The financial crisis killed small entrepreneurs as surely as Joseph Stalin killed the kulaks, and the roots of the economy are dead and dry.
Spengler Fisks the labor statistics.
(You know things are really bad when the “good” news is that banks are adding clerical staff to process all the mortgage foreclosures.)
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We are so boned.
I was listening to an investment radio show Saturday by Charles Payne. He had several calls from listeners on the foreclosure topic. One caller had attempted to renegotiate his mortgage terms with the bank and was turned down because he was still current in his payments. The Obama plan only applies to those who are delinquent. So, the caller stopped making payments. It has been 11 months and he has received no communication from the bank about it. Apparently, they are too busy to deal with him.
Another caller was renting a house that went to foreclosure. The owner walked away and informed the renter that he was no longer the owner. The renter stopped making rental payments and contacted the bank, making a cash offer to buy the house. He never got an answer. He is still living there and paying no rent. Payne commented that at least the former owner was honest enough to tell him to stop paying him.
Someone else called to say they had a friend who bought a foreclosed home for $100,000 cash from the bank. The house had previously sold in the 500K range.
These people cannot even mange the properties they hold notes on.
On a similar note, if you get foreclosed on, fight it, don’t move out, don’t go along with it, don’t make it easy for them. The banks are so overworked, they will likely just toss your file in the corner and go after easierr pickins’. If not, you have not lost anything.
Based on anecdotes, my sense is that in some cases banks are holding foreclosed properties rather than sell them and book the losses.
“don’t move out, don’t go along with it, don’t make it easy for them. The banks are so overworked, they will likely just toss your file in the corner”
When the financial ballon goes up and bursts it seems that debtors usually make out comparatively better (think post war Germany, Argentina, etc). I gotta go out and blow it all.
Before he revealed his identity and went to First Things, Goldman wrote a piece suggesting that China would become Christian. The argument was based on compounding an estimate of contemporary conversion rates. I lost considerable respect for him when I realized that he had a potential ideological bias which he did not reveal.
Back in the day, iirc, Goldman also wrote that an Obama presidency was out of the question.
This doesn’t mean that Goldman is stupid or evil. It just means that I no longer seek him out.
And hopefully it means that his opinion about unemployment is a contrary indicator.
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