rock stars and crooks for global warming

Says here that a bunch of rock bands are teaming up to make a record bemoaning global warming and that’s great – no one spews more carbon than globe-trotting rock bands so anything they can do to mitigate their damage, like getting together and singing a really cool song, is just fine by me. But I notice that they’ll be singing under the auspices of “the Geneva-based Global Humanitarian Forum, headed by former UN secretary general Kofi Annan.”

Those readers with a long memory will remember that Mr. Annan left the UN in a rush three years ago, just steps ahead of a corruption inquiry into his ties to the Iraq “food for oil” scandal in which Annan and his son-in-law pocketed millions while starving Iraqi children. What a guy and what a joy it is to find out that he’s not unemployed these days but instead has found remunerative work in another scam, the campaign to save polar bears and make Al Gore rich.

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Once they link it to global warming, it’s a shoo in

Oregon Congressman introduces bill mandating GPS trackers on private cars so government can follow and tax us. He proposes allocating a mere $154.5 million to “study” the issue, money which might just happen to go to his campaign donors like Honeywell, though if Jim Murtha is still free when this gets considered, I’m sure there are some Pennsylvania companies who could get their nose in the trough too.

I have a problem with the government knowing where I am and where I’ve been but then, I haven’t bought into the new New Deal yet; your opinion may differ.

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Meadowcroft Lane

Someone asked earlier today about the status of Mark Mariani’s spec houses and I told him that all three: Doverton, Dairy and Meadowcroft were off the market and supposedly being prepared for rental. I was wrong about 1 Meadowcroft – it is still actively for sale and in fact it was reduced just now to $12 million, down from its original asking price of $14.5. So if you were waiting …..

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Slowly I turned, step by step, inch by inch

21 Midwood Drive

21 Midwood Drive

This impressive new house was purchased for around $8.5 million in 2007, dolled up some more and put back up for sale for $16 million in April – a price that did not include, by the way, light fixtures or toilet paper rolls. It dropped a million in August and today it’s been slashed a full $500,000 so it can be yours, sans fixtures, for just $14.5 million.

A price cut of half a million on Havemeyer Lane is impressive; I doubt that a cut of this size in this price range will have the desired effect but if the sellers keep it up, they’ll eventually get out from under this project.

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America taken hostage

A TV journalist named Dylan Ratigan has a post fuming that Wall Street has grabbed hold of the levers of power in Washington and is manipulating them to squeeze us dry. I’m not a populist, but I’m also not in favor of huge industries using huge government to screw the country, so I’m with Ratigan on this one. In fact, it’s very much along the lines of the argument I posted earlier today on restoring the free market. Repeal “too big to fail” and let these clowns survive or die by their own efforts, not ours. While we’re at it, can we get Charlie Rangel to pay his taxes?

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September sales activity

Thirteen single family homes have gone to contract this month. Eleven of those are asking under $2 million and the other two asked, but probably aren’t getting, numbers in the $5s. The areas between $2-5 and $6 and up are dead, so far.

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Baliwick – going for the record

12 Baliwick
12 Baliwick

This house on Baliwick was in excellent shape when sold in 2003 for $2 million, and the buyers have apparently updated and improved it even more. Still, I was surprised when it came up for sale today at $3.297 million because, to my memory, nothing had sold above three million on that street, ever. A check of MLS data confirmed my memory. There was a sale for $2.717, but that was in 2004. And in 2005, another Baliwick home sold for $2.4 million. Since then, things seem to have gone down, not up. Number 8 Baliwick, for instance, sold for $2.075 million in 2007 to buyers who completely renovated it and increased its size 50%, then re-listed it for $3.250 in 2008. It sold for $2 million in 2009.

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More news the New York Times figures you don’t want to know about

ACORN, the black community group that figured so prominently in the last election when it engaged in massive voter-registration fraud, is back in the (non NYT) news again. Seems that someone sent a team of borrowers dressed as a pimp and a Ho to ACORN headquarters and asked for assistance setting up a brothel. ACORN obliged, on tape, then explained the first tape as an isolated example. Well that was in Baltimore. New tapes show the same team trying, and succeeding, in Baltimore and New York. For those of us who know who, and what ACORN is, there’s no surprise here, but when this story finally moves off the Internet and hits the mainstream media, the Times will find itself once again trying to explain a story to its readers that it had previously told them nothing about.

The readers like this protective shield, I suppose, so maybe the Times will muddle through.

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What trade?

Ghost fleet of Singapore. Unneeded cargo ships at anchor.

Shipping at Long Beach California was down 36% this March and hasn’t improved.

As of May, Bloomberg was reporting that banks were hiding billions in losses on real estate and again, I don’t see that that situation has improved – quite the contrary.

So maybe the economy is indeed recovering, maybe these are just little potholes in the road to recovery, but I’m beginning to suspect that we’re being fed a reassuring con-job by the world’s governments and that the media is going along with it.

If you see me in Cos Cob manning a LaRouche table you’ll know that my paranoia has gained complete control. Until then, I’m just cautious.

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Oh, if only I were still sixteen

Put it in reverse and see how that works out

Put it in reverse and see how that works out

I was at the Cos Cob Starbucks over the weekend and watched a Greenwich cop park her car on Strickland and, leaving it running, go into the restaurant there to order food (judging from her girth, I’d say donuts, but …). A great sadness came over me as I realized that the obvious thing to do: hop in the car and hide it behind the Calahan’s Movers building, then sit in the pocket park and watch the fun, wouldn’t be tolerated as a youthful indiscretion now that I’ve reached advanced age. Damn.

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Paging Jacques Cousteau

As we hear that our national economy is recovering because we’re losing fewer jobs these days than we were before, and banks report profits again, it seems a good time to check  and see how many houses in Greenwich were purchased after January 1, 2001 and are therefore “underwater” – worth less today than they were when bought. The sobering answer: 5,541. There are 21,000 single family homes in Greenwich.

Now, not every house purchased in the past eight years is currently for sale, and not every one of them was bought with borrowed money, but if you take this number, adjust it however your fancy suits you, and then add in all those houses whose owners refinanced during the go-go years, you’ll end up with a huge bulk of homes that can’t be sold without some forbearance by the banks or a contribution of new cash by the seller at closing. Perhaps the percentage of under-water homes isn’t as high as 26%, but perhaps, because of those refinancings, it’s greater. Regardless, there is trouble lurking behind the stonewalls of Greenwich and I think it will spill over in the coming years. It’s already begun.

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A free-market advocate looks at the economy, banking and health care

The New York Times Business section ran an article yesterday by a Tyler Cowen, economics professor at George mason University. It’s worth reading in its entirety, but here are some excerpts.

FOR years now, many businesses and individuals in the United States have been relying on the power of government, rather than competition in the marketplace, to increase their wealth. This is politicization of the economy. It made the financial crisis much worse, and the trend is accelerating.

Well before the financial crisis erupted, policy makers treated homeowners as a protected political class and gave mortgage-backed securities privileged regulatory treatment. Furthermore, they allowed and encouraged high leverage and the expectation of bailouts for creditors, which had been practiced numerous times, including the precedent of Long-Term Capital Management in 1998. Without these mistakes, the economy would not have been so invested in leverage and real estate and the financial crisis would have been much milder.

But we are now injecting politics ever more deeply into the American economy, whether it be in finance or in sectors like health care. Not only have we failed to learn from our mistakes, but also we’re repeating them on an ever-larger scale.

Lately the surviving major banks have reported brisk profits, yet in large part this reflects astute politicking and lobbying rather than commercial skill. Much of the competition was cleaned out by bank failures and consolidation, so giants like Goldman Sachs and JPMorgan had an easier time getting back to profits. The Federal Reserve has been lending to banks at near-zero interest rates while paying higher interest on the reserves the banks hold at the Fed. “Too big to fail” policies mean that the large banks can raise money more cheaply because everyone knows they are safe counterparties.

President Dwight D. Eisenhower warned of the birth of a military-industrial complex. Today we have a financial-regulatory complex, and it has meant a consolidation of power and privilege. We’ve created a class of politically protected “too big to fail” institutions, and the current proposals for regulatory reform further cement this notion. Even more worrying, with so many explicit and implicit financial guarantees, we are courting a bigger financial crisis the next time something major goes wrong.

We should stop using political favors as a means of managing an economic sector. Unfortunately, though, recent experience with health care reform shows we are moving in the opposite direction and not heeding the basic lessons of the financial crisis. Finance and health care are two separate issues, of course, but in both cases we’re making the common mistake of digging in durable political protections for special interest groups.

One disturbing portent came over the summer when it was reported that the Obama administration had promised deals to doctors and to pharmaceutical companies under the condition that they publicly support health care reform. That’s another example of creating favored beneficiaries through politics.

If these initial deals are falling apart, it is only because reform met with unexpected resistance. Even after Mr. Obama’s speech Wednesday night, we’re still at the point where the medical sector is enshrined as “too big to take a pay cut,” which is not so far removed from the banking motto of “too big to fail.” In finance and health care, a common political dynamic has created similar trends, namely, out-of-control costs, weak accountability, and the use of immediate revenue patches to postpone dealing with fundamental problems.

Even worse, these political deals threaten open discourse. The dealmaking may be inhibiting some people in health care from speaking out in opposition to the administration’s proposals. Robert Reich, who served as secretary of labor in the Clinton administration, deserves credit for complaining about this arrangement, but not enough people are asking where such dealmaking might stop.

[snip] So if we’re looking for a major lesson from our banking mess, it is undoubtedly this: We have made a grave mistake in politicizing the economy so deeply, and should back away now. In health care, the Obama administration should drop its medical sector deals and try to sell a reform plan — in whatever form Mr. Obama chooses — on its own merits. That’s not only good for health care, but also good for the American polity.

Tyler Cowen is a professor of economics at George Mason University.

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It’s a religion of peace

Or, “get off it, all morality is relative.” Indonesia passes law reaffirming that adulterers will be stoned to death, homosexuals imprisoned. As long as they also hate the US, we won’t be hearing about this from Oliver Stone or Michael Moore.

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Price cuts

I won’t vouch for these new prices but at least the owners are getting serious. 142 Cat Rock, a really nice house, in my opinion, was purchased for $4,050,000 in 2005 and is marked down today to $2.995 million. There has to be some value there, don’t you think?

8 Sherwood Lane is not particularly appealing to my taste, but it has dropped from $5.8 million in 2007 to $3.8 today.

And then, just to prove that we still have stubborn sellers among us, 4 Old Camp Lane makes its return today, at $1.975 muillion. Each year, beginning in 2006, this house has appeared on the market. It asked $2.345 back then and, at least to my mind, its new price is not significantly different.

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Will the fall selling season start this week?

There’s a lot of buzz about deals these days, so we may start seeing some activity. So far, we’re seeing sales, but at huge discounts like Boulder Brook, asking $7.3, getting (rumor has it $4.3). The market may have finally reset, in which case we will see sales again. On the other hand, we’re not seeing many new listings coming on and, when they do, it’s as though sellers and agents are still living in 2007. If that keeps up, don’t expect much activity.

So Labor Day is behind us, and we should see a flood of new listings and houses returning to the market. We’ll know by the end of this week, I think, whether we’re in for another six months of doldrums or not. I’ll keep you posted.

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