Monday Open Thread (2010-10-18)

Here is your open thread for Monday October 18th, 2010. You may post random links and off-topic discussions here. Also, if you have an idea or a topic you’d like to see covered in an article, please make it known.

Be sure to also check out the forums, and get your word in the user-driven discussions there!

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.


  1. 1
    David S says:

    The shear density of houses for sale in one particular location within this 98027 zip code is very high. If I look closely in the Redfin aerial view I can actually see the vapors coming off of the Cedar Grove landfill and compost manufacturing heaps. I don’t love the smell of putricine in the morning. Might this be the culprit?

  2. 2
    Snigliastic says:

    RE: David S @ 1 – You should try seeing how many threads you can post that on. It gets more interesting and funnier every time.

  3. 3
    David S says:

    RE: Snigliastic @ 2 – First time was the tail end of the weekend open, which is dead, so I thought I would open Monday with it. Are you being sarcastic?

    I am surprised places even pend in there that close to a dump, for $500k+. Are these people from out of town?

    I have a 4 mile radius no go zone around it.

  4. 4
    Scotsman says:

    RE: David S @ 3

    Have you driven the area? I’ve used the dump for commercial purposes and it’s quite impressive- they cover the area they’re working every night with dirt. The smell is negligible and you’d be hard pressed to even know it’s there much of the time. I really can’t see how it would have much influence on the property values around it. That was an area that saw a great deal of activity during the bubble years though- folks wanting to move to the country, a lot of scattered spec housing, etc.

    The best part of the dump is seeing flocks of what you at first think are seagulls- until you realize they’re bald eagles- wow!

  5. 5
    David S says:

    RE: Scotsman @ 4 – I have in fact driven it and I love the county, country feel of it for certain.

    It all depends on which way the wind blows. If you happen to be downwind it is very obtrusive.

    King County legal settlements around the facility were specifically for, Odor, Vibration and Birds, and all combinations of the three. I don’t believe the settlement values were that high, only in the thousands. It may as well be a pulp mill for that matter.

  6. 6
  7. 7
    Scotsman says:

    RE: The Tim @ 6

    Well, OK, but it was more mortgage related in my eyes than global economic theory. The main point was this guy sold his house for a third of what it cost and still owed more than he could pay. . 17 years later.

  8. 8

    It’s Time for Big Nanny Government to Leave Real Estate Alone

    Article in part:

    “…Schiff believes that the government should exit the housing market completely and let prices fall to a natural level. In other words, says Schiff, the government should stop subsidizing mortgage rates with quantitative easing, stop using taxpayer-funded losses at Fannie Mae and Freddie Mac to lubricate the mortgage market, and stop enacting things like the homebuyer tax credit to encourage people to buy houses.

    But won’t this wallop the housing market? Won’t this cause many homeowners to go even deeper “underwater” and thus become more likely to just walk away. Won’t this lead to even more foreclosures?
    Yes, says Schiff. And that’s the point. This country needs more foreclosures, not fewer. We need to clear the market of “shadow inventory” consisting of houses owned by people who never should have bought them in the first place and return to fair pricing….”,%5EGSPC,XHB,URE,DRN,IYR,VNQ&sec=topStories&pos=9&asset=&ccode=

  9. 9

    This announcement on the NWMLS webpage (agent only) explains something about a lot of listings: “Please confirm that you have chosen the correct community for your listing. Community is a required field during listing input. Until recently, if you did not choose a community during the listing input process, the system would default to the first alphabetical community in the area in which you listed. The program has been changed, and you must actively choose a community from the drop-down menu before your listing will be submitted to the system. “

  10. 10

    BoA is starting back up again. So just how long was that months and months of delay? ;-)

    The numbers don’t make a lot of sense in that there are a lot more mentioned in the judicial states than the non-judicial states. Maybe it’s because the judicial take longer, or maybe because in more of the non-judicial they don’t need to do anything to “restart” most of them? I’d like to see more detail.

  11. 11

    Reading the first sentence of this news report makes me think that the Fox News reporter goes by the name Pegasus! ;-)

    “Bank of America announced Monday that it will resubmit flawed foreclosure paperwork to judges in 102,000 cases.”

    Somehow, I doubt they said that.

  12. 12
    Polly says:

    FWIW, Cedar Grove does stink. It doesn’t help that those houses in Mirrormont are a PITA to get to since Front St from I90 is gridlock every afternoon.

  13. 13
    Scotsman says:

    RE: Kary L. Krismer @ 11

    BOA has some serious problems on its hands. They are indeed resubmitting 100K+ sets of “corrected” paperwork, as well as being sued by those they sold mortgages to (securities law issue), all while losing money on their operations side. Good times ahead.

  14. 14
  15. 15

    By Haybaler @ 14:

    HMMM. Interesting.

    You can read that? I’ve never seen anyone who writes worse than Joel Connelly, until today. What’s funny is that author actually makes a claim to being able to write well.

  16. 16

    RE: Scotsman @ 13 – Per a MSM press report, the documents being filed are something they have to do to restart judicial foreclosures. I’m surprised that’s necessary, but if they did file something to stop them, they’d have to file something to start them up again.

    Also, I’m not sure they are losing money on their operations side, but between large one time charges of the past and that one this quarter, it’s getting impossible to tell.

  17. 17
    Scotsman says:

    RE: Kary L. Krismer @ 16

    From the wire:

    “Tuesday, October 19, 2010 1:50:52 PM
    Bank of America Corp NY Fed and PIMCO reportedly requesting a BAC repurchase of mortgages”

    Lots of accounting juggling, especially in loss reserves, but the reality is they’re in the hole and most likely headed deeper:

  18. 18
    Scotsman says:

    RE: Kary L. Krismer @ 15 – Are you serious? It reads very clearly to me- how about a comment on the content, which seems significant? S simple requestto “see the note” causes all heck to break loose. I sense a growing awareness and unease in your repsonses Kary. Maybe it’s time to forget real estate and polish up that law license.

    “Brian dashed off an e-mail to his bank that night—a quick post, where he explicitly said, “I want to see the loan note where it says I owe you money, or else I’m contacting my lawyer and halting payment on my mortgage.”

    The very next day, someone from Wells Fargo called them.

    Not a machine, not a customer service rep in India—an actual, honest-to-God, alive-and-kicking bank executive.

    She apologized profusely about the HAMP screw up—said that Brian and Ilsa qualified, they qualified, they qualified!, and that she would be the one to “straighten out their situation”.

    Brian and Ilsa couldn’t talk that Tuesday, when the bank executive called. And for various reasons, they couldn’t talk Wednesday either—they finally talked to the bank executive on Thursday . . .

    . . . and during those three days, it was the executive who chased them: Two e-mails to their AOL account, two phone calls on their answering machine.

    On Thursday, when they spoke, the bank executive was sweetness and light—she told them that Ilsa and Brian qualified for HAMP, that they would get refinanced, that they would not have to pay the difference in mortgage of the last three months—“Your lower mortgage rate is locked in!”

    And as to the $84 penalty fee, which had driven Brian in particular up the wall: It was waived.”

  19. 19

    RE: Scotsman @ 18 – I’m saying it’s too hard to read the link because the author cannot write a clear sentence and has a very awkward writing style. I have the same problem with Connolly. It amazes me that Connolly can make a living writing when he can’t write.

    BTW, the part you quoted started about 80% of the say into the article. If he deleted maybe 80% of the first 80% it might be possible to make it through and get to his point.

  20. 20
    One Eyed Man says:

    RE: Scotsman @ 17

    The coverage is starting to balance out from the pure plaintiff’s lawyers website spin.

    Yves Smith at Naked Capitalism put up the following article today:

    ” Wednesday, October 20, 2010
    More on Why the PIMCO, BlackRock, Freddie, NY Fed Letter to Countrywide on Putbacks Is Way Overhyped”

    The article estimates the cost to BAC of this lawsuit at 1 billion which is one months operating profit according to the Yahoo link re BAC earnings Scotsman posted yesterday. The loss exposure is obviously an estimate and has certain assumptions that may be questioned,

  21. 21
    Dirty_Renter says:

    RE: One Eyed Man @ 20
    …and BAC owns 34% of Blackrock. haha
    I’ve heard that only 1/3rd of claims are bought back and the losses from the putbacks are ~ 35%. BAC & JPM are reserving ~ $1B per quarter for said putbacks.
    From what I can gather….the problems are come mainly from the trash companies they bought in 08 & 09, re – Countrywide, WaMu, and Wachovia(for Wells). I would never buy a company on the verge of failure…reminds me of an old folksong, when will they ever learn?
    Barclays did a good job of picking apart the carrion of Lehman…AFTER BK!

  22. 22
    One Eyed Man says:

    RE: Dirty_Renter @ 21

    Its my understanding that as part of the purchase and sale of conforming loans to freddie and fannie the banks have an obligation to buy back the paper that doesn’t meet the warranties and they’ve been buying some loans back from freddie and fannie all along. I was never involved in sales of residential mortgages in bulk and never researched it. Do you know if that’s correct?

  23. 23
    Dirty_Renter says:

    Yes, BAC, JPM & WFC have been buying back loans sold to F & F all along, but the pace accelerated post bubble. At least that’s what I’ve been reading in the 8K’s, 10K’s and transcripts of the conference calls.
    When we were selling loans to Freddie, they kept us on the straight and narrow via the buyback threat…and I had no desire to walk into the President’s office and tell him we were the proud owner of a 30-year fixed rate loan.

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