Mid-Week Open Thread (2012-07-18)

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Here is your open thread for the mid-week on July 18th, 2012. 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.

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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.

28 comments:

  1. 1
    ChrisM says:

    Anti-MERS ruling in Oregon:

    http://www.oregonlive.com/business/index.ssf/2012/07/in_victory_for_homeowners_oreg.html
    ruling here:
    http://media.oregonlive.com/business_impact/other/A147430.pdf

    The Oregon Court of Appeals struck a blow to the mortgage industry in Oregon today, ruling that its controversial document-registry system could not be used to skirt state recording law in out-of-court foreclosures.

    In a decision with implications beyond the Mortgage Electronic Registration Systems Inc., the state’s second-highest court also held today that a lender must ensure a complete ownership history of the mortgage on file in county records before it can foreclose outside a courtroom.

  2. 2

    RE: ChrisM @ 1 – Oregon statutory law is different in that it does require recording of assignments to take advantage of the non-judicial foreclosure procedures. Note that the court didn’t hold the deed of trust invalid, only that without those recordings a non-judicial foreclosure was improper.

    Washington has its own MERS case at the Supreme Court level, and that decision could come out any week now. Typically decisions are released on Thursdays.

  3. 3

    Interesting NY Times column suggests that maybe this housing recovery isn’t quite it’s all cracked up to be:
    http://www.nytimes.com/2012/07/15/business/for-many-home-equity-loans-payment-shock-is-near.html?_r=1&ref=fairgame

  4. 4
    sofwarenginer says:

    Senator Cantwell (D) Alleges Globalism in Seattle a Failure for Getting Skilled Workers on Board at Boeing the Last Decade

    http://www.seattlepi.com/local/komo/article/Cantwell-As-work-force-retires-who-will-build-3709079.php

    Sounds like paying decent wages and mentoring our own NW domestic Community College kids in the skills [like we did decades ago sucessfully] was too hastily trash canned by the rich elite; in the name of projected profits [now turning into economic quagmire].

  5. 5
    WaterView says:

    RE: Ira Sacharoff @ 3

    I warn all my friends and family against HELOC’s. They are a fast track to bankruptcy. I see people stipping second mortgages off homes in Chapter 13 but if it isn’t your primary residence its heading for a trustee sale. When these all balloon up it will force many to seek out HAMP.

    I know this isn’t indicative of reality but the two people I know who took HELOC’s on their homes did so to pay off credit card debt. Which to me seems crazy, you just took all your unsecured debt and secured it. It is like buying a pizza with your equity, just seems dumb.

  6. 6
    Pegasus says:

    RE: Ira Sacharoff @ 3 – It is not the only problem. Guess what? All that criminal paperwork has now come back to haunt the real estate market:

    “Our foreclosure rates remain high: however, foreclosure levels were lower than they would have been during the first quarter of 2012 due to delays in the processing of foreclosures caused by continuing foreclosure process issues encountered by our servicers and changing legislative, regulatory and judicial requirements.”

    NAR chief economist Lawrence Yun also noted that many foreclosure transactions are either getting delayed or not clearing at all due to title issues, a new phenomenon.

    “This is due to increasing legal risk,” said Yun, noting a 10-15 percent fallout rate, up from a negligible rate just months ago.

    http://www.cnbc.com//id/48243400

  7. 7
    Pegasus says:

    RE: WaterView @ 5 – You have to weigh the facts of much lower interest rates, probable tax deductibility, more flexibility, etc. In a world where most people were not in danger of losing their home it made sense for some. Nowadays, not so much but there is a chance of never paying most of the Heloc if they qualify for a short sale.

  8. 8
    WaterView says:

    RE: Pegasus @ 7

    True, I am overly conservative financially and would never profess to understand it all. I also work in bankruptcy so that colors my view towards the negative with regards to HELOCs. At my end of the economic quagmire, it sure looks like people took these out with no real understanding of the implications down the road. But that could also be because of the lax lending standards and general excitement over credit prior to 2007.

  9. 9

    RE: WaterView @ 5 – I don’t share your negative view on HELOCs, but I would fully agree that taking unsecured credit card debt and securing it against your home is a bad idea. HELOCs have their uses (if you can get one).

  10. 10
    WaterView says:

    RE: Kary L. Krismer @ 9

    For a capitol investment on a home I could probably be persuaded to think a HELOC isn’t a bad idea. But that isn’t what I have seen them used for, generally it is for the purpose of securing unsecured debt (credit cards) or buying a new toy/car.

  11. 11

    RE: WaterView @ 10
    So using home equity to buy pizza is probably a lot better than using it to buy a new car or a boat. And you don’t have to keep sinking money into that pizza.

  12. 12
    Pegasus says:

    Half Of American Households Hold 1 Percent Of Wealth

    The share of the nation’s wealth held by the less affluent half of American households dropped precipitously after the financial crisis, to 1.1 percent, according to new calculations by Congress’s nonpartisan research service.

    By contrast, the share of total net worth held by the weathiest 1 percent of American households continued rising, hitting 34.5 percent in 2010. The top 10 percent’s share was 74.5 percent.

    The bottom half’s share of wealth has declined since it reached a high of 3.6 percent in 1995. But the most dramatic drop occurred after 2007, according to the analysis of data from the Federal Reserve’s latest Survey of Consumer Finances.

    http://www.huffingtonpost.com/2012/07/19/households-wealth-american-1-percent_n_1687015.html

  13. 13
    pfft says:

    By Pegasus @ 12:

    Half Of American Households Hold 1 Percent Of Wealth

    The share of the nation’s wealth held by the less affluent half of American households dropped precipitously after the financial crisis, to 1.1 percent, according to new calculations by Congress’s nonpartisan research service.

    By contrast, the share of total net worth held by the weathiest 1 percent of American households continued rising, hitting 34.5 percent in 2010. The top 10 percent’s share was 74.5 percent.

    The bottom half’s share of wealth has declined since it reached a high of 3.6 percent in 1995. But the most dramatic drop occurred after 2007, according to the analysis of data from the Federal Reserveâ��s latest Survey of Consumer Finances.

    http://www.huffingtonpost.com/2012/07/19/households-wealth-american-1-percent_n_1687015.html

    only 50%? sounds like they need more tax cuts!

    perhaps they should protest by camping on the lawns of the poor?

  14. 14
    Pegasus says:

    RE: pfft @ 13 – Hehe I would not be surprised to see them do that. They don’t seem to get it that 90 percent of Americans are not in the club and they still vote. Their hardened stance is ridiculous in the face of the facts and figures. On the other hand Obama is passing out food stamps to non-citizens.

  15. 15
    pfft says:

    By Pegasus @ 14:

    RE: pfft @ 13 – Hehe I would not be surprised to see them do that. They don’t seem to get it that 90 percent of Americans are not in the club and they still vote. Their hardened stance is ridiculous in the face of the facts and figures. On the other hand Obama is passing out food stamps to non-citizens.

    rich people are self-important.

    “On the other hand Obama is passing out food stamps to non-citizens.”

    this is terrible. if you are a non-citizen you should starve. especially if you are a child.

  16. 16
    sofwarenginer says:

    RE: Pegasus @ 12

    And That Bottom Poor Half

    Is Seattle’s first time home buyers, whether ya like it or not.

  17. 17
    sofwarenginer says:

    RE: pfft @ 15

    Like America Can Feed the 3-4 Billion Hungry Souls On Planet Earth

    Or Pfft, do we pick and choose whose kids get to live or die?

  18. 18
    Chris says:

    RE: pfft @ 15

    Pfft: You and your propaganda. Must have gone though all your talking points to end up at starving kids. Unfortunately the poor in this country are more likely to suffer from obesity than starvation. You know that as anyone who has walked outside their house knows but the propaganda keeps on coming. Most “poor” in this country own cars, two TVs etc.

    http://www.upi.com/Health_News/2010/06/15/Poor-neighborhoods-linked-to-obesity/UPI-10841276649291/#ixzz217ANOoUv

    The study, published online in advance of print in Social Science & Medicine, finds obesity most common in children in neighborhoods having the least-educated females, most single-parent households, lowest median household income, highest proportion of non-white residents and fewest homes owned.
    ________
    http://washingtonexaminer.com/article/1098206

    Forget the image of Appalachia or rundown ghettos: A collection of federal household consumption surveys collected by pollster Scott Rasmussen finds that 74 percent of the poor own a car or truck, 70 percent have a VCR, 64 percent have a DVD, 63 percent have cable or satellite, 53 percent have a video game system, 50 percent have a computer, 30 percent have two or more cars and 23 percent use TiVo.

  19. 19
    Chris says:

    RE: pfft @ 13

    Pftt: The top 5% pays almost 60% of taxes in 2009

    http://ntu.org/tax-basics/who-pays-income-taxes.html

    Top 1% Threshold: $343,927 percent of taxes collected: 36.73

    Top 5% $154,643 58.66%

    Top 10% $112,124 70.47%

    Top 25% $66,193 87.30%

    Top 50% $32,396 97.75%

    Bottom 50% $32,396 2.25%

    I know you have some preloaded propaganda about social security payments not being factored into wage deductions but give me a break. Is that a retirement plan or just another government money grab?

  20. 20
    Pegasus says:

    RE: Chris @ 19 – Chris I think most agree that being a progressive nation that our taxes be progressive also. If the top few percent control most of the assets and most of the income, logic dictates that they would pay most of the taxes. Unfortunately that is not the case. The Social Security withholding is regressive in nature and impacts those with lower incomes more than those have incomes over the top threshold. The wealthy also don’t pay that on their other incomes like interest and capital gains. This discrepancy did not happen accidentally. Those that only make enough for subsistence survival still pay this tax. There are many other tax advantages for the wealthy and the gap in wealth is growing dramatically. Why is that happening particularly at a time when the lower incomes are bearing the brunt of this recession/depression?

  21. 21
    pfft says:

    By Chris @ 18:

    RE: pfft @ 15

    Pfft: You and your propaganda. Must have gone though all your talking points to end up at starving kids. Unfortunately the poor in this country are more likely to suffer from obesity than starvation. You know that as anyone who has walked outside their house knows but the propaganda keeps on coming. Most “poor” in this country own cars, two TVs etc.

    http://www.upi.com/Health_News/2010/06/15/Poor-neighborhoods-linked-to-obesity/UPI-10841276649291/#ixzz217ANOoUv

    The study, published online in advance of print in Social Science & Medicine, finds obesity most common in children in neighborhoods having the least-educated females, most single-parent households, lowest median household income, highest proportion of non-white residents and fewest homes owned.
    ________
    http://washingtonexaminer.com/article/1098206

    Forget the image of Appalachia or rundown ghettos: A collection of federal household consumption surveys collected by pollster Scott Rasmussen finds that 74 percent of the poor own a car or truck, 70 percent have a VCR, 64 percent have a DVD, 63 percent have cable or satellite, 53 percent have a video game system, 50 percent have a computer, 30 percent have two or more cars and 23 percent use TiVo.

    if you are hungry it doesn’t matter if you are thin or fat. It’s kind of like being rich but not having any cash.

  22. 22
    pfft says:

    By Chris @ 19:

    RE: pfft @ 13

    Pftt: The top 5% pays almost 60% of taxes in 2009

    http://ntu.org/tax-basics/who-pays-income-taxes.html

    Top 1% Threshold: $343,927 percent of taxes collected: 36.73

    Top 5% $154,643 58.66%

    Top 10% $112,124 70.47%

    Top 25% $66,193 87.30%

    Top 50% $32,396 97.75%

    Bottom 50% $32,396 2.25%

    I know you have some preloaded propaganda about social security payments not being factored into wage deductions but give me a break. Is that a retirement plan or just another government money grab?

    1. the system is designed to be progressive.

    2. people don’t pay income taxes because they don’t qualify because the rich have rigged the tax code and all the money goes to the top.

    3. those who don’t pay federal income taxes do pay a lot of SS taxes. about 40% of government revenue is from income taxes and another 40% of government revenue is from payroll taxes.

    4. taxes at the state and local level are usually very regressive.

    anything else?

  23. 23
    Chris says:

    RE: Pegasus @ 20

    Respectfully – that is not what it was intended to be nor what is stated in law:

    42 USC § 401 – TRUST FUNDS
    Federal Old-Age and Survivors Insurance Trust Fund
    There is hereby created on the books of the Treasury of the United States a trust fund to be known as the “Federal Old-Age and Survivors Insurance Trust Fund”.

    http://www.law.cornell.edu/uscode/text/42/401

    If it isn’t a retirement and disability fund, what is it?

    Regarding the capital gains isn’t it fair to say money was taxed before it was invested and the US has at worst a capital gains tax in the middle range of countries:

    http://taxprof.typepad.com/taxprof_blog/2008/10/the-us-capital-gains-tax-rate-an-international-perspective.html

  24. 24
    Chris says:

    RE: pfft @ 21

    So it’s not a “Federal Old-Age and Survivors Insurance Trust Fund”? When did that change happen? Was a law passed that did away with the concept it is a mandatory retirement and disability plan? What statute are you looking at Pftt? Are you saying people will never see a benefit after parting with their money? If so you are very cynical about the federal government. It takes money illegally from a trust fund intended for retirement and will never give anything back. Sounds like Madoff.

    42 USC § 401 – TRUST FUNDS
    http://www.law.cornell.edu/uscode/text/42/401

  25. 25
    Chris says:

    RE: pfft @ 21

    2. people don’t pay income taxes because they don’t qualify because the rich have rigged the tax code and all the money goes to the top.

    Baloney Pfft. Read the stats. The bottom 50% pays 2.25% of taxes. If the system was rigged by the “rich” they did a bad job.

  26. 26
    Chris says:

    RE: pfft @ 21

    4. taxes at the state and local level are usually very regressive.

    Like no tax on food etc?

  27. 27
    Pegasus says:

    RE: Chris @ 23 – Comparing our capital gains tax to other countries that have different taxes on other income is ingenuous at best and still does not address the fairness of giving the wealthy low tax brackets on much of their income while the lower incomes suffer.

    The Social Security Trust Fund monies have been lent out to finance boondoggles for the wealthy hence the fear that the trust will never see their money returned unless the Treasury just prints it. When established Social Security payments were never to be taxed. How did that work out with the less fortunate now having to pay taxes on their small SS payments while the wealthy dine on caviar… You don’t think there is an agenda from the rich when all you hear is that Social Security will bust the nation and this nation lent or gave trillions of dollars to bail out the wealthy?

  28. 28
    Pegasus says:

    RE: Chris @ 26 – Like cars.

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