thehousingbubble@gmail.com
Blog

A Lot Of People Are Now Underwater

A report from Barron‘s on Idaho. “It wasn’t so long ago that homes in Boise were a hot commodity. But now? ‘Nobody wants to buy a house in Boise right now, and nobody wants to sell a house either,’ Redfin agent Shauna Pendleton joked recently. The reality isn’t quite as dire: There are buyers and sellers, she said, but their numbers are greatly reduced from the frenzied days early in the pandemic, when sellers could list a house in just about any condition and sell it in a weekend. Prices in Boise climbed 67% from the start of the pandemic to their peak in 2022, then dropped as much as 13% at their trough, according to Federal Housing Finance Agency data.”

The New York Post. “The rising cost of home-owners insurance threatens to further stall a national housing market that’s already groaning under the weight of high interest rates, rising prices and surging construction expenses. It’s derailing home sales in some of the country’s strongest housing markets. It’s making condo buildings ineligible for mortgages. In Florida, Farmers pulled its insurance business entirely from the state in July, leaving as many as 100,000 policies ineligible for renewal. And the company stopped issuing new contracts in California, where an estimated 1.2 million homes are at risk from wildfires. One 200-unit waterfront condominium in Long Island saw its insurance premium more than double to $461,000 for this year, according to Orest Tomaselli, a president at lending advisory firm CondoTek.”

“There’s added consequence if condo owners can’t afford to pay up – or simply don’t. If more than 15% of a building’s owners are delinquent in their HOA payments, no unit at the property can qualify for a mortgage, Tomaselli said, citing lending rules by housing finance agencies like Fannie Mae. And in the past year, delinquencies on condo association fees have become a serious problem, said Tomaselli, who helps condo boards comply with federal lending standards. ‘Now all of a sudden, you’re seeing numbers of 12, 14, 20% of unit owners delinquent on their maintenance by more than 60 days,’ Tomaselli said. ‘For the first time in my career, I’ve seen insurance costs kill some deals,’ said Joe Hernandez, a partner in the real estate practice at Miami law firm Bilzin Sumberg.”

The Tampa Free Press. “A Florida real estate agent has pleaded guilty to three counts of bank fraud. Each bank fraud count carries a maximum penalty of 30 years in federal prison. Maria Del Carmen Montes, 46, Kissimmee, was indicted, along with coconspirator Carlos Ferrer, on July 20, 2022. According to the plea agreement, Montes, coconspirator Ferrer, and others created and executed a mortgage fraud scheme targeting financial institutions. Montes assisted clients with purchasing homes and after signing the real estate contract, referred her buyers to a loan officer at a mortgage company.”

“In order to qualify her clients for mortgages loans for which they were unqualified, Montes transferred the personally identifying and financial information of her clients to Ferrer and directed Ferrer to create fictitious paystubs and W-2s showing false earnings and length of employment for her clients knowing that her clients never worked for the companies on the fictitious employment documents. After Ferrer created the documents, Montes submitted the fictitious paystubs and W-2s to the financial institutions who relied on them when making underwriting decisions.”

Business Insider. “Some homebuyers who decamped for the suburbs in the horrifying first months of the pandemic have come to regret their move. But as housing costs and mortgage rates hit record highs, they’re stuck. John Natale, a real-estate agent based in Wall Township, New Jersey, calls this phenomenon ‘drive till you qualify.’ He says it used to be that he could find his clients a home in their price range in whichever county they wanted to be in. Now, because prices in exurbs have swelled since 2022, his millennial clients are being priced out of anything within striking distance of New York. ‘People are adjusting one, two, maybe even three counties over just to be able to afford a house,’ he said.”

“Rafay Qamar, a real-estate agent in Chicago, says many of his millennial clients who left the city to buy homes in the suburbs in recent years are trying to come back. ‘Some of these were rash decisions because properties were moving so aggressively, so quickly. People didn’t really have a chance to shop around,’ Qamar said. ‘In about a year or so they’re like, ‘Listen, work just opened up, and this commute is terrible. We’ve got to sell it and go back to the city.’ But in this housing market, many are stuck. They can’t afford to sell their suburban homes, some of which have depreciated since the market highs in 2021 and 2022, particularly with mortgage rates so elevated. ‘A lot of people are now underwater,’ Qamar said.”

ABC 7 in California. “Last Thursday, we learned that the only Safeway grocery store in the Western Addition of San Francisco will close. Community members and those with the NAACP are speaking out, saying if this plan goes through, this will negatively impact the city’s Black community with longterm implications. Those with Safeway say they have entered into an agreement to sell the 3.68 acres site to a real estate company for a mixed-use development project, which would include housing and commercial retail space. ‘They need to really do things about taking things from the inner city that we need, and then developing housing. Housing for who? The homeless? You need to do better than that,’ said Norris Mays, who lives in the Western Addition.”

CTV News in Canada. “An investigation is underway into a two-alarm fire early Saturday in Sage Hill. At around 12:50 a.m., crews responded to the 100 block of Sage Hill Terrace N.W. where they discovered two multi-family homes under construction on fire. A second alarm was called to bring more resources to the scene. Crews used aerial ladders and platforms to limit the spread, although the fire did spread to a third unit. Conrado Rivera lives in apartment across the street and was woken up around 2 a.m. His son’s car was damaged by the heat from the fire, while the flames also impacted the outside of his apartment building. ‘How can this burn like that?’ Rivera asked. ‘I think there is no electrical there.'”

The Telegraph in the UK. “We are still a far cry from 2020 and 2021 when, amid a stamp duty holiday, buyer demand pushed house prices to rise by nearly 20pc over the period. ‘Up to around 12 or even nine months ago you could sell anything at a pretty punchy price,’ says James Farrance, associate director at estate agency Braxtons in Maidenhead. ‘And now it’s a case of ‘let’s put it on the market with something more sensible.’”

“Those looking to sell in the next 12 months will benefit from remembering the fundamentals of selling property, says Alex McNeil, partner at Bramleys estate agency. ‘It is the traditional thing which is to make sure your house is well presented and priced correctly when you go on the market,’ he says. ‘Buyers will now ignore the few houses that are on the market at unrealistic prices and particularly in the average areas. So it is important to get your price right from the start.'”

Domain News in Australia. “Owners of apartments in Sydney’s defect-riddled Mascot Towers buildings have been thrown a lifeline with an offer to cancel their massive strata debts and outstanding mortgages so that they can restart their lives elsewhere. It means most will end up bearing a financial loss on their apartments by agreeing to sell their homes to a new commercial consortium, but they would then be free of their multi-year legal nightmare. Each owner would be entitled to a percentage of the yet-to-be-determined sale price, minus the repayment of the building’s strata debt – with owners having already taken out a $15.3 million strata loan to pay for some remediation work and legal costs.”

“‘I think it’s a good arrangement,’ said one owner, university lecturer Alex Chan. ‘I know we’ll lose some money but, at this stage, I don’t care. It’s like the Titanic is going down and when someone offers you a lifejacket, you don’t turn them away.'”

From CNBC. “Zhongzhi Enterprise Group filed for bankruptcy liquidation late Friday, as the Chinese shadow banking conglomerate is unable to repay its debt amid a deepening real estate crisis in the country. The company has filed for bankruptcy on the grounds that it is ‘clearly’ lacking the ability to repay debt and has insufficient assets to pay off its dues, according to a WeChat statement issued by Beijing’s First Intermediate People’s Court. The country’s massive property sector has also been caught in the middle of a crackdown on shadow banking which was used by real estate companies to purchase land from local governments.”

“‘We do not expect a government bailout as many Zhongzhi products are non-standard wealth management products that had long been discouraged or banned by Chinese regulators; some are comparable to a Ponzi scheme,’ Zerlina Zeng, senior credit analyst at CreditSights told CNBC.”

The Wall Street Journal. “The bad news keeps coming for China Evergrande and its investors. A top executive of the beleaguered property giant’s electric-vehicle business has been detained as part of a criminal investigation, adding to Evergrande’s mounting problems. China Evergrande New Energy Vehicle said on Monday that Liu Yongzhuo, an executive director and the president of its automobile business, was being held by authorities ‘on suspicion of illegal crimes.’ It didn’t provide details or say when he was detained.”

“Liu, who is in his early 40s, joined the real-estate conglomerate two decades ago. He used to be chairman of Evergrande’s soccer club, and previously held other senior positions at Evergrande’s bottled-water business and a unit that made technology investments. He became vice chairman of the electric-vehicle company, also known as Evergrande Auto, in 2020. His detention comes months after Evergrande’s 65-year-old founder and chairman, Hui Ka Yan, was placed under police surveillance for suspected crimes. In September, police in Shenzhen also detained several employees of Evergrande’s wealth-management unit.”

“Evergrande’s Hui was once one of the world’s richest men, and his company was once the largest Chinese property developer by contracted sales. But years of aggressive borrowing and spending in sectors far beyond property helped push the developer into financial distress, and it defaulted on its international debt in late 2021. In 2021, Hui predicted that Evergrande would eventually emerge as a successful EV company with a smaller property business. But the conglomerate’s liquidity crisis has hampered its production plans, and by June last year Evergrande Auto had delivered just over 1,000 vehicles in total.”

Related Posts
This Post Has 62 Comments

  1. ‘In order to qualify her clients for mortgages loans for which they were unqualified, Montes transferred the personally identifying and financial information of her clients to Ferrer and directed Ferrer to create fictitious paystubs and W-2s showing false earnings and length of employment for her clients knowing that her clients never worked for the companies on the fictitious employment documents. After Ferrer created the documents, Montes submitted the fictitious paystubs and W-2s to the financial institutions who relied on them when making underwriting decisions’

    But, senator running deer?

  2. ‘They need to really do things about taking things from the inner city that we need, and then developing housing. Housing for who? The homeless?’

    You say that like it’s a bad thing Norris.

  3. ‘calls this phenomenon ‘drive till you qualify’ ‘People are adjusting one, two, maybe even three counties over just to be able to afford a house’

    Check!

    ‘‘Some of these were rash decisions because properties were moving so aggressively, so quickly. People didn’t really have a chance to shop around,’ Qamar said. ‘In about a year or so they’re like, ‘Listen, work just opened up, and this commute is terrible. We’ve got to sell it and go back to the city.’ But in this housing market, many are stuck. They can’t afford to sell their suburban homes, some of which have depreciated since the market highs in 2021 and 2022, particularly with mortgage rates so elevated. ‘A lot of people are now underwater’

    Double check!

  4. ‘At around 12:50 a.m., crews responded to the 100 block of Sage Hill Terrace N.W. where they discovered two multi-family homes under construction on fire. A second alarm was called to bring more resources to the scene. ..Conrado Rivera lives in apartment across the street and was woken up around 2 a.m. His son’s car was damaged by the heat from the fire, while the flames also impacted the outside of his apartment building. ‘How can this burn like that?’ Rivera asked. ‘I think there is no electrical there’

    Middle of the night in January, it’s a tinderbox for igloos Conrado.

  5. ‘Now all of a sudden, you’re seeing numbers of 12, 14, 20% of unit owners delinquent on their maintenance by more than 60 days,’ Tomaselli said.

    Another “Oh dear!” moment in time.

    1. Took me a couple readings to understand that they were talking about maintaining their insurance and HOA payments. This is pretty sad, because condos are a good option for retired people. Or, at least they *were*, before decades of deferred physical maintenance caught up with them.

  7. Monday morning. Get back to work, cattle tax slaves. Your taxes are paying to give free apartments to illegals.

    1. And don’t forget to pay off that $96 Trillion that the WWII generation unilaterally decided that you owe them.

  9. ‘Drive to you qualify’ – Property on the moon is still affordable. Its a long commute, but very little traffic.

    1. The suburban chicago commute can be awful. The suburbs extend for miles and miles in every direction but east. They all look exactly the same but you have to pay $$$ to avoid the Hispanics that pretty much take over towns. Many suburban schools are majority Hispanic now.

  10. Re: being held by authorities ‘on suspicion of illegal crimes.’

    He had little choice because legal crimes like issuing fiat (counterfeit) money are the government’s monopoly.

  11. “Prices in Boise climbed 67% from the start of the pandemic to their peak in 2022, then dropped as much as 13% at their trough, according to Federal Housing Finance Agency data.”

    If past housing busts are a guide, the trough lies five or more years out from now.

  12. BREAKING: Blackrock will be laying off 600 employees, mostly from the ESG division.

    ESG global investments collapsed by $5 trillion in just 2 years.

    ESG is the system used by Blackrock and Vanguard to blackmail companies into adopting woke practices.

    Here is BlackRock CEO Larry Fink (next to the CEO of AmEx) explaining how ESG is used to “force behaviors”

    https://twitter.com/EndWokeness/status/1744347606891819498

    1. I must have missed this, but could someone explain when/how/why Blackrock’s ESG cudgel went so wrong so fast? My understanding is that companies had a choice:

      1. Hire/promote on merits, make more profit, but Fink would remove Blackrock’s investment.
      2. Hire/promote on ESG, make less profit with less competent employees, but enjoy the Blackrock $$.

      Most companies chose Door #2 because the Blackrock trillions more than made up for any loss of profit. Why is this changing now?

  13. This S.F. Safeway is trying security gates at self-checkout kiosks to curb retail theft
    By Nora MishanecUpdated July 19, 2023 2:55 p.m.
    A security gate at a Safeway in San Francisco’s Western Addition opens after a shopper scans their receipt. The gates are one of the latest ways the grocery retailer is attempting to curb retail theft.
    Nora Mishanec/The Chronicle

    A San Francisco Safeway store has installed receipt scanners and security gates at self-service checkout kiosks in an apparent attempt to deter shoplifting.

    Shoppers using the self-service lines at Safeway in the Western Addition now have to scan their receipts on an automated plastic gate before they can exit the store. The additional security measure appears to be an attempt to prevent theft.

    “Recent changes were made at select Safeway stores in the Bay Area to maintain a safe and welcoming shopping experience for our customers and associates given the increasing amount of theft,” a Safeway spokesperson said in a statement Monday. “Those updates include operational changes to the front end of the stores to deter shoplifting. Like other local businesses, we are working on ways to curtail escalating theft so we can ensure the wellbeing of our employees and foster a welcoming environment for our customers. These long-planned security improvements were implemented with those goals in mind,” the spokesperson said.

    Reportedly rampant theft at Safeway stores and other retailers across the city have prompted merchants to beef up security measures. In recent years, Safeway’s location on Market Street in San Francisco’s Castro neighborhood installed automatic gates intended to prevent thieves from leaving the store with carts full of stolen items. Barriers around the Market Street store’s self-checkout area have also previously funneled shoppers to a single exit.

    Last year, San Francisco police said they were installing officers in various stores across the city to apprehend shoplifters, including in Safeways. In about a month’s time, police said they made about 60 arrests.

    On Monday morning, an attendant stood sentry at the gate, placing shoppers’ receipts atop a scanner that flashed green and allowed them to exit. Once shoppers passed through the gate, the plastic doors closed in a flash of blue light.

    Left unattended, the gate began to beep loudly.

    Stormy Henry said she liked the new automated scanning system. “It’s fair,” she said Monday afternoon outside the store.

    Henry, who lives in the neighborhood, said she would rather see crime prevention methods like the gate than have security guards attempt to profile potential thieves — or worse, have the store close.

    “At least it treats us equally,” she said of the new security gates. “It’s a bit much for our community, but it’s better than approaching people.”

    Henry said she used to hate shopping at the Fillmore Safeway because she disliked seeing shoppers getting accosted by security.

    “The crime makes you not want to shop here,” she said.

    But the gates make her feel more respected, she said.

    “I’m respected, I just scan it, versus them asking me as a Black woman in the Black community,” she said. “I just feel better when they ask me to scan.”

    The gate appears to be Safeway’s latest attempt to deter shoplifting and loitering at its Western Addition outpost. Last month, the store annoyed neighbors when it blared classical music overnight from a bullhorn in the store’s parking lot to discourage loitering, disrupting those living nearby and prompting a flurry of complaints. The Webster Street store also uses guards at entrances and security cameras to prevent crime.
    …
    https://www.sfchronicle.com/sf/article/safeway-san-francisco-theft-shoplift-18204454.php

    1. Bill to Stop Employees Confronting Shoplifters Passed by California Senate
      Jun 05, 2023 at 12:15 PM EDT
      By Chloe Mayer

      Lawmakers in California are hoping to push through controversial legislation that would ban retail staff from stopping thieves stealing from their stores.

      Senate Bill 553, which was submitted by State Senator Dave Cortese, has been passed by the State Senate and will now progress to policy committees in the State Assembly. Cortese hopes the proposed law will prevent workplace violence and protect staff from being forced by their employers to step-in during robberies. But some store bosses are furious about the plans, with the California Retailers Association mocking the move as an open invitation for thieves “to come in and steal.”
      …
      https://www.newsweek.com/store-retail-violence-robbery-theft-stealing-california-1804565

      1. Take home: Legalizing crime has negative economic consequences for law abiding community members.

      2. “an open invitation for thieves “to come in and steal.”

        Just like our entire southern border.

      3. “the proposed law will prevent workplace violence”

        In other words, legalize mob rule. And by “mob” I mean cosa nostra mob.

    2. I hate self-checkout. I am not a grocery store employee. Why should I be forced to act like one?

      1. For those of us who loathe interacting with people and despise small talk in any way it’s a dream come true. I shaved my head just so I don’t have to listen to pointless blather while someone is cutting my hair.

      2. Then don’t use it.

        It saves me time. I appreciate the option. Plus, it CREATES high-paid jobs — software, machinery, maintenance.

      3. I prefer self-checkout. I can bag things my way, and everyone around me is so busy checking out their stuff that they aren’t looking at what’s in my cart.

      5. So you can avoid the idiots taking forever in the checkout lines? I’m usually in and out w/ self check out.

  14. “But in this housing market, many are stuck. They can’t afford to sell their suburban homes, some of which have depreciated since the market highs in 2021 and 2022, particularly with mortgage rates so elevated. ‘A lot of people are now underwater,’ Qamar said.”

    At least they have a sub 3% 30-year mortgage to console themselves.

  15. The Telegraph in the UK. “We are still a far cry from 2020 and 2021 when, amid a stamp duty holiday, buyer demand pushed house prices to rise by nearly 20pc over the period.

    They charge was is basically a sales tax on property sales in the UK, and they still had a bubble. Yeah, the tax was suspended during COVID, but the bubble started long before that.

    Though I suppose that we also have a tax here, we just pay it to the NAR and its minions. IIRC British realtors (AKA Estate Agents) get about 1-2% commision

  16. Big Losses In Real Estate
    Angry Mortgage Podcast
    4 hours ago

    Ron reviews a number of files where Homeowners have experienced big losses in Low Rise New Construction, an ominous trend in New Condo Buildings completing construction in 2024. And utter wreckage for those who bought on Multiple Bid Homes in the outer rim of the 905 in 2021 – 2022: a real debacle.

    https://www.youtube.com/watch?v=9FQkVAQfSb8

    6:30. K-da.

  18. “…For the first time in my career, I’ve seen insurance costs kill some deals,’ said Joe Hernandez, a partner in the real estate practice at Miami law firm Bilzin Sumberg….”

    Joe Hernandez: Want some more deal killers? Property taxes, HOA dues, utilities [1], maintenance.

    Might as well find a chair and a good book. It’s going to be a long night.

    [1] Here in SoCal, we now pay an extra $17/month for the privilege of sorting food scraps into a separate bucket. That’s different from ‘green waste’ like yard trimmings, which is different from re-cycle, which is different from general trash.

    Latest news is that some OC cities are considering ‘Waste monitors’ which are folks that will sort thru your (4) buckets/barrels and fine you if your trash is not all tidy and within specification. (Gotta’ cut down on all those nasty gases produced by your leftover lettuce, ya know).

    1. Here in SoCal, we now pay an extra $17/month for the privilege of sorting food scraps into a separate bucket.

      Which will all end up in the landfill at the end of the day, like most of the stuff tossed into the big blue recycling bin.

      1. Yet another scam to justify more bureaucrats 6-figure administrative salaries and fat pensions. How about ‘SVP in charge of food waste in buckets’ for a title?

        1. Nice work if you can get it. You don’t have to actually solve any problems, you just attend meetings where the only output are “recommendations”. You can even subcontract out the collection trucks.

  19. I hear there were some giant aliens chasing people around a mall in Miami. Any of you Florida guys see that?

    1. “I hear there were some giant aliens chasing people around a mall in Miami. Any of you Florida guys see that?”

      No but I haven’t been in a mall in a decade or so.

      You did peak my interest though, this is what the mighty google had to spit out on the subject.

      Rumors Of 10-Foot Alien At Miami Mall Circulate Online—Here’s What Actually Happened

      Jan 5, 2024,0
      4:09pm EST

      TOPLINE Rumors and video clips of panic, massive police presence and what social media users claim to be an eight-to-10-foot alien appearing at a Miami mall cropped up online Friday, though the digital buzz around the supposed appearance seems to be sourced from footage of a new year’s day brawl at the shopping center that involved several juveniles and a police response.

      One low quality clip circulating on social media allegedly shows a tall alien creature walking between a dozen squad cars and an area near Miami’s Bayside Marketplace, though some users on X, formerly known at Twitter, have casted doubt on the unconvincing nature of the video.

      The scenes from the supposed appearance of the alien match up with news coverage and video footage that covered a New Year’s Day brawl at the mall that involved several fights and loud fireworks that caused a resident to report an active shooter, according to NBC South Florida, provoking a large police response.

      https://www.forbes.com/sites/antoniopequenoiv/2024/01/05/rumors-of-10-foot-alien-at-miami-mall-circulate-online-heres-what-actually-happened/

  20. ‘the company stopped issuing new contracts in California, where an estimated 1.2 million homes are at risk from wildfires’

    Controlled burns have been around for a long time. Maybe you should googwakie it.

  21. ‘There’s added consequence if condo owners can’t afford to pay up – or simply don’t. If more than 15% of a building’s owners are delinquent in their HOA payments, no unit at the property can qualify for a mortgage, Tomaselli said, citing lending rules by housing finance agencies like Fannie Mae. And in the past year, delinquencies on condo association fees have become a serious problem, said Tomaselli, who helps condo boards comply with federal lending standards. ‘Now all of a sudden, you’re seeing numbers of 12, 14, 20% of unit owners delinquent on their maintenance by more than 60 days,’ Tomaselli said. ‘For the first time in my career, I’ve seen insurance costs kill some deals’

    That’s a deja vue all over again. Remember when fannie and freddie redlined loans if a condo project was a certain percentage vacant? Now you can be fooked if yer neighbors are dead beats. Can’t get insurance, can’t get a loan. Urban living is a scam.

    1. Speaking of:

      ‘I know we’ll lose some money but, at this stage, I don’t care’

      That’s the spirit Alex, take yer losses like a man!

  24. WATCH: Team USA Proudly Sings National Anthem After Junior Hockey Championship Win

    WARNER TODD HUSTON
    8 Jan 2024

    It certainly warmed the hearts of those who saw the exuberant display of patriotism. Maybe that is why ESPN cut away from the event before the players started singing and refused to show the boys singin

    https://www.breitbart.com/sports/2024/01/08/watch-team-usa-proudly-sings-national-anthem-after-junior-hockey-championship-win/

    The Leftist response to this…

    TSN
    @TSN_Sports

    The American players singing their national anthem together after winning Gold at the #WorldJuniors 🇺🇸

    https://x.com/TSN_Sports/status/1743382680853430740?s=20

    Was this…

    https://youtu.be/rMtNM52PGn4?si=pNCPVsKx2aTjlSVa&t=14

  26. GOP Rep: Senior FBI Officials Directed Operation With 200+ Assets Disguised as Trump Supporters On Jan. 6

    by Kelen McBreen
    January 8th 2024, 1:41 pm

    Rep. Clay Higgins, (R-La.) revealed during an interview with Tucker Carlson this weekend that he has proof there were at least 200 FBI assets embedded in the crowd at the U.S. Capitol on January 6th.

    The GOP congressman claimed Deep State actors within the federal government set the stage for Jan. 6 in order to entrap thousands of Trump supporters.

    https://www.infowars.com/breaking-news/

  29. ‘We do not expect a government bailout as many Zhongzhi products are non-standard wealth management products that had long been discouraged or banned by Chinese regulators; some are comparable to a Ponzi scheme’

    This is why I’ve proposed that the guberment regulate ponzi schemes Zerlina. It’s so confusing. Sign up as a ponzi scheme and do it the right way.

      1. ‘Eventually you win’: J.K Rowling and Ricky Gervais stand up to the woke
        Sky News Australia
        1 hour ago

        Sky News host James Macpherson says J.K Rowling and Ricky Gervais have proved that if you stand up to the woke, “eventually you win”.

        Mr Macpherson said J.K Rowling’s book sales went from $7 million to $11.9 million last year, “despite the fact she was attacked by trans activists”.

        J.K Rowling has been outspoken on her views on the transgender movement, which led to her being labelled as ‘transphobic’.

        “As for Ricky Gervais, well he’s just won best stand-up comedy series at the Golden Globes.”

        https://www.youtube.com/watch?v=ZRZf4xXdJsw

        1:33.

  32. Private U.S. companies increasingly going bust as profit shrinks

    https://www.bnnbloomberg.ca/private-us-companies-increasingly-going-bust-as-profit-shrinks-1.2019106

    Private U.S. companies are seeing their earnings and profit margins collapse after the Federal Reserve’s rate hikes have lifted financing costs, and are increasingly going broke, according to a new report.

    Larger companies have been mostly insulated from the pain so far. But these corporations often use mid-sized private firms as suppliers, and the failure of smaller businesses could disrupt supply chains and boost costs for bigger enterprises, according to the report from Marblegate Asset Management and Rapid Ratings on Monday.

    “The water looks fine from the shore but what’s happening underneath the surface is a very very troubled environment that is very dangerous,” said Andrew Milgram, managing partner and chief investment officer at Marblegate.

    Any weakness among private companies could hit investors in one of the fastest growing parts of debt markets: private credit lenders. These money managers oversee around US$1.6 trillion of direct loans and other forms of private credit.

    The struggles at smaller companies could create opportunities for professionals that help companies restructure their debt and turn themselves around, Milgram said.

    Marblegate and Rapid Ratings looked at about 1,200 private companies with revenue between $100 million and $750 million, as well as about 2,230 publicly traded companies with revenue of $750 million or more.

    The private companies saw a measure of their income, earnings before interest, taxes, depreciation and amortization, fall more than 20 per cent between 2019 and 2022. At larger public corporations, Ebitda grew nearly 20 per cent on average. Profit margins contracted among the smaller companies, and expanded at the bigger firms.

    That profit pressure has resulted in more companies collapsing. Bankruptcy filings rose by more than 250 per cent in 2023 from the year before, driven mainly by smaller companies, according to the report.

    Privately held companies are more vulnerable to weakening demand, higher wage inflation, and rising funding costs, according to the report. The firms generally have less control over their expenses than their large counterparts, and many don’t have the power to pass higher costs on to customers, because competition is too intense.

    “Middle market companies have less control over prices. If you raise prices on Walmart, they’ll just find a new supplier,” Milgram said.

  34. BREAKING NEWS!

    More Americans are racking up credit card debt

    https://www.yahoo.com/finance/news/more-americans-racking-credit-card-110000397.html

    A growing number of Americans are racking up credit card debt in order to pay for their everyday necessities, a trend that may be a harbinger of economic troubles ahead, according to a new report from Bankrate.

    Findings published by Bankrate on Monday indicate that nearly half of credit card holders – about 49% – are carrying credit card debt from month to month. That marks a sharp increase from just two years ago, when about 39% of Americans with credit cards carried debt from month to month.

    More than half of Americans carrying credit card debt have done so for over a year.

    Even more concerning is that of those holding credit card debt, 10% do not think they will ever be able to pay off their bills. Another 25% expect they will pay off their debt at some point – but that it will be at least five years in the future.

    While Americans are managing their credit card debt pretty well, all things considered, we are seeing pockets of trouble at the household level,” said Ted Rossman, Bankrate senior industry analyst. “If you have credit card debt, this is probably your highest-cost debt by a wide margin.”

    The most common reason that Americans turned to their credit card was an emergency or unexpected expense, including medical bills, car repairs and home repairs. Individuals also blamed day-to-day expenses for the increase in credit card debt.

    The Bankrate survey comes shortly after the New York Federal Reserve reported that total credit card debt surged to $1.08 trillion in the three-month period from July to September, an increase of $48 billion, or 4.6% from the previous quarter. It marks the highest level on record in Fed data dating back to 2003 and the eighth consecutive annual increase.

    The rise in credit card usage and debt is particularly concerning because interest rates are astronomically high right now. The average credit card annual percentage rate, or APR, hit a new record of 20.72% last week, according to a Bankrate database that goes back to 1985. The previous record was 19% in July 1991.

    If people are carrying debt to compensate for steeper prices, they could end up paying more for items in the long run. For instance, if you owe $5,000 in debt – which the average American does – current APR levels would mean it would take about 279 months and $8,124 in interest to pay off the debt making the minimum payments.

    The rise in balances comes amid the Federal Reserve’s aggressive interest rate hike campaign as it tries to crush stubborn inflation and cool the economy.

    Although inflation has cooled considerably in recent months, it remains up 3.7% compared with the same time one year ago, according to the most recent Labor Department data.

    The inflation spike has created severe financial pressures for most U.S. households, which are forced to pay more for everyday necessities like food and rent. The burden is disproportionately borne by low-income Americans, whose already-stretched paychecks are heavily affected by price fluctuations.

  35. In a press conference on Friday, López Obrador called on the U.S. to approve a plan that would deploy $20 billion to Latin American and Caribbean countries, suspend the U.S. blockade of Cuba, remove all sanctions against Venezuela and grant at least 10 million Hispanics living in the U.S. the right to remain and work legally.

    and a partridge and a pear tree

  36. Trump says he hopes any economic crash would happen before he could serve a possible second term
    By Kate Sullivan, CNN
    Updated 1:19 AM EST, Tue January 9, 2024
    Former U.S. President and Republican presidential candidate Donald Trump attends a campaign event, in Clinton, Iowa, U.S., January 6, 2024.
    Cheney Orr/Reuters

    Former President Donald Trump predicted the US economy would “crash,” saying he hoped it would do so within the next year – before he would assume the Oval Office should he win a second term in November.

    “When there’s a crash, I hope it’s going to be during this next 12 months because I don’t want to be Herbert Hoover. The one president – I just don’t want to be Herbert Hoover,” Trump said in an interview that aired Monday on the right-wing platform Lindell TV.
    …
    https://cnn.com/cnn/2024/01/08/politics/trump-economy-crash/index.html

Comments are closed.