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At Some Point In The Not-Too-Distant Future, Banks Will Need To Recoup At Least Some Of What They’ve Lent

A report from Bloomberg. “The market for mortgage-backed securities was in free fall, with fear running rampant and banks seizing collateral. That was last Saturday. In the week since, three top investors in the sector have engaged restructuring advisers, two others sold $7 billion of debt at a discount and publicly traded mortgage REITs in the U.S. lost more than $12 billion of market value, bringing total declines this year to at least $50 billion.”

“The carnage shows no signs of abating. Prominent asset managers including Blackstone Group Inc., TPG and Apollo Global Management Inc. have been sucked into the vortex wrought by the coronavirus pandemic, with their associated mortgage REITs losing more than two-thirds of their value on average so far in 2020. Investors are fleeing from residential and commercial debt that isn’t backstopped by the federal government.”

“In the past month, five mortgage REITs have notified investors that they’ve been unable to meet margin calls and started discussing forbearance agreements with their lenders. Other REITs have canceled, delayed or modified dividends, or liquidated riskier parts of their portfolios. While private funds also use leverage, they often have access to liquidity through capital calls, giving them more flexibility than their publicly traded peers. But they aren’t necessarily immune. Their problems may just be less apparent because of more relaxed disclosure requirements.”

“‘There are a lot more mortgage funds and real estate funds than mortgage REITs,’ said Eric Reilly, a partner in Mayer Brown’s banking and finance group. ‘There’s probably a couple of funds out there in some form of distress for every mortgage REIT you see.'”

From Mortgage News Daily. “A homeowner who qualified for a $1,075/month mortgage payment on March 5 would have qualified to purchase the average-priced U.S. home of $313,000 with 20 percent down. Less than two weeks later on March 19, MortgageNewsDaily said the rate had reached 4.15 percent. With that rate, the same homeowner would have only qualified for a $276,800 home purchase – more than a $36,000 reduction in buying power over a two-week span.”

“Rates have since lowered, Mortgage News Daily put the March 23 rate at 3.44 percent, but the situation remains incredibly volatile. Many potential homebuyers are likely left wondering what their true buying power is on a daily basis, and whether that will have changed by the time an offer is accepted and they’re ready to lock in their rate.”

From Mortgage Professional America. “On April 1, Attom Data Solutions released its February 2020 U.S. Foreclosure Market Report. Any figures related to the housing market – or any market, for that matter – that were collected prior to the pandemic need to be taken with a U-Haul’s worth of salt. MPA: How different do you think the numbers will be in the next few months?”

“Todd Teta, CPO, Attom Data Solutions: Now we get to the part where we say everything is in flux because of the potential impact of the coronavirus pandemic. On the upside, the next few months may actually see another drop in foreclosures because banks have pledged to temporarily hold off on going after homeowners who fall behind on their mortgages. But how long that will last is unknown. Millions of people have lost jobs or work hours, which can only hurt their chances of staying current on their mortgages. At some point in the not-too-distant future, banks will move forward with foreclosure proceedings on delinquent homeowners because they will need to recoup at least some of what they’ve lent.”

From Market Place. “As a mortgage broker in Portland, Oregon, Steph Noble usually gets calls from people trying to get a new loan or refinance an existing one. These days, she’s hearing from a lot of former clients looking for help figuring out how to delay their mortgage payments due to a job loss or reduced income. ‘It’s two things: People who need immediate help, and then people who want to plan,’ she said. ‘They have enough to carry them through a period of time, but they’re just not sure how long this can go on for them.'”

“Under the recently passed Coronavirus Aid, Relief, and Economic Security Act, homeowners with federally backed mortgages, such as those guaranteed by Fannie Mae and Freddie Mac, the Federal Housing Administration or Department of Veterans Affairs, can pause or reduce their payments for up to a year. But Noble said some servicers are requiring a balloon payment at the end of that period. ‘If you don’t have $1,500 for three months, what’s the likelihood you’re going to have, magically, $4,500 at the end of three months?’ she said.”

“Researchers at Black Knight Inc. looked at the correlation between unemployment and missed payments during the Great Recession. If unemployment hits 10%, director of market research Andy Walden said, ‘we could be looking at roughly 2 million homeowners becoming past due on their mortgage in coming weeks.’ At 30% unemployment, that projection rises to 10 million borrowers.”

“Guy Cecala, publisher of Inside Mortgage Finance, said nonbanks, like Quicken and Loan Depot, now have a much bigger share of the mortgage market, accounting for more than half of originations and about a third of mortgage servicing. Mortgage servicers collect payments from borrowers and pass the money on to investors in mortgage-backed securities.”

“‘The nonbanks, needless to say, don’t have the same financial wherewithal that a bank does,’ Cecala said. ‘So they’re certainly more challenged if they have to advance payments to investors on mortgage securities, particularly if it goes more than a month or two, which seems very likely at this point.'”

From National Interest. “While the government has been proactive in protecting any borrowers, who pay their mortgage through a federal loan—i.e. a majority of mortgage holders—a large minority of mortgage holders have been left with whatever private banks are willing to offer. Some banks are offering forbearance options, similar to the government, while others are only offering reduced transaction fees on a temporary basis.”

“This disparity in the reaction between policymakers and bankers has put private companies that process mortgage payments in a difficult position. Many homeowners are expecting the same relief and understanding of their difficult situation that the government is providing. Some borrowers are now declining to make payments for the duration of the crisis.”

“The primary problem remains that few of the private banks have enough liquidity to withstand the widespread suspension of mortgage payments.”

The La Jolla Light in California. “Jeff Tucker, an economist with Zillow, said lenders have been overwhelmed by applications, which are almost entirely driven by refinances. He said they have responded by not advertising and even raising rates. He said mortgage lenders could have raised rates either because they were trying to slow down the flow of customers or they were trying to make a loan that would actually be worth their while. ‘Rather than burning the midnight oil, they began quoting higher and higher rates for all the folks rushing in the door,’ he said.”

“Matthew Shaver, a San Diego senior mortgage consultant with Finance of America, said the changes in rates have happened so quickly he doubts buyers could keep up. ‘Rates changed so quickly that people don’t know,’ he said. ‘They don’t get daily reports. Media will get reports at the end of a week that says rates are at an all-time low. But, two days later they have actually gone up 1 percent.'”

“Mark Goldman, a San Diego real estate analyst and loan officer with C2 Financial Group, said closing a loan can be stressful for a lender in today’s environment. He said lenders must verify employment, but if the person is laid off after locking in a new loan, it gets canceled. Also, he said a lot of times a borrower can be counting on rental income but that can go away quickly with possible tenants losing work.”

“Goldman said another concern is that mortgage servicers, companies that collect monthly mortgage payments, still have to pay investors even if borrowers are granted forbearance on loans. The Mortgage Bankers Association has written a letter, according to CNBC, to the Federal Reserve chairman requesting relief for servicers who could go bankrupt if too many Americans aren’t making payments.”

The Review Journal in Nevada. “When Las Vegas’ real estate market crashed more than a decade ago, job losses soared, and lenders foreclosed on homes all over the valley. Today, the economy is in crisis again because of the coronavirus pandemic — but foreclosures are on pause, stopping what could have been an avalanche of repos. Despite the intervention, Las Vegas’ housing market is not in the clear. It’s still unknown how long businesses will remain closed, how fast they will staff up when the virus is no longer a threat and how many employers end up shuttered for good because of the outbreak.”

“So far, the fallout from the virus has been swift. Around 71,940 initial unemployment insurance claims were filed statewide in the week ending March 28, second-highest in Nevada history behind the prior week’s record of nearly 92,300, according to the Nevada Department of Employment, Training and Rehabilitation. Before the outbreak, the weekly record was 8,945 claims in January 2009 after the housing market crashed.”

“We will find out soon enough whether the outbreak’s aftershocks spark a foreclosure crisis in Las Vegas. But the valley does not want a repeat of the dark days from a decade or so ago when masses of homes emptied after the housing bubble burst, enabling a widespread squatter problem even as the market rebounded in later years.”

This Post Has 121 Comments
  1. ‘they have responded by not advertising and even raising rates. He said mortgage lenders could have raised rates either because they were trying to slow down the flow of customers or they were trying to make a loan that would actually be worth their while. ‘Rather than burning the midnight oil, they began quoting higher and higher rates for all the folks rushing in the door’

    And just not returning phone calls, I’ve read.

    I’ve received emails asking about foreclosures. What I’ve seen is a lot of auctions getting pushed out into May. In Arizona they just made it possible to bid online for courthouse sales (pre-foreclosure), which I didn’t think was legal, but they did it. It appears to be go-time. The crappy loans were already piling up in January. It’s time to start thinking about what you want to do, and what you want to do when you get there. Please stay in touch with me to discuss this rapidly changing situation.

  2. ‘they will need to recoup at least some of what they’ve lent’

    One thing that started at the end of last year: lenders were accepting less than they were owed at auctions. That is blood on the streets, and I expect it to increase.

  3. ‘Noble said some servicers are requiring a balloon payment at the end of that period. ‘If you don’t have $1,500 for three months, what’s the likelihood you’re going to have, magically, $4,500 at the end of three months?’

    This is the second time in a couple of days I’ve read about these balloon payments.

    1. Yeah, this isn’t like the automatic 6 month student loan forbearance where no unpaid interest is accrued.

      1. “no unpaid interest is accrued.”

        If this were made permanent, I wouldn’t disagree with it. Students still need to pay back the debt, but at least over time the balance will get smaller and not bigger. It’s probably something President Biden will do right away.

        1. haha they had 8 years under him and the anointed one and not a word….not even an attempt to stop it.

      2. “…where no unpaid interest is accrued.”

        Picking nits here, but interest is calculated on the principal balance at the moment a payment is submitted, and that interest is subtracted from the payment with the difference applied to the principal reduction.

        When I was a student loan debtor the government paid the interest on my expanding loan balance to the bank(s) holding my loans. When I graduated and entered the workforce I was responsible for principal and interest on the balance due. The government was still on the hook if couldn’t handle the 40-hr weeks and decided to drop acid and contemplate my navel.

        1. The student loan is an installment loan with a defined period, so if no payment submitted then interest is computed for that period and it is added to the unpaid balance. I opted for the longest repayment period with the smallest payments possible just in case I ran into trouble. Then I always submitted large payments to reduce the principal balance quickly.

          1. if no payment submitted “…then interest is computed for that period and it is added to the unpaid balance.”

            Dumb question of the day: Will interest continue accruing during the coronacrisis student loan forbearance period?

          2. According to the government website, interest is reduced to 0% during the forbearance period.

            So, I wonder, if one were to make payments anyway during this period, will all the payment be applied to principal?

          3. “Dumb question of the day: Will interest continue accruing during the coronacrisis student loan forbearance period?”

            My best guess, Yes. The government will pay the interest to the bank(s) holding the loans if the student borrowers cannot or will not make their payments.

          4. “So, I wonder, if one were to make payments anyway during this period, will all the payment be applied to principal?”

            I wouldn’t bet on that, as evidence of hardship (e.g. inability to make payments) could be used as a bailout criterion.

          5. “…if the student borrowers cannot or will not make their payments.”

            Could the criterion depend upon ability to pay but not on willingness? It seems like huge moral hazard and fairness concerns could arise if they made this discretionary.

          6. Could the criterion depend upon ability to pay but not on willingness?

            Your payments will automatically stop from March 13, 2020, through Sept. 30, 2020.

            To provide relief to student loan borrowers during the COVID-19 national emergency, federal student loan borrowers are automatically being placed in an administrative forbearance, which allows you to temporarily stop making your monthly loan payment. This suspension of payments will last until Sept. 30, 2020, but you can still make payments if you choose. Read the borrower Q&As below to learn more.

            UPDATED: Interest is being temporarily set at 0% on federal student loans. Which loans does the 0% rate apply to?

            From March 13, 2020, through Sept. 30, 2020, the interest rate is 0% on the following types of federal student loans owned by ED:

            Defaulted and nondefaulted Direct Loans
            Defaulted and nondefaulted FFEL Program loans
            Federal Perkins Loans

            Please note that some FFEL Program loans are owned by commercial lenders, and some Perkins Loans are owned by the institution you attended. These loans are not eligible for this benefit at this time.

    2. Balloons
      I got a new job a few years ago and was surprised that they held a fair number of balloons. ( not related to DQ ). Prior employers didn’t do balloons.

  4. Lots of “longstanding” financial issues may be brought to a head in the next few months.

    Bank in West Virginia is closed by regulators
    By Brendan Pedersen
    April 03, 2020, 5:17 p.m. EDT

    A West Virginia bank was closed by its state regulator Friday afternoon in the industry’s second failure of 2020.

    The Federal Deposit Insurance Corp. was appointed receiver for First State Bank in Barboursville. The bank and all four of its branches were assumed by the $1.9 billion-asset MVB Financial in Fairmont, W.Va.

    MVB disclosed in a regulatory filing that it paid no premium for the deposits. It bought the branches for about $1.5 million.

    First State, with $152.4 million in assets and $139.5 million in deposits, had struggled for several years. Its capital levels fell below legal limits under state and federal law after the fourth quarter, the FDIC said.

    Agency officials said the failure was not connected to the recent economic shocks from the spread of the coronavirus. “This bank failure was not a result of the current health emergency,” the FDIC said on Twitter Friday. “Financial issues were longstanding.”

    1. Getting Closed banks Assets

      I am thinking dealing with the Fed when taking over “ dead” bank’s assets will be A LOT Tougher (Stronger guarantees for the acquiring bank) this go around.
      Too say the Government/Fed didn’t always play fair would be an understatement.
      Example
      We did the best effort on collecting this loan but it went belly up anyway. You owe us.

      Fed You didn’t handle it correctly. We aren’t paying you. Eat the loss!

      Heard that scenario from several different people at several different banks .

    2. “Financial i$$ues were long$tanding.”

      Certainly, most likely had nothin’ to do with aq.dannyboy’$ “coal.is.black.gold!” belief$.

  5. “Less than two weeks later on March 19, MortgageNewsDaily said the rate had reached 4.15 percent.”

    Shockingly high! I’ve never seen a rate that high before!

    Really, this shows where we are. There is so much debt in the economy that any interest at all is enough to collapse the house of cards.

    Just remember, the “global savings glut” with unlimited borrowing at low rates for everyone would have been inconceivable before 1995. That’s the only era anyone remembers, it seems.

    We bought our house in 1994. We were thrilled to get in under 10 percent.

    This virus might lead to the sources of the global savings glut to seek to call their savings home, because they need it. Sorry, but we spent it!

    1. I kind of doubt it as there is no real glut. It’s just accounting tricks played by the Asian economies to prop up the dollar so we’ll buy stuff made in their factories. So the “glut” such as it is, is political, not economic.

      1. Who’s going to trust China now? Right now they’re buying Cuomo’s good will with a few ventilators, and unfortunately it might work. Americans have short memories.

        1. China will continue to be a major factor in our supply chains, but hopefully we will reappraise our critical needs and keep these industries closer to home. Companies like Amazon and Walmart can manage (rotate) stockpiles with the government paying a subsidy for the benefit cost much like airline route subsidies. We already have the infrastructure and know-how in place; ameliorating the expense is the issue.

          1. Perhaps we could look into continuing to buy cheap Chinese-made crap, to keep the Walmart shoppers happy, but insource critical infrastructure production at home? Just a thought…

          2. “…buy cheap Chinese-made crap…”

            China is capable of producing any quality the contractor desires, and it is up to the contractor to QAQC samples from the production line.

          3. I don’t know, but QAQC is normally a responsibility of the contracting party. Walmart sells what the customers are buying.

          4. My point is that as long as Walmart customers are happy to buy cheap crap, why would anyone at any upstream point on the supply chain squeeze profits by wasting $$$ on QAQC?

  6. “…publicly traded mortgage REITs in the U.S. lost more than $12 billion of market value, bringing total declines this year to at least $50 billion.”

    Is $50 billion alot? What’s that as a percentage of the initial value of publicly traded REITs before COVID-19?

    1. Is $50 billion alot?

      Isn’t that what a couple of brand new “world class” airports cost these days?

  7. Under the recently passed Coronavirus Aid, Relief, and Economic Security Act, homeowners with federally backed mortgages, such as those guaranteed by Fannie Mae and Freddie Mac, the Federal Housing Administration or Department of Veterans Affairs, can pause or reduce their payments for up to a year. But Noble said some servicers are requiring a balloon payment at the end of that period. ‘If you don’t have $1,500 for three months, what’s the likelihood you’re going to have, magically, $4,500 at the end of three months?’ she said.

    All of this stuff is nonsense. Better off just to let the market work. In the long run, everybody would be better off.

    1. “Better off just to let the market work. In the long run, everybody would be better off.”

      Are you sure everybody would be better off? Certainly some people who are making a killing right now will feel the ‘bern.

  8. Published 2/14/2020 authored by James Howard Kunstler:

    “What if the Corona virus turns out to be a genuine pandemic with legs, not some punk-ass, flash-in-the-pan bug like SARS… and infects hundreds of millions around the world…? And what if it happens to go logarithmic in the USA, as in China now…? And what if takes a few months, or half a year, to do that…? And what if Americans will not get on airplanes when that happens…? Or gather together in large numbers…? Or if government imposes quarantines …? Will the parties hold their nominating conventions? Might the November election have to be postponed?

    Just sayin’… since nobody else seems to be talking about it. A few months ago, nobody was thinking about a disease that would virtually lock-down China’s economy, either… and now here we are. Speaking of which, that lock-down of China’s economy is already generating serious damage to global GDP, after only a few weeks. But nothing shows our detachment from reality like the recent surge in financial market indexes while the Chinese economy was busy shutting down. In particular, one must wonder: What supports the global daisy-chain of debt obligations while all this is going on?

    After all, companies doing business need a revenue stream to service their revolving debts. They have to make stuff, and move stuff, and get paid for it. What happens when there is no revenue stream? The workings of this hyper-complex financial system depend utterly on the velocity of these revenue streams. They can’t just… stop!”

    https://kunstler.com/clusterfuck-nation/impure-thoughts/

    1. They can’t just… stop!

      Obviously they very well can. The question is the cost. So far, the virus effect is a rounding error in the population, if it indeed has increased the overall death rate at all. That could change by several orders of magnitude, right? Not so much if it fizzles out in a week and a half. We’ll find out together.

      In any case, we will be working very hard for a long time to adjust to a lower standard of living and to help keep scores of millions of out of work neighbors from getting quite hungry.

    2. Looks like some of pharma is feeling left out:

      ———————–
      “US biotech firm donating 1.5 million doses of experimental coronavirus drug

      Gilead Sciences Inc, a U.S. biotechnology firm that develops and commercializes drugs, has rapidly expanded its supply of an experimental coronavirus drug and is prepared to donate 1.5 million doses of it to hospitals dealing with severely ill patients.

      Gilead CEO Daniel O’Day said in a statement on Saturday that the 1.5 million doses of the drug, known as remdesivir, could be part of treatments courses for as many as 140,000 patients. ”
      —————

      Heh, they don’t want that pesky hydroxychloroquine to steal their thunder.

      1. “hydroxychloroquine”

        That’s a rhetorical placeholder for whatever cure is eventually found.

  9. About to face covid-panicked shoppers, sans mask. It may be my last chance before the next governor’s order requires them.

    1. Standing in line for 1/2 hour trying not to breathe in my fellow shoppers’ exhalations while waiting to get into the appropriately socially distanced grocery store. It’s a huge store which is normally quite empty even without a Soviet-era breadline outside.

      1. Now in my second grocery store entry line of the afternoon. A majority of my fellow shoppers are wearing masks. I can tell from the fearful looks in their eyes that they have on those masks to protect themselves, not others.

        1. And it’s suddenly turned freezing outside, by San Diego standards. If I catch COVID-19 while standing outside in the cold with other humans, can I sue the store?

          1. Even in my neck of the woods, the grocer’s online queue is full and getting an order placed can be tricky. And we don’t have lines to get into the store. I went to Safeway yesterday evening, and it was deserted, the parking lot was almost empty. For kicks, I looked down the TP aisle, and I saw an few lonely 4 packs on the shelves.

        2. “I can tell from the fearful looks in their eyes that they have on those masks to protect themselves, not others.”

          Are you implying that “self interest” is prevalent in The Socialist Republic of Kalifornia?

        3. “protect themselves, not others“

          I was getting that feeling during my last costco trip. I felt like the mask mafia were giving me dirty looks for not participating. Costco likes to move things around to different isles so i had a couple non masked conversations with the workers but all the other shoppers definitely kept their distance from me.

          Btw, Got a good laugh reading your shopping experience 🙂

          1. A buddy of mine had to step in to protect an Asian family from some ignorant shithead who decided they personally were responsible for the outbreak of Coronavirus in Colorado. Wish I would’ve been there. The first fight I was ever in was kicking some schoolyard bully’s ass after he wouldn’t stop tormenting this Jehovah’s Witness kid who wouldn’t (and couldn’t) stand up for the pledge of allegiance. My buddy was hoping the weasel would throw a punch, but instead he just scurried away like the punk ass bitch that he was.

          2. Amazing how quick things change. On March 21, the last time I walked into a store (Wal-mart in West Virginia), I was the only one in a mask. I saw a lot of buying but not a lot of fear. Now people are finally figuring it out.

            The coronavirus model charts predict that this wave will taper off by June 7 in my state. I easily have enough food to last until then, and I’ll feel safer shopping.

            I highly recommend going to this page and reading the FAQs. Main message: if we maintain full social distancing, the first wave of this disease will taper off by the end of July. At that point, 97% of the population are still susceptible. If there is a second wave, we would go back to mass testing and social distancing.

            (This is why I recommend everyone keep six weeks of good food on hand in case there’s a sudden local lockdown, especially in early fall.)

          3. “ This is why I recommend everyone keep six weeks of good food on hand in case there’s a sudden local lockdown”

            Good advise Oxi. Hard for me to gauge how much i would need for a 6 week stash as my family started eating everything we have like its going to be their last meal. My kids have become rabid animals during this lockdown and i have found food shopping has become more frequent. Of course, all the canned and frozen food (that they rarely consume) has been stocked up. They are “snackers” i guess. I can also say we ate out often so thats a leading cause to the increased shopping. We also started back up on a weekly local fruit/veggie delivery which has been helpful but I suppose that would go away if a more strict lockdown took place.

          4. “Got a good laugh reading your shopping experience”

            Thank you. I’m doing my best to find the humor of this situation and share it.

            I think I may be the main shopper for the household from here until the end of the Stay at Home order, despite my tendency to purchase alcohol which my wife doesn’t drink, as the shopping experience has become more hunter than gatherer in recent days.

          5. “Main message: if we maintain full social distancing, the first wave of this disease will taper off by the end of July. At that point, 97% of the population are still susceptible.”

            Four more months of lockdown would be very difficult for everyone. How are the Chinese going about their business already just a couple of months since peak crisis (or so I’ve been told)?

  10. I’ve been browsing new listings a bit this afternoon. Seems everything coming to market is priced at the peak and beyond. I find it funny that people think this is actually a strategy that would work at this time. You never get a 2nd chance to make a first impression.

    Overpricing is the death knell for selling anything as it serves to turn off a vast majority who won’t be interested at any price in the future after the seller has revealed themselves to be a greedhead.

    1. You can list at whatever price you want, but may never attract a buyer in the current environment without major reductions from your wishing price.

      1. without major reductions

        The $150K reduction isn’t helping the time-warp Encinitas Highlands property. It also looks like another fixer-upper property will be joining the neighborhood listings; two moving boxes in a driveway.

          1. When I think Encinitas, I think west of I-5, not east of El Camino Real (yeah, I know, technically it’s Encinitas)

    2. Remind me what area your in headlessbankers? I see the same peak list pricing up in the bay area and looking down in SD county is the same but 216 new listings in the last 24 hours. Im told my data source may not be 100% accurate but Im sure its close. Up here the uhs like to list on tuesdays, guess down there its a 24/7 real estate casino

      1. I’d be curious to see photos from the 2016 sale. These photos show trendy garage and closet doors as well as quartz countertops. It looks like it may have had an extensive and expensive remodel but not enough to justify the $1M over the last sale price.

    1. Got that for free when I bought my slightly used truck last summer. When you let it lapse, expect to find the breakup lengthy with incremental stages of begging. I believe their last offer was something like $2/mo.

  11. The irony is that by making the shopping process more painful, stores are killing demand and reducing sales, thereby contributing to the economic slowdown. And all told, the dearth of customers in the store and short waiting lines at checkout largely offset the time cost of waiting outside. I still question the social distancing wisdom of making 25 or more customers wait outside in close proximity for the chance to shop without another customer within 50 feet until checkout time.

    1. To quote another HBBer “we’re flying by the seat of our collective pants.”

    2. nd all told, the dearth of customers in the store and short waiting lines at checkout largely offset the time cost of waiting outside.

      What is this “waiting outside” thing? When I last visited the grocery store and Sam’s Club a few days ago, I just walked in. Neither were busy or crowded.

      TP is still hit and miss, but we have about 40 rolls, so no worries.

        1. Point taken. It was a wife request, sort of an offer I couldn’t refuse. Next time I go will try going near opening time.

          1. You bring up a good point, which is that waiting outside BigBoxMart at opening time to avoid the crowds may backfire if a huge crowd is waiting outside at opening time to get in. With stores that remain open reducing their hours and most other (“nonessential”) stores closed, this is a likely problem, as more shopping demand is concentrated on less time, and the “up early” penalty is not relevant if the store doesn’t open early.

      1. The managers of our local grocery chains had this brilliant idea of only allowing a very small number of shoppers inside their stores and forcing the rest to wait outside for 1/2 an hour before entering. It started with Costco, then the contagion spread to Trader Joe’s, Ralph’s, and now even Sprouts. Maybe I’m missing it, but it seems like the chance to catch the virus would go up with a longer exposure time standing around outside near an asymptomatic case than if I could get in and out of the store in 10 minutes to buy toilet paper and a couple of other items (my normal shopping experience). A trip that should have taken me 45 minutes today lasted 2 hours, with much more prolonged social proximity to anxious people standing around in the cold while avoiding any form of social interaction than I wanted.

        1. What you’re missing is that the store is more likely to be sued for the social distance IN the store. What happens in the parking lot is your own fault.

          1. Not missing that at all. In fact, I griped to the store employees who were in charge of gatekeeping that they were increasing the COVID-19 transmission risk by making us stand in line outside instead of quickly taking care of our business inside. (They said they were just following the CEO’s orders.)

            If 1 in 14 San Diegans are testing positive for COVID-19, then there is a pretty good chance that someone in a line of 50 people have it. Have any of the researchers who are trying to force us all to wear masks considered the exposure time factor in transmission risk? I’d guess a 40 minutes visit to the store with 30 minutes wait time and 10 minutes shopping roughly quadruples the transmission risk compared to 10 minutes of shopping, sans wait. But I don’t have the data to test this.

  12. Just put gas in the tank for the first time since the Stay at Home order began over two weeks ago. Only needed 1/2 a tank, and paid $2.49/gallon…not bad by California standards.

        1. Maybe white collar crime will keep trending in the right direction. The old fashioned kind, I’m not so optimistic.

  13. Chappaqua, NY Housing Prices Crater 15% YOY As One Tri-State Broker Said, “Dump Your House For Whatever It Fetches Because It’s Going To Be Much Less Later.”

    https://www.movoto.com/chappaqua-ny/market-trends/

    “Why buy a house when you can rent one for half the monthly cost… Buy it later after prices crater for 70% less.”

      1. Bradenton/Manatee is the poor step child of Sarasota county. At one time a sleepy fishing town and a retirement spot for the working blue collar and lower end white collar. Now it is a deteriorated mess. Angry whites mixed in with clannish Mexicans. Terrible roads, brackish tasting water out of the tap, sewers built in the 1950’s ready to collapse, traffic that is truly a nightmare, increasing auto pollution, sub par medical facilities, failing schools and 89 degrees becoming the daily average. Strip malls and huge car dealerships, roads that have few if any street lights. I could go on…

    1. Snazzy new front door. Interesting they only show pictures of the painfully narrow kitchenette. Some young couple with a family income of $30K would be very happy to buy this for $40K, I guess. It is quite ugly compared to the starter home I “bought” with my spouse back in the day.

    2. Plus the walkabilty is ZERO. absolutely nothing you can walk to that’s anywhere close not even a bus line.

  14. “As a mortgage broker in Portland, Oregon, Steph Noble usually gets calls from people trying to get a new loan or refinance an existing one. These days, she’s hearing from a lot of former clients looking for help figuring out how to delay their mortgage payments due to a job loss or reduced income. ‘It’s two things: People who need immediate help, and then people who want to plan,’ she said. ‘They have enough to carry them through a period of time, but they’re just not sure how long this can go on for them.’”

    Just tell her what you told Caitlyn:
    “You just got to roll with it.”

    1. zilldow has been pissing me off lately as they are lagging on closing reports (mabye layed off the analytics team?). I find myself checking either public records or using movato. This one looks like a deadbeat loan buyer who never made a payment. Part of the banks shadow inventory.

  15. Never believe the outcome of a beauty contest where the contestants pay, and have the power to fire, the judges.

    1. The Financial Times
      Capital markets
      Rating agencies brace for backlash after rash of downgrades
      Critics claim S&P, Moody’s and Fitch might be poised for rerun of 2008 financial crisis
      Agencies say they are simply reacting to changed circumstances, reflecting sudden strains that have emerged as a result of the coronavirus outbreak © FT montage; Bloomberg
      Patrick Temple-West in Tampa April 2, 2020

      Credit rating agencies are scrambling to adjust to the coronavirus pandemic, slashing assessments of vulnerable companies under the scrutiny of critics who blame them for exacerbating the last financial crisis.

      The agencies — led by the big three of S&P Global, Moody’s and Fitch — have pushed through large amounts of rating downgrades as the Covid-19 outbreak has accelerated. March had the fastest pace of downgrades, on records going back to at least 2002, according to a report last week from Bank of America. The bank added that more issuers could expect to have their ratings docked in the weeks ahead.

      To critics, this is a rerun of the 2008 financial crisis, when ratings that were set too high came tumbling down, magnifying a sense of alarm, particularly in markets for securitised products that were packed with mortgage-backed bonds.

      “Here we are, déjà vu all over again,” said Dennis Kelleher, head of Better Markets, a consumer advocacy group. Ratings are being cut “after what appears to be . . . significant ratings inflation, also just like last time”, he said.

      Agencies say they are simply reacting to changed circumstances, reflecting sudden strains that have emerged as a result of the coronavirus outbreak. “We are really just trying to call it as we see it, being balanced, but also acknowledging that this is a very big stress that the economy is facing,” said Craig Parmelee, global head of practices at S&P.
      Covid-19 crisis sparks record US company downgrades

      About 80 per cent of S&P’s ratings actions since early February — about 213 downgrades out of 4,000 rated non-financial companies — have been on issuers already in “junk” territory before the coronavirus crisis, the company noted.

      “We are taking a considered approach to downgrades across geographies and asset classes,” said Anne Van Praagh, head of Moody’s credit strategy and research. “Our job is not to move all ratings down; that does not serve anybody. Our job is to identify the outliers.”

      Concerns that ratings were set too high before the coronavirus outbreak stem from the business models of the agencies, which are paid by the companies and the governments whose creditworthiness they assess. A rating from a top agency can make the sale of a bond or a loan much easier, providing investors with notionally independent views of the borrower’s prospects. Such views are also hard-wired into the mandates under which many fund managers operate, forcing them to sell bonds if ratings drop below certain thresholds.

      But issuers generally pay to be rated — a structure that can cause conflicts, leading to accusations that agencies compete to win business by offering high ratings.

  16. Eye’$ miss Good.ol’.Jack … darn.

    Inve$ting
    Vanguard blew away the competition in Q1, fund flow$ data show

    Published: April 4, 2020
    By Andrea Riquier

    Investor$ flocked to the low-co$t ETF provider in the first few months of 2020

    COMPANY FLOW
    Vanguard 48,539,052,187
    Blackrock 10,068,581,279
    ProShares 6,671,233,889
    Charles Schwab 5,938,401,000
    Rafferty Asset 4,769,158,010
    World Gold 4,262,691,510
    Concierge Tech 2,878,676,302
    Citi 939,203,144
    Goldman Sachs 858,715,650
    Innovator 788,279,478
    VanEck (632,982,896)
    Deutsche Ban. (989,417,442)
    Credit Suisse (1,211,195,262)
    WisdomTree (1,247,189,378)

  17. Colorado Restaurant Layoff, Closure Stats Paint a Grim Picture for the Future:

    “Based on the CRA survey with 256 respondents statewide, 80 percent of restaurants have laid off workers, with 63 percent of those laying off more than 70 percent of their staff. For an industry that employs 294,000 people statewide—nearly 10 percent of our total employment—the impact is significant. The CRA estimates that of the 235,000 people employed in food and beverage establishments, more than 150,000 have been laid off or furloughed.”

    https://www.5280.com/2020/04/colorado-restaurant-layoff-closure-stats-paint-a-grim-picture-for-the-future/

    Councilman Clark: Losing micro businesses on Broadway would be “soul crushing”

    “There are lots of people yelling at us right now about rent freezes and mortgage freezes and we are desperately working around the clock to find ways to what can a local government do during a global disaster,” he said.

    Clark pointed to an emergency coffer he and his colleagues have helped fill that’s offering $7,500 grants to businesses. On Broadway, though, rent can cost as much as $10,000 a month.

    While he said he can’t do a whole lot to force landlords to work with their tenants, he can help direct small-business owners toward resources like the fund or federal loan programs. He also said council representatives can communicate their concerns up the ladder to state representatives or the governor, if they have that kind of relationship.”

    https://denverite.com/2020/04/04/councilman-clark-losing-micro-businesses-on-broadway-would-be-soul-crushing/

    I opened the Westword dot com site, scrolled to the bottom of the front page and back to the top, and my ad-blocker blocked 229 ads, LOLZ.

    1. That’s a local snapshot of an international economic tragedy for the restaurant industry.

  18. Is 1 in 13 testing positive with expanded testing a good thing in a county with three million residents? If that rate were perfectly representative of the untested population, it would imply an expected number of about 3,000,000/13 = 231,000 cases out and about. Even if the 1 in 13 number is unrepresentatively high for untested people, the overall case count could far exceed 1,112.

    Now where’d I put that improvised face mask?

  19. My bad…the rate of recent positive test results in San Diego County is only 1 in 14 or so, thus 3,000,000/14 = 214,000 is a better number for the above discussion. Or maybe just “around 200,000”, since I am really just interested in the order of magnitude for comparison to the current case count of 1,112.

    1. I’m starting to think we need to do more math testing.

      I do concur that if 100% of tests were coming back positive, we’d be in much worse shape. The big mystery is what the case rate is among the approximately 3 million San Diegans who haven’t been tested. Apparently, despite a large number of competent statisticians in the U.S. population, no politician has thought much about the need to use inferential statistics to predict the overall number of cases, similar to a voter poll where a small number of samples individuals is used to forecast the numbers in the overall electorate voting for different candidates.

      Coronavirus Cases Grow by 146 to 1,112 as Testing Soars in San Diego County
      Posted by Chris Jennewein on April 3, 2020 in Tech
      Greg Cox, chairman off the San Diego County Board of Supervisors, with a face covering during the daily coronavirus briefing. Image from live stream

      Coronavirus cases in San Diego County topped 1,000 on Friday, but county health officials said it was a good sign that cases are not growing as fast as the number of tests.

      Cases grew by 146 to 1,112 in the county and one additional death was reported for a total of 17.

      The latest tally comes as total number of tests administered to county residents reached 15,831 — over 14 times the number of cases found.

      There is some encouragement here that there is a vast difference between the number of tests being conducted and the positive cases being reported, and we hope to see this trend continue,” said Supervisor Nathan Fletcher.

        1. Not necessarily, given that New York is in a far more severe state of crisis than San Diego. The more severely ill patients in an area relative to available test kits, the more the test results will reflect the infection rate in severely ill patients rather than the overall infection rate.

          What seems missing is some kind of stratified random testing in the part of the population that hasn’t yet been tested, to enable inference in the overall population in an area. What’s happening instead is that testing is heavily skewed towards severe cases on an as-needed basis, leaving the numbers of asymptomatic and mild case community spreaders a vast mystery.

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