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We Feel Absolutely Stupid, We Feel Powerless

It’s Friday desk clearing time for this blogger. “This June, Golden Gate Estates-based contractor Metro Home Builders filed for Chapter 7 bankruptcy. Out of the 64 paused home construction projects from Washington State to Marco Island, 29 are Naples-based. ‘It’s going to take all the cash that my wife and I can come up with to finish this (home). We’re going to be, in a way, broke,’ said Bill Christ, a Naples resident who purchased a home with the contractor about two years ago. Christ said that he spent nearly $400,000 on the home along Greenway Road. Currently, the house sits about 75% finished, still missing things like power, water, and air conditioning. It is not currently livable. ‘Primarily, I think I believed them because I hoped the thing would get done,’ Christ said.”

“‘I’m mad. But now I’m just heartbroken. I just can’t believe a human can do that to people.’ Connie Becker and her husband Mark say they paid $87K in February to a construction company called DADU Homes, to build a small apartment called an ADU. However, the unit is unfinished and now the couple says they are receiving bills from unpaid contractors. Including a lien on their property for $18k. ‘It’s like someone stole from you. And so betrayed. I feel betrayed. You know, I’ve worked hard all my life and, you know, somebody is just going to walk away with my money.’ DADU Homes’ owner Ken Miller has been politically active in Tacoma and Pierce County government for decades.”

“Court documents from the Becker’s and another DADU customer, Rick Kane, say they are accusing Miller of fraud. ‘He should do time. I mean, I emptied my family’s savings account. I emptied my mom’s savings account for this home that we’re sitting in that’s unfinished.’ Attorney Russell Knight represents Jennifer Catino, another one of Miller’s customers who paid him $120k. He did zero work. ‘He took the money, had no intention whatsoever of doing the work, did no work, and refused to refund her money,’ says Knight.”

“Philip Broussard was one of DADU Homes project managers. He says one of his issues was dealing with contractors demanding payment. ‘I was getting calls almost daily from angry subcontractors, angry suppliers, angry homeowners, people that were just absolutely furious about projects that weren’t being done. They’re $30,000 in the hole. And four months goes by, five months goes by, six months goes by. And they’re calling me, you know, I can’t afford to do this. You know, this is the stuff that puts us out of business,’ says Broussard.”

“Zachary Taylor Holt promised his clients a fully custom barndominium that gave them the space and freedom they wanted in the rural lot location of their dreams. Only he left a huge, expensive mess behind when took thousands of dollars and abandoned his projects, leaving property owners without a home. However, the law has finally caught up to Holt, who was arrested in Collin County on warrants for property theft between $30,000 and $150,000 from Titus County. Titus County is located east of Dallas County with the county seat in Mt. Pleasant. Several of Holt’s barndominium projects are located in.”

“A Star-Telegram investigation found examples throughout the state of people left with half-built steel structures, drained bank accounts and no way to recover the money they spent. The Star-Telegram spoke with nine customers of three Texas-based builders; their efforts to find legal remedies show that, in Texas, justice is the customer’s responsibility. ‘As with any fad, anybody who thinks they can actually do it is going to take advantage of the marketplace,’ said Sean McDonald, a construction attorney representing a Holt client.”

“Most of the victims from other jurisdictions appear to have been told their only recourse for Holt’s actions is to pursue damages through civil means,’ the Titus County Sheriff’s Office told CBS 19 (KYTX). ‘It is our belief that the repetitive and frequent nature of Holt’s actions rose to the level of proving Holt’s intent to defraud.'”

“Colorado rental homeowners may be getting hit with heavier taxes if a state bill passes in the next few months, and it could leave a lasting mark on the housing market. The legislation would classify short term rental properties as ‘commercial’ and therefore institute a higher tax rate on the homeowners. Tens of people showed up to express their fears around the tax hike. ‘We need to have this home available to short-term rental guests to pass this legacy onto our kids,’ said resident Eric Richards, as reported by The Colorado Sun. If the extra tax becomes law, many say they will have to sell their properties. ‘We cannot live with all these types of restrictions … this will, in my humble opinion, kill the short-term rental economy in Colorado,’ said property management company owner Hillary Skye at this week’s hearing.”

“Lendlease Group and Alphabet’s Google are mutually ending development services deals for four master-planned districts worth $15 billion in the San Francisco Bay Area, the Australian company said on Friday, as developers continue to exit California’s real estate market. Lendlease bagged the contract from Google in 2019 to develop the residential and retail space in Sunnyvale, San Jose and Mountain View, which could ultimately bring around 15,000 new housing units to the region. Earlier this year, Lendlease also paused its 47-storey Hayes Point project in central San Francisco, its largest investment in the Americas, looking to line up tenants or find a co-investor. Lendlease said it will remove the San Francisco Bay project, which was expected to commence construction in fiscal 2026, from its development pipeline. ‘While market expectations for the project had deflated over the past ~12-18 months, the change is negative for medium term (FY26-28) earnings,’ analysts at UBS said.”

“A jury in Missouri found Tuesday that the National Association of Realtors and others colluded to keep real estate agent commissions high. Agents say they’re being unfairly targeted. Aaron Kirman, chief executive officer of his own Los Angeles-based team at Christie’s International Real Estate, said there’s already plenty of transparency and flexibility around commissions, which in LA have already fallen to 2% to 2.5% for each side of a deal in higher-priced transactions. ‘Every single day, I negotiate my commission — not something that I love to do, but it’s just part of the business,’ Kirman said. ‘The industry is under attack at a time when we’re in an all-time difficult market.'”

“In a report released ahead of the verdict, Ryan Tomasello, a real-estate industry analyst with Keefe, Bruyette & Woods, predicted that the lawsuits could lead to a 30% reduction in the $100 billion that Americans pay in real-estate commissions every year and push well over half of the almost 1.6 million agents out of the industry. ‘I have a hard time believing that this could be the verdict and there’s no material changes,’ said Anthony Lamacchia, whose brokerage Lamacchia Realty has more than 500 agents in six states. ‘It’s just what, and when, and what does it lead to?'”

“Troubling headwinds continue to persist in the preconstruction real estate industry as homebuyers unable to close their transactions are walking away from sizable deposits, some worth as much as $320,000. It’s a new phenomenon, industry experts say, particularly in lowrise homes in the GTA suburbs where prices ran up quickly during the pandemic and have fallen drastically. As closing dates near, buyers are unable to close as appraisals fall short or they’re unable to qualify for a mortgage. Some of the buyers walking away are end-users and some are trying to off-load an assignment sale — a legal transaction in which the original pre-construction condo buyer transfers the rights and obligations of the purchase agreement to another buyer.”

“‘It’s unusual activity, but predictable given the current real estate environment,’ said Daniel Foch, director of economic research at RARE Real Estate Inc. ‘It’s still pretty rare to see people walking away from such large deposits, but it’s becoming increasingly more common. This is just the beginning.’ Property values have fallen most for single detached homes in cities between Toronto and Barrie, such as King City and East Gwillimbury, said Mark Morris, a lawyer at real estate law firm Legalclosing.ca. During the February 2022 price peak, the average home price in King City was $3.2 million and dropped to $2 million in September 2023 — a decline of almost 40 per cent, according to the Toronto Regional Real Estate Board.”

“‘We’re seeing it happen the most in cities that are an hour or two outside of Toronto, where people paid $1 million for a property and are now getting appraisals of $600,000,’ Morris said. ‘They’d rather face the builders’ wrath and walk away, than close on that transaction.'”

“A resident of a new housing estate in Winsford has shared his anger over the state of the site. Craig Dentith moved to Florence Way on the Wharton Green estate last December with his partner Sarah and their one-year-old daughter Emelia. However, a lack of street lighting, unfinished roads and an ever-growing pool of water have left him ‘appalled’. The 27-year-old said: “The estate is hampered by inadequate street lighting with only a very small amount of them that actually work. I have also raised concerns about the unfinished park which is currently blocked off and the state of our roads and footpaths which desperately need resurfacing and are starting to cause damage to peoples’ cars. Next to the park is a huge ditch filled with deep water, obviously this has worsened due to the recent weather.”

“‘Not only is this an eye-sore but it’s extremely dangerous and poses a huge risk to young children who may try and explore the area as it’s only fenced off by metal fencing’ Craig added. ‘Equans departed the estate in mid-summer and has been relishing the headlines of a ‘completed’ estate, unfortunately for my family and many others this isn’t the case and has caused a huge amount of misery. There is no sign that the estate is going to be completed any time soon and the state it has been left in is completely appalling. The fact we have been left with an estate which barely has any street lighting, unfinished roads in a shocking condition and a park that will soon only be suitable for fishing is disastrous and I and many others are starting to have regrets about moving to the estate.'”

“An independent Western Australian building company attached to a major national construction franchise has collapsed into liquidation. On Thursday afternoon, RPH Australia Pty Ltd appointed Robert Brauer and Linda Smith of insolvency firm McGrath Nicol as voluntary liquidators. RPH Australia Pty Ltd was trading under the name GJ Gardner Perth West as it was part of the GJ Gardner network, a major building franchisor which has nearly 100 independent building companies and offices dotted around Australia. One customer told news.com.au he had been waiting three years for his house and there was ‘no end in sight.'”

“The man, who wanted to remain anonymous, signed a contract in March 2020 and his build is still not complete. The customer claims the company ‘lied constantly to me with false finish dates and progress updates. My build has been a disaster since the first day I signed the contract,’ he lamented. ‘I also think that GJ Gardner need to take responsibility for this outcome,’ he said, adding that ‘at no point’ did the master franchisor inform customers of the financial difficulties its Perth West branch was facing.”

“A five-bedroom house at 55 Cliff Rd, above the elegant Auckland suburb of St Heliers, was this week listed for mortgagee sale by Barfoot & Thompson. Tenders close on Friday at midday. Auckland Council assigned the house a rateable value of $9.9m last year, with a hefty rates bills to match: $19,628 this year. It’s the home of Tommy Xianzhen Huang, the owner of property development company Treasure Plus Ltd. As well as Huang’s home, the Treasure Plus receivers are trying to sell a $9.2m site in Mission Bay and a $4.5m empty lot in Māngere Bridge and they have written to buyers who have pre-purchased apartments in the 82-unit Dawn Park development in Te Atatū.”

“Buyers were already worried about progress on Dawn Park. One young couple told Newshub last year they were worried their life savings were gone. They had purchased one of the apartments off the plans in July 2021, expecting to have keys in hand a year later. But they had watched as materials were removed and the building site was stripped down to bare timber framing. ‘We feel absolutely stupid,’ they said. ‘We haven’t had any proper response from them since May, so half a year. We feel powerless.'”

“In its financial stability report yesterday, the Reserve Bank warned that more borrowers are under pressure on their debt obligations. For now, rates of non-performing mortgages and the number of mortgagee sales remain low – but they’ve been increasing in recent months. ‘We expect an increasing share of borrowers will face significant debt servicing stress,’ the report says. Early-stage mortgage arrears have increased over the past six months and have now surpassed the levels seen at the start of the pandemic.”

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This Post Has 86 Comments

  2. ‘Lendlease Group and Alphabet’s Google are mutually ending development services deals for four master-planned districts worth $15 billion in the San Francisco Bay Area, the Australian company said on Friday, as developers continue to exit California’s real estate market. Lendlease bagged the contract from Google in 2019 to develop the residential and retail space in Sunnyvale, San Jose and Mountain View, which could ultimately bring around 15,000 new housing units to the region’

    Walking away from 15k shacks in Ka-ifrna? Say it ain’t so!

  3. So he paid someone 87K, to build a backyard structure, and it was never built? That sucker was ready to be plucked ,must say …A christmas present in July….. not much sympathy for this victim ……..you don’t just give money away , and then hope for results,of some kind…

  4. The legislation would classify short term rental properties as ‘commercial’ and therefore institute a higher tax rate on the homeowners.

    Stop the dissembling, REIC shills. These “homeowners” are housing speculators running de facto hotels in residential neighborhoods. Tax them accordingly, along with slapping punitive fines on them every time their “guests” disturb formerly peaceful neighborhoods.

  5. ‘We cannot live with all these types of restrictions … this will, in my humble opinion, kill the short-term rental economy in Colorado,’ said property management company owner Hillary Skye at this week’s hearing.”

    Die, speculator scum. Just die already.

    2. “We cannot live with all these types of restrictions … this will, in my humble opinion, kill the short-term rental economy in Colorado,’ said property management company owner Hillary Skye at this week’s hearing.”

      //

      “Colorado rental homeowners may be getting hit with heavier taxes if a state bill passes in the next few months, and it could leave a lasting mark on the housing market. The legislation would classify short term rental properties as ‘commercial’ and therefore institute a higher tax rate on the homeowners.”

      //

      – That’s gonna leave a mark, a lasting mark. 😬

      – STRs are effectively unregulated motels. They’re in residential zoning (homeowner neighborhoods), but the belong in commercial zoning, just like any other motel/hotel.

      – STRs motels have no front desk for monitoring the property, so a full spectrum of behaviors is possible, both good and bad. See “Bell Curve.” Gunshots, wild parties at all hours aren’t uncommon. How’d you like that for your neighbor in an otherwise quiet resi. neighborhood?

      – STRs consume lots of SFH inventory that would otherwise be available for purchase or LTR. This raises local house prices and rents.

      – STRs are a pox on resi. neighborhoods. They’re illegal in my view. No good or benefit to society has come of this. The tide is turning. From outright bans to higher fees and taxes. This is a good thing for U.S. and global housing markets. F AirBnB. Ban them all. Time to reverse the financialization trend sweeping the world. Housing is shelter, and right now it’s unaffordable shelter. Between this and the deranged Federal Reserve, it’s no wonder there are so many financially struggling and even homeless. F the Fed also.

  7. ‘The industry is under attack at a time when we’re in an all-time difficult market.’”

    That’s because you’ve engaged in racketeering for decades, UHS shysters.

  8. ‘We feel absolutely stupid,’ they said. ‘We haven’t had any proper response from them since May, so half a year. We feel powerless.’”

    Just to clarify your situation, you ARE stupid and you ARE powerless. Feelings have nothing to do with it.

    1. Financial Times
      US employment
      US jobs growth slows more than forecast in October
      World’s biggest economy added 150,000 new roles last month as unemployment rate rises to 3.9 per cent
      People wait to speak with prospective employers at a job fair in Los Angeles
      A career fair in Los Angeles. Jobs growth is an important indicator for investors and Federal Reserve rate-setters
      Harriet Clarfelt in New York and Colby Smith in Washington 34 minutes ago

      Jobs growth in the US slowed sharply in October, according to a fresh labour market report that is likely to shape interest rate expectations for the world’s biggest economy.

      US employers added 150,000 new roles last month, according to the Bureau of Labor Statistics, down from a revised 297,000 added in September.

      Economists surveyed by Bloomberg had expected 180,000 new roles.
      …

      1. Not to worry! Wall Street is cheering the weak jobs numbers as confirmation the Fed is done. Enjoy your Santa Claus rally.

        1. Why stock-market bulls say ‘Santa rally’ may have already started as equities surge to kick off November
          Provided by Dow Jones
          Nov 2, 2023 10:46 AM PDT
          By William Watts

          Stock-market bulls looking for a year-end rally are feeling encouraged as a four-day rally accompanied by retreating bond yields helps take the sting out of three-month retreat that sent the S&P 500 and Nasdaq Composite into market corrections.

          “Halloween is over…it is conceivable here that the Santa Claus rally has already started simply because pessimism was so thick in September and October,” markets economist Ed Yardeni, president of Yardeni Research Inc., told MarketWatch Thursday.

          The Dow Jones Industrial Average DJIA was up around 475 points, or 1.4%, in afternoon trade, while the S&P 500 SPX surged 1.7% and the Nasdaq Composite COMP jumped 1.6%. The Dow and S&P 500 were on track for their strongest weekly gains of 2023, according to Dow Jones Market Data.

          Meanwhile, Treasury yields retreated sharply, with the 10-year rate dropping more than 7 basis points to 4.69% and marking a 10-day drop of more than 33 basis points, the biggest such 10-day move since March, according to DJMD. It was a surge in yields, which move opposite to debt prices, that got most of the blame for the stock-market pullback that began in late July.

          The stock-market rally and yield retreat were both accelerated after the Federal Reserve on Wednesday left rates on hold for a second straight meeting. Moreover, Fed Chair Jerome Powell, while leaving the door open to further tightening, didn’t signal that another rate increase was assured, prompting investors to bet rates have peaked.
          …
          https://www.morningstar.com/news/marketwatch/20231102489/why-stock-market-bulls-say-santa-rally-may-have-already-started-as-equities-surge-to-kick-off-november

        2. That’s because Wall St only cares about the top 10%. Yet the country is anesthetized into believing a rising stock market means everything in gonna be okay. Wake up folks.

      2. Financial Times
        Eurozone economy
        Eurozone unemployment rises from record low to 6.5%
        Signs of weakness in labour market could relieve inflationary pressures in 20-member bloc
        An employee working on the production line at a Ford car plant in Valencia, Spain
        Some companies hit by falling demand have given up hope of an improvement in the next year or two and are starting to cut jobs
        Martin Arnold in Frankfurt 58 minutes ago

        Unemployment in the eurozone has increased from its record low, rising unexpectedly to 6.5 per cent as high interest rates and a stagnating economy start to take their toll on the region’s job market.

        Eurostat, the EU statistics office, said on Friday that the number of unemployed people rose 69,000 in September from the previous month to a total of just over 11mn in the 20 countries that share the euro.
        …

      3. as unemployment rate rises to 3.9 per cent

        I’m seeing a lot of layoff notices. Good thing we’re not in a recession.

        1. And small businesses are getting slammed. Especially those who service housing industry. Was talking to a home theater guy last week. For the last three years he’s been booked out as much as a year. A few months back almost everything on his books cancelled. He’s now got one job booked after the one he’s working on and no one is calling. But you’re hearing this everywhere. And as you drive around neighborhoods your seeing work trucks sitting in driveways and not out working. Not hard to see the signs when your looking.

          1. For the last three years he’s been booked out as much as a year

            Amazing what low interest cash out refis could do. They also created a lot of $30K+ bathroom remodels and $10K lawn sprinkler systems.

          2. Meanwhile, I still struggle to get electricians to call me back to connect my generator to the transfer panel.

            Spoke to 4 electricians, only one followed-through to do the work. Ended up costing way more than I believe appropriate, but apparently that’s the market here /shrug

        2. When more and more people are thrown out of work, unemployment results. – Calvin Coolidge

    3. Financial Times
      Opinion The Long View
      Equity market rally risks being another head fake
      Investors appear to be hoping that if recession does strike the US early next year, the Fed will relent on interest rates
      Headshot for Katie Martin
      Katie Martin
      Bankers tell investors to ‘trust the pipeline’ but a series of disappointing performances from companies like Arm, Alphabet and Instacart have dampened the mood
      Katie Martin 3 hours ago

      Bankers who launch companies on to stock exchanges for a living are generally some of the more cheerful souls you will encounter in financial markets. Not for them the professional grouchiness of bond market grumps obsessing over stuff that can go wrong. Instead, no matter how dire the market conditions, they have that chirpy estate agent’s knack of predicting brighter times ahead, in the form of “the pipeline”.

      The flow of new deals reaching public markets does dry up from time to time. But when it does, bankers reliably say “the pipeline” is just on the brink of spilling out new listings. Good listings, quality companies. Just you wait.

      This line has been starting to wear a bit thin after the mood turned strikingly grim — even some of the most enthusiastic cheerleaders for public markets have been struggling to put on a brave face.

      There has been about a 5 per cent drop in the S&P 500 from the peak in July, driven in large part by the growing acceptance that interest rates are likely to stay high for the long haul. This hurts on two fronts. It raises the bar for investors to bother with the asset class in the first place: why take the risk when safe short-term US or European government bonds give you 5 per cent? It also singes corporate balance sheets.

      “The higher-for-longer environment is leading to a major shift in the corporate ecosystem,” wrote Allianz Global Investors global chief investment officer for equities Virginie Maisonneuve. “After over a decade of ultra-low rates, some poor-quality companies . . . may now struggle to survive.”
      …

    1. The problem is people are idiots. They believe that nothing is negotiable and whatever a realtor tells you you need to pay must be what you have to pay. This has always been NONSENSE. Everything is always negotiable. The last house I sold I never went under contract with any realtor. What I did is sent out a notice to several of the realtors I found reputable and basically said I’m not going under contract with you, but you’re welcome to show my house and if you have an interested buyer then we’ll talk about price and your commission. Oh, and if you’re worried about all the contract stuff you can usually find an escrow officer at the title company you’ll be using to walk you through everything as part of their normal fee and likely do a better job at it than your realtor (I realize that this is a little different out here in the West. Many places do a round table with a lawyer for the contractual stuff). At the very least always negotiate commission with your listing agent. Nothing has ever been written is stone.

      1. This x1000

        and

        The realtor isn’t working for you, the realtor is working for The Deal. They don’t care what you pay (or what you make). Negotiate well and do so much better than almost everyone else.

        You make your profit when you buy.

  11. Update on Panama:
    Yesterday I walked around the financial district part of the city and found a number of bus seating areas that had the glass totally destroyed and one glass panel in the metro. Also a few large advertising glass signs were broken. Quiet last night and today is a Holiday, essentially Independence day from Columbia.
    People I have talked to say It’s about the mining contract but they also allude to politics being involve. (of course)

  12. ‘It’s outrageous’: Dave Ramsey revealed the real reason Americans are going broke — and it’s not inflation. 3 simple steps to fix your finances now

    https://www.yahoo.com/finance/news/wussed-dave-ramsey-reveals-real-100000006.html

    Record-breaking inflation rates may have throttled Americans’ budgets over the last year, but Dave Ramsey says you can’t blame high costs for all your financial woes.

    On a popular episode of The Ramsey Show, host Ramsey stated that household debt is at an all-time high — not because inflation is increasing the price of essential goods like groceries, but because of how consumers have responded to these price changes.

    “Let’s be clear here. The debt is not because of inflation,” Ramsey said during the episode. “The debt is because you wussed out and refused to cut your freaking lifestyle to offset inflation.”

    You can save enough for retirement by putting $100 per month in a conservative growth fund from age 25 to 65, Ramsey said, but for that to work, “You can’t have a $750 F-150 payment. You can’t have a student loan that’s been around so long you think it’s a pet.”

    He added: “All you do is work for these stinking banks that have better furniture and bigger buildings than you do.”

    Ramsey went on to state that debt has become normalized in America if not throughout the world. It’s now a huge obstacle for those seeking to save money and put that cash toward retirement.

    Yet, instead of paying back debt, consumers seem to be using credit cards and other loan methods to continue funding their daily spending, Ramsey said. Rather than cut back during inflation, consumers chose to make up for the shortfall by borrowing money to maintain their lifestyles.

    Ramsey stated that people’s continual reliance on consumer debt has kept him in the financial advice-giving business for the last several decades and will give him job security for several more.

    2. One of the best ways to kill inflation? Stop buying things you can’t afford. No demand equals lower prices.

      1. If you don’t go in debts to buy things you don’t need, how would banksters/corps make their billions?

    3. Want to save $200 a month or more? Make your own coffee and quit paying almost $10 a day to your favorite barista. Want to save another $100 a month? Wash your own car or tell your kid to get off Tik-Tok and go do it (😱). Same thing with lawn. It’s almost like no one even understand the concept of a tightening belt anymore.

      1. It’s almost like no one even understand the concept of a tightening belt anymore.

        Only “loosers” resort to belt tightening. Keeping up appearances, a la Stanley Johnson, is very important to a lot of people.

        1. Maersk cutting at least 10,000 jobs as shipping boom unravels

          Looks like some people are tightening their belts.

    4. “Let’s be clear here. The debt is not because of inflation,” Ramsey said during the episode. “The debt is because you wussed out and refused to cut your freaking lifestyle to offset inflation.”

      He’s not wrong, but that’s a tough sell from a Boomer to kids who watched pre-existing homeowners and sundry types of speculator scum get obscenely rich(er) from said inflation. You have to eat bugs, but that’s a sacrifice they’re willing to make.

  13. (This article is not housing related but is indictive of the economy’s general well-being …)

    Maersk cutting at least 10,000 jobs as shipping boom unravels

    https://finance.yahoo.com/news/shipping-giant-maersk-q3-above-071257250.html

    (Some selected snips …)

    Shipping group A.P. Moller-Maersk, reported a steep drop in third-quarter profit and revenue on Friday and said it would cut at least 10,000 jobs in the face of overcapacity, rising costs and weaker prices, sending its shares tumbling.

    Maersk, which controls about one-sixth of global container trade, transporting goods for a host of major retailers and consumer goods companies such as Walmart and Nike, flagged a steeper downturn in demand than analysts and investors had expected.

    “The new normal we are now headed into is one of more subdued macroeconomic outlook, and thus soft volume demands for the coming years, prices back in line with historical levels, inflationary pressures on our cost base, especially from energy cost, and also increased geopolitical uncertainty,” CEO Vincent Clerc said on an investor call.

    The industry invested heavily in new container ships during and after the pandemic to meet strong demand and benefit from record freight rates. A large number of new ships entered the market since the summer with no signs of idling or scrapping, said Clerc.

    “If the fourth quarter does not deliver some type of improvements, then I think we’re looking at a pretty dire situation in 2024,” he said.

    Negative revenue growth in the third quarter came mainly from the retail and lifestyle sector, especially in North America, as well as automotive and technology, Clerc said.

    Maersk said it expects global container volumes in its ocean business, its largest segment, to fall by up to 2% this year, primarily as a result of weak consumer demand and destocking by firms following the scramble for goods in the aftermath of the coronavirus pandemic.

  14. “It’s still pretty rare to see people walking away from such large deposits, but it’s becoming increasingly more common.”

    It’s simple math. When home prices are dropping during construction on a presold build, once the future owner realizes the loss on current contract on the home exceeds the amount of the deposit in escrow, the smart ones will just walk away. This just happened to my contractor buddy up on the Oregon coast. He was under contract on a home for 850k and the buyer had put down a 75k deposit. The build began last spring. Since then homes there have taken a pounding. The buyer realized that in current market conditions the home was now maybe worth 700k with prices continuing to drop. They did the math and walked. My buddy is freaking out even with the 75k he gets to keep. He gonna take it in the keister on this one. Now he’s got a spec house in market where nothing is moving.

  15. “Pay Us Now!” Workers Cry as China’s Largest Appliance Retailer’s Revenue Tumbles 96%, Gome Is Done!
    China Observer

    3 hours ago

    At the beginning of 2023, approximately 50 employees protested at a Gome Retail located in Wuhan, China. They chanted: “Wuhan Gome owes us wages! Give back our hard-earned money!” Since the pandemic, Gome Retail (formerly known as Gome Electrical Appliances) has been grappling with a significant economic downturn, resulting in months-long salary arrears for the employees, prompting Gome staff nationwide to protest for their wages.

    https://www.youtube.com/watch?v=4B76aiD9kcw

    16:34.

    1. resulting in months-long salary arrears for the employees

      The Chinese must be the most patient people in the world. How many people here would hang around after a single missed payroll?

      1. “How many people here would hang around after a single missed payroll?”

        Not many and they wanted them to sign for a year of work before getting paid back wages Makes it hard to feel bad for the people who paid for appliances that weren’t delivered 3 months later.

      2. I don’t know how that lesson got lost, but in both 01 and 08 I knew more than a few people that stayed working on at f*ckedcompanies and zombie companies FOR MONTHS WITHOUT BEING PAID in hopes that they would get more funding. Of course not a one of them got paid.

        When I started working (mid 80’s) if a company missed a check/late/bounce literally the entire crew was gone down the road THAT DAY. I don’t understand how that knowledge got lost. No pay no work.

        1. I’ve had two jobs in my life which I would have stayed for a while even if they couldn’t make payroll.

  16. (Here is an update of the assault and battery “prank” that was posted here a few days ago …)

    Teens involved in alleged assault of 2 men for TikTok ‘prank’ charged

    https://abc13.com/wortham-park-joggers-assault-aggravated-robbery-tiktok-prank-teens-now-in-custody/13992121/

    Two teens accused of assaulting two men for a TikTok prank at a northwest Harris County park are now charged.

    Alford Lewis, 19, is being held on a $10,000 bond for an aggravated robbery with a deadly weapon charge and a $100 personal bond for his assault charge.

    Kingston Miker, 18, is facing the same charges as his former classmate but has not been arrested.

    According to charging documents, Lewis assaulted two men in separate incidents at Wortham Park last Thursday while Miker recorded.

    (Here is a description of Prank Number 1:)

    In one incident, deputies reported that Lewis used a gun and physically assaulted the victim to rob him of his iPhone 14, valued at approximately $1,000.

    Deputies say Lewis approached a man walking on the park’s trail from behind. Lewis allegedly demanded the man’s cell phone with a gun pointed at him and threatened to shoot him in the foot.

    When the victim refused to give up his cell phone, Lewis reportedly passed the gun to Miker, who was filming the incident. Officials said Miker then pointed the gun at the victim while Lewis punched and choked him.

    (Now here is a description of prank Number 2:)

    About 45 minutes later, Lewis is seen on video hitting another man from behind. The second victim told investigators that Lewis and Miker laughed and when the victim said he did not find it funny, he believes Lewis reached for a gun.

    The videos were then uploaded to TikTok.

    Lewis admitted to the assault and told ABC13, “It was a prank. I had no problem with the man. I wasn’t trying to hurt him. I was hanging out with my friend, and we did a TikTok (video), and so, yeah, I didn’t mean it, didn’t mean to harm anybody.”

  17. So the Fed holds another rate-setting circus to rubber-stamp the 3-month yield. The stock market predicts the 17th of the last 0 pivots (never mind your lying ears when Powell says “The Fed is not thinking about rate cuts at all.”) I am now soberly informed that yields are “collapsing.” I guess inflation is well and truly whipped and Janet “we can absolutely afford two wars” Yellen has magically turned the US from a drunken bankrupt back to a prudent and responsible borrower. Glad that’s over. Looking forward to paying 1950 prices for housing, groceries, and other essentials again.

    1. Sarcasm aside, my wild guess is this was a cover on the news moment, bonds were oversold and it was time to back off and consolidate for the final assault on 5%.
      Alternate guesses: Fed is running the printer for the obligatory Santa Claus rally, and/or another big bank is bleeding out.

    2. ‘The stock market predicts the 17th of the last 0 pivots (never mind your lying ears when Powell says “The Fed is not thinking about rate cuts at all.”)’

      That’s the apparent standoff. Everyone except the Fed seems to believe interest rates will drop like a rock the moment the inflationary fever breaks, and it’s hard to read between the lines of official Fed higher-for-longer guidance what they really believe.

      Turns out this mass belief in lower-sooner rates is inflationary!

  19. “I just can’t believe a human can do that to people.”

    “[Under the paper currency system,] an wholesale demoralisation of society took place under which thrift, integrity, humanity, and every principle of morality were thrown into the welter of seething chaos and cruelty.”

    – Andrew Dickson White, Fiat Money Inflation in France, 1912. Plenty more in that vein but that’s the gist. Unsound currency is the express elevator to hell.

    1. “I just can’t believe a human can do that to people.”

      History is chock full of such atrocities.

    2. Is that the one where he chronicles how each round of inflation gets easier and easier to sell until they are just throwing money around like it’s nothing? We seem to be rapidly approaching that mindset.

  20. I have no idea what led up to this old dude opening a can of whoop@ss on this kid or if he deserved it or not but I do know that if the race of the kid and the bus driver were reversed this would have been National news 2 days ago.

    Jefferson Parish school bus driver caught on video allegedly slapping, choking student

    Nov 1, 2023

    https://youtu.be/yURBHVH8ZwM?si=LSEDlGVGVKx1DmrX

  21. The year was 1969, I was nine going on ten years-old and growing up in what now seems now like a Norman Rockwell painting. Enjoying new freedoms like my friends and I riding our Schwinn Stingrays downtown for lunch on Saturdays or to Binney Park for baseball games or practice, the world we were discovering seemed like a pretty cool place.

    The Vietnam War was on the evening news every night, In January that year the New York Jets shocked the world beating the Baltimore Colts in the Super Bowl, that Fall the “Miracle” Mets did the same beating the heavily favored Baltimore Orioles, that summer Apollo 11 landed on the moon and Neil Armstrong took one giant leap for mankind, the Manson Family Tate–LaBianca murders happened in LA. We watched it all on black and white TVs and listened to it on transistor radios,

    Hell back then Michael Jackson was still a black kid singing with his brothers, it was a special time indeed.

    I Want You Back · Jackson 5

    https://youtu.be/UvynvnxZJ3Q?si=6YmqPQkBoB4hLcad

    2. “The year was 1969”

      I wasn’t alive yet then, but I am a big fan of the Jackson 5.

      That year makes me think of: Vietnam (my uncle served there), Richard Nixon sworn into office from the votes of the Silent Majority, the Rolling Stones concert at Altamont (this concert, not Woodstock), and bands like this emerging from the Midwest that played at neither.

      The Stooges — 1969:

      https://www.youtube.com/watch?v=mS_BsLxMqn4

  22. ‘We’re going to be, in a way, broke…Primarily, I think I believed them because I hoped the thing would get done’

  23. ‘I was getting calls almost daily from angry subcontractors, angry suppliers, angry homeowners, people that were just absolutely furious about projects that weren’t being done. They’re $30,000 in the hole. And four months goes by, five months goes by, six months goes by. And they’re calling me, you know, I can’t afford to do this. You know, this is the stuff that puts us out of business’

    This is the inevitable result of booms. It gets ugly.

  24. ‘A Star-Telegram investigation found examples throughout the state of people left with half-built steel structures, drained bank accounts and no way to recover the money they spent. The Star-Telegram spoke with nine customers of three Texas-based builders; their efforts to find legal remedies show that, in Texas, justice is the customer’s responsibility. ‘As with any fad, anybody who thinks they can actually do it is going to take advantage of the marketplace’

    I hear radio ads for these schemes regularly.

  25. ‘Lendlease said it will remove the San Francisco Bay project, which was expected to commence construction in fiscal 2026, from its development pipeline. ‘While market expectations for the project had deflated over the past ~12-18 months, the change is negative for medium term (FY26-28) earnings’

    That sounds like worser for longer.

  26. ‘Every single day, I negotiate my commission — not something that I love to do, but it’s just part of the business…The industry is under attack at a time when we’re in an all-time difficult market’

    That may be Aaron, but it’s still a sellers market!

    via GIPHY

  27. ‘Some of the buyers walking away are end-users and some are trying to off-load an assignment sale’

    End users getting fooked cuz they were surrounded by speculators – check.

  28. ‘We’re seeing it happen the most in cities that are an hour or two outside of Toronto, where people paid $1 million for a property and are now getting appraisals of $600,000…They’d rather face the builders’ wrath and walk away, than close on that transaction’

    Well it is officially a buyers market now Mark, going by the months of inventory.

  29. ‘I have also raised concerns about the unfinished park which is currently blocked off and the state of our roads and footpaths which desperately need resurfacing and are starting to cause damage to peoples’ cars. Next to the park is a huge ditch filled with deep water, obviously this has worsened due to the recent weather…Not only is this an eye-sore but it’s extremely dangerous and poses a huge risk to young children who may try and explore the area as it’s only fenced off by metal fencing’

    When I was a kid, this is where we played.

      1. Don’t know if I ever shared my childhood fascination for train tracks with my mom. We apparently had the good sense to stand back when trains passed through.

  30. ‘During the February 2022 price peak, the average home price in King City was $3.2 million and dropped to $2 million in September 2023 — a decline of almost 40 per cent’

    Nice work locals, that’s the spirit, keep up the good work!

  31. Take Five | Harmonica Cover | Perfect Fourth
    Perfect Fourth
    3 years ago HONG KONG

    Chromatic Harmonica: Cy Leo
    Chromatic Harmonica: Ivan Chong
    Double-Bass Harmonica: Jerry Wong
    Chord Harmonica: Ramiel Leung

    Composer: Paul Desmond
    Harmonica-Cover Arranger: Cy Leo

    =====
    “Take Five” is a jazz standard composed by Paul Desmond and originally recorded by the Dave Brubeck Quartet at Columbia Records’ 30th Street Studio in New York City on July 1, 1959 for their album Time Out. Two years later it became a hit and the biggest-selling jazz single ever. Revived since in numerous movie and television soundtracks, the piece still receives significant radio airplay.
    Source: https://en.wikipedia.org/wiki/Take_Five

    =====
    Perfect Fourth is a traditional musical term representing a unique relation between two pitches. While the use of it has been prevalent even in the European middle ages, the stacking of fourths is also often used nowadays to create chords and progressions with a sense of modernity.

    The Perfect Fourth Harmonica Quartet aims at creating a modern and fashionable performance style on the basis of their invaluable traditional influence.

    https://www.youtube.com/watch?v=mpsaq5V237w

    2 minutes.

  32. I’ve listened to this song since 1977 but never knew the story of how ‘deuce’ got switched to ‘douche’.

    Blinded By The Light · Manfred Mann’s Earth Band

    https://youtu.be/JZW9meY2IPw?si=Tl7WTpeXVYyoA6Ez

    From Wikipedia

    “Blinded by the Light” is a song written and recorded by Bruce Springsteen, which first appeared on his 1973 debut album Greetings from Asbury Park, N.J. A cover by British rock band Manfred Mann’s Earth Band reached number one on the Billboard Hot 100 in the United States in February 1977 and was also a top ten hit in the United Kingdom, New Zealand, and Canada.

    I don’t think Springsteen liked our Blinded by the Light, ‘cos we sang ‘wrapped up like a douche’, and it wasn’t written like that and I screwed it up completely. It sounded like ‘douche’ instead of ‘deuce’, ‘cos of the technical process – a faulty azimuth due to tape-head angles, and it meant we couldn’t remix it.

    Warners in America said, ‘You’ve got to change ‘douche’, ‘cos the Southern Bible belt radio stations think it’s about a vaginal douche, and they have problems with body parts down there.’ We tried to change it to ‘deuce’ but then the rest of the track sounded horrible, so we had to leave it. We just said, ‘If it’s not a hit, it’s not.’

    But in the end, it was No.1 in America, and so many people came up to us after and said, ‘You know why it made No. 1?… Everyone was talking about whether it was deuce or douche.’ Apparently Springsteen thought we’d done it deliberately, which we hadn’t, so if I ever saw him I’d avoid him and cringe away like a frightened little boy.

    — Manfred Mann, Record Collector interview (August 2006), [11]

  33. Dumb questions of the day:

    1) Is putting ginormous windmills out in the middle of the ocean a smart way to generate electricity?

    2) How much fossil fuel has to get burned to install, maintain, and eventually scrap those windmills?

    1. Nov 02, 05:31
      S&P threatens Ørsted with credit rating downgrade
      David Sheppard in London

      Ørsted, the world’s largest offshore wind developer, has been threatened with a downgrade by credit rating agency S&P after taking huge writedowns on its US projects this week.

      S&P Global Ratings said it was placing the Danish company’s long-term ratings on “CreditWatch Negative” saying the “severity” of the $4bn writedown was larger than anticipated and that it had concerns over “the project management issues this reveals”.

      “We have revised downward our view of management and governance,” S&P added. It said Ørsted’s rating could be lowered one notch early next year after a meeting with management.
      …

    2. Danish energy developer Ørsted delivered a setback to Biden—and its own investors
      Ørsted pulled out of Ocean Wind 1 and Ocean Wind 2 in New Jersey
      By Ananya Bhattacharya
      PublishedWednesday 12:39PM
      Wind’s changing direction.
      Photo: Tom Little (Reuters)

      Danish energy developer Ørsted didn’t just disappoint the Biden administration with a decision to scrap two large offshore wind power projects off the coast of New Jersey. The move also disappointed shareholders, who knocked more than 25% off the value of Ørsted’s stock.

      Construction of the first two projects, Ocean Wind 1, was slated to begin in 2024 with plans to have it up-and-running the next year. Construction for Ocean Wind 2 was slated to begin in 2028.

      The company had earlier flagged supply chain issues. Rising interest rates cast additional skepticism that the projects would get done as planned. Whatever the reason, the pullout is a setback for the Biden administration’s green energy plans.

      New Jersey governor Phil Murphy called Ørsted’s decision “outrageous” but said “the future of offshore wind in New Jersey remains strong.” He added that the state has seen “ a historically high number of bids” recently and that the Board of Public Utilities will shortly announce two additional offshore wind solicitations.

      Republican politicians have already called for the remaining projects off the coast of New Jersey to be called off, playing up the expense, plus threats to marine life and tourism.
      …
      https://qz.com/danish-energy-developer-orsted-delivered-a-setback-to-b-1850979774

  34. Financial Times
    US interest rates
    BlackRock says investors set to face 5.5% long-term borrowing costs
    Asset manager points to ageing populations and fractious geopolitics pushing up 10-year Treasury yields
    BlackRock headquarters in New York
    BlackRock says it sees ‘inflation on a rollercoaster’
    Mary McDougall in London
    14 hours ago

    The world’s largest asset manager sees benchmark US borrowing costs hovering around 5.5 per cent for the next five years as investors grapple with inflationary pressures.

    Ten-year yields are at 4.56 per cent, but Jean Boivin, head of the BlackRock Investment Institute and a former deputy governor of the Bank of Canada, said markets were heading for much higher long-term borrowing costs. These would come from ageing populations, fractious geopolitics and costs associated with the energy transition, he said.

    “We think 5.5 per cent long-term 10-year yields in the US is the level that seems consistent with the macro backdrop in the next five years,” Boivin told the Financial Times. “It’s also consistent with the compensation for risks that bond investors should require to invest in long-term bonds.”
    …

    1. “BlackRock says it sees ‘inflation on a rollercoaster’”

      Not the fun kind, I assume?

      “We think 5.5 per cent long-term 10-year yields in the US is the level that seems consistent with the macro backdrop in the next five years,”

      More Treasury bond CR8R to come?

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