The mood around here this week is less than good. As with all businesses once the government comes knocking at the industries door everybody holds their breath.
In the 1960's my father was in the trucking business owning a freight agency. Today, that is a fools business or a one room operation in a trucking company but before De-regulation my father in Los Angeles operated a 120 door loading dock and made money by the boat load.
So I guess government can cut both ways.
I can not talk directly about my business as I am bound by agreements, how ever I can comment about public events that relate to the REO debacle in the USA.
I see from many main stream sources that the attorney generals of many states have discovered that pooling and sercuritization rules were violated as well as every local and state law regarding the transfer for property via assignments on the books.
The media is making patty cakes and playing it down, but you should know that deep in you gut somewhere something is very very wrong and I have the same feeling. Each day I come in and get to sorting and selling. We do little buying these days.
The economists I track are not the ones you see on Bloomberg or CNBC and these men and women are pointing to factors that will reduce the values of all US Real Estate regardless of location and class or type by a minimum of 19 to 25%.
I have a son that is 16 and this problem of over all real estate depreciation is likely to still be with us after he is able to take a legal drink of booze. My mother lives on a fixed income and I have reviewed her holding as well as my and my wife's and we all have investments that are related to RMBS, CMBS and CDO's. So I have a family that is at risk of serious impact should the the banks I work for kick this can down the road.
I recommend that you call your congressperson, governor, and senator and demand that the banks make whole the investors, retirees, pension funds and bond holders to which they knowingly sold trash and called it gold.
Now one tid bit of FYI there are in 5 holding companies not controlled by a GSE that are holding 135,000 single family homes across the nation. These homes have been sitting for months and we were told in June that they would all be sold off by end of year.
Only 30,000 were sold and the every same holding companies today still have the same 135,000 homes in them. Supply is increasing and sellers are not selling. This business is about to explode or the national economy blow up instead. The time has come to demand the banks and GSE sell off or the government must step in and take over the banks via the reconveyance trust NOW!
Friday, October 15, 2010
Friday, July 16, 2010
No Body knows what is happening NoW
Greeting all and one month later I have the time and the focus to put a note in the Internet.
Did you see the market today, all sellers and no buyers I wonder why! 260 points down!
If you are attempting to buy REO Tranches and for the past year fell on hundreds of intermediary consultants that provide tapes and NCND/MFA's but never got anything well that may be about to change.
{There is a disturbance in the Force Luke} and mean a massive one. After years of the Government's gorging on the bad assets of the banks a vomiting event may come about.
By my limited and very narrow view of the business the Federal Government has a hunchback called the QuasiFED doing it's massive consumption and today QuasiFED is about to either burst or Vomit.
You see when you tell the public that you will buy as they did at the QuasiFED a total of ONE Trillion Dollars worth of triple A assets (wink,wink,nod,nod) from the corporate banking titans and it turns out that there is pitiful cashflow return and the assets are worst than penny stock.
You Vomit them up and sell the evil smelling brew to the vulture class.
And is the Vulture class ready, Yeah Baby they are but they have no idea (save a few) how deep and dark the belly of the QuasiFed is and this is question.
Can the Vultures of the financial world now play round robin roll up (banker style) with assets they buy for pennies and work up to 95% of the current bpo.
Time will tell.
Did you know that there are coming about 4.2 million more foreclosures over the next 18 months!
What will that do to your houses value?
Good night!
Did you see the market today, all sellers and no buyers I wonder why! 260 points down!
If you are attempting to buy REO Tranches and for the past year fell on hundreds of intermediary consultants that provide tapes and NCND/MFA's but never got anything well that may be about to change.
{There is a disturbance in the Force Luke} and mean a massive one. After years of the Government's gorging on the bad assets of the banks a vomiting event may come about.
By my limited and very narrow view of the business the Federal Government has a hunchback called the QuasiFED doing it's massive consumption and today QuasiFED is about to either burst or Vomit.
You see when you tell the public that you will buy as they did at the QuasiFED a total of ONE Trillion Dollars worth of triple A assets (wink,wink,nod,nod) from the corporate banking titans and it turns out that there is pitiful cashflow return and the assets are worst than penny stock.
You Vomit them up and sell the evil smelling brew to the vulture class.
And is the Vulture class ready, Yeah Baby they are but they have no idea (save a few) how deep and dark the belly of the QuasiFed is and this is question.
Can the Vultures of the financial world now play round robin roll up (banker style) with assets they buy for pennies and work up to 95% of the current bpo.
Time will tell.
Did you know that there are coming about 4.2 million more foreclosures over the next 18 months!
What will that do to your houses value?
Good night!
Tuesday, June 8, 2010
In the Year Zero
Hi all -
I have not been able to up date this blog regularly due to some CA agreements I have signed. The only thing I add currently is the 100M up REO business is growing.
My personal belief is that the value of all real estate in the world will continue to drop until all the financial firms stop "Extend and Pretend".
Good Day!
I have not been able to up date this blog regularly due to some CA agreements I have signed. The only thing I add currently is the 100M up REO business is growing.
My personal belief is that the value of all real estate in the world will continue to drop until all the financial firms stop "Extend and Pretend".
Good Day!
Friday, December 11, 2009
Bone Crushing Fun
Today, I had the experience of a life time. I went to work got a great order from a great client and submitted it to the Seller representative with all the necessary fruit salad.
What do you think happened? NOTHING!
Yes, the order and the proof went in, and the Seller suddenly turned into the black hole of 1000 hells. 4 hours after I submit the order the VP in charge comes on the phone and tells me that they are processing the order. Sure right and I am as dumb as a stone!
Folks in this business you have 45 minute window after a signed contract order is submitted with proof documentation to get it back and if you do not get in back from the Seller with their happy little signature so you can deposit the funds in a standing escrow account you can bet every dollar you have that you are being shopped. These people were trying to find some dummy to pay more for this tranche of grade A dead smelling corpses called Foreclosed homes.
I truly despise having a Seller take my work and shop it, especially when everybody on both coasts knows the Sellers BPO's suck "ass" and are so bad that we have to go back to the "Day" to see the best house sell in those neighborhoods for the BPO on this Sellers today value list. We could call this dreaming but it really is a sign of the desperation on the part of the Sellers
But this is what it's like at the moment! Sellers of REO Assets are mad to sell at the highest price. They spent all summer selling home at 90% of their value through Real Estate Agents and wisely only offered up a 1/100th of the actually inventory they have. All in the name of reducing supply now to keep prices high today. Never mind that the bulge building up in the holding companies is swelling up so fast that the FDIC is working 7 days a week to keep up with the number of "warnings" and "Cease and Desist" orders it needs to issue.
Speaking of the FDIC did you know that there is a persistent rumor that the Real Estate Assets is has on it's books are accumulating so fast the that they can not manage it and that the management time to correct is now measured in decades. The title backlog, that is the number of properties with title clouds, BKs, Legal actions and Tax leans now represents 80% of the FDIC holding. I have to wonder if this true.
Now Back to the Seller. Hedge funds do sell product but they do not want to pay fees because they know in their bones that they are richer than all the buyer and especially the representatives and it would be a disservice to their partners to pay for services when they transact business.
You talk to a retirement fund manager and you get the same thing. Oh, Paul we do not pay more than 1 point. My response is thanks and goodbye.
Today, We spent 30 minutes on a conference call with a retirement fund and the Managers bitched about the crap tapes, and delays and broken escrows. They blamed it on the Sellers, Seller Representatives, Title companies, Lousy BPOs, and finally on the product. These are the excuses of idiots. YOU GET WHAT YOU PAY FOR ROBBER BARONS!
Have a great day, and happy weekend. On Monday I have 2 Billion in buyers money to place and I will wait from now on 45 minutes and that is all!
Monday, November 23, 2009
Out with the Flu Really Sucks
A little over a week ago I came down with a bug and today I am back at work and I can talk but not for long.
'
It is great to be back!
Now just how big is the US Housing Shadow Inventory?
'
It is great to be back!
Now just how big is the US Housing Shadow Inventory?
Thursday, October 8, 2009
The circle is closing
Over the past 24 months I have been working to get informed about the many variables related to real estate, mortgages and controlling financial institutions.
I have also talked to a number of bankers and staff about the business and each has a unique and interesting story that rarely seem to be based on avialable facts, but which does dove tail nicely with business objectives and “we be fine mantra.”
The reality is banks are doing everything they are capable of to remain in business and maintain their balance sheet health.
We have observed over two years the tireless activity on the part of the financial industry holding the line by ballooning hidden shadow inventories and creating new balance sheet columns like holding companies and Sub-performing. These banks have worked so hard and now in 2009 in the final quarter they have run out of time, due to issues beyond their control. Today, there is a wave of new selling activity building and it coming from inside the regulators offices.
100 FDIC member banks have fallen to date (more if you count all banks) and depending on who you listen to there will be another 150 to 200 banks that fail next year. The assets of the fallen are bought by a suitor the regulator has on hand but what they do not tell you is the suitor gets only the assets and almost none of the liabilities. These "assets gone bad" are now the property of the US tax payer.
It is this pool of US assets gone bad that has grown to a size and depth that now exceeds the government ability manage and is expanding beyond the GSe's ability to contain any additional future growth.
The regulators need cash now and of course they can borrow from Uncle Sam and demand advance payments from the industry but simple math based on past performance clearly illustrates the available credit and fees in the industry will not meet the requirements of the government regulators when you factor in the Commercial Foreclosures and associated bank failures to follow.
Now the Banks are no longer in control of their future! Why do I say this, because I seen into this other universe of the Giga Shadow and it already beyond vast. The banks pushed the problems out more than 2 years and in that time enough of them have failed to create a wave of assets outside of their control that will impact their businesses regardless of the actions they have used to hold the line over the past 24 months. So the old tricks will not pay any more.
To raise money is easy all you have to do is lower prices to meet customer demand until market saturation inhibits sales, of course sales can be further made by continuing to lower prices. Banks have fought this tooth and nail but now they have created their own competition.
Uncle Sams regulators need cash, They need 100 billion and just maybe this number will grow to 500 billion. So now they are creating sales platforms that have a One billion buy in. These properties in these program are and will be sold off and the impact will be felt at the Banks as property on the market will be marked to match the resale of some of these properties.
Then the Foreclosed Commercial properties will hit the resale market further depressing prices and forcing Banks to take write downs on the books. What this all means is that bottom in the market is 18 to 24 months out at the earliest.
I have also talked to a number of bankers and staff about the business and each has a unique and interesting story that rarely seem to be based on avialable facts, but which does dove tail nicely with business objectives and “we be fine mantra.”
The reality is banks are doing everything they are capable of to remain in business and maintain their balance sheet health.
We have observed over two years the tireless activity on the part of the financial industry holding the line by ballooning hidden shadow inventories and creating new balance sheet columns like holding companies and Sub-performing. These banks have worked so hard and now in 2009 in the final quarter they have run out of time, due to issues beyond their control. Today, there is a wave of new selling activity building and it coming from inside the regulators offices.
100 FDIC member banks have fallen to date (more if you count all banks) and depending on who you listen to there will be another 150 to 200 banks that fail next year. The assets of the fallen are bought by a suitor the regulator has on hand but what they do not tell you is the suitor gets only the assets and almost none of the liabilities. These "assets gone bad" are now the property of the US tax payer.
It is this pool of US assets gone bad that has grown to a size and depth that now exceeds the government ability manage and is expanding beyond the GSe's ability to contain any additional future growth.
The regulators need cash now and of course they can borrow from Uncle Sam and demand advance payments from the industry but simple math based on past performance clearly illustrates the available credit and fees in the industry will not meet the requirements of the government regulators when you factor in the Commercial Foreclosures and associated bank failures to follow.
Now the Banks are no longer in control of their future! Why do I say this, because I seen into this other universe of the Giga Shadow and it already beyond vast. The banks pushed the problems out more than 2 years and in that time enough of them have failed to create a wave of assets outside of their control that will impact their businesses regardless of the actions they have used to hold the line over the past 24 months. So the old tricks will not pay any more.
To raise money is easy all you have to do is lower prices to meet customer demand until market saturation inhibits sales, of course sales can be further made by continuing to lower prices. Banks have fought this tooth and nail but now they have created their own competition.
Uncle Sams regulators need cash, They need 100 billion and just maybe this number will grow to 500 billion. So now they are creating sales platforms that have a One billion buy in. These properties in these program are and will be sold off and the impact will be felt at the Banks as property on the market will be marked to match the resale of some of these properties.
Then the Foreclosed Commercial properties will hit the resale market further depressing prices and forcing Banks to take write downs on the books. What this all means is that bottom in the market is 18 to 24 months out at the earliest.
Thursday, October 1, 2009
If you get a list from the FDIC
Hi all:
In the last two weeks the 501c3 non-profit sell off og FDIC controlled asset is underway. Here is how you can tell if you are working with the right buyers representative for Multifamily.
1) Any contract that has more than 3 point in commission is not real and will not close.
2) You must sign a MFA and NCND before you get the approved 501c3/FDIC approved LOI template.
3) You will be advised that you may not circulate the name of or any documents samples or related information to anyone.
Here is why these three items are what they are. The FDIC contract with the non-profits does not allow any party to add costs to the sale. The total allowed commissions is 3 points. 2 points
go to the Non-profit and it's attorney and ONE point goes to the Buyer representative. Buyers representatives must be approved by the 501c3 and only these parties which consist of Lawyers, Mortgage and Real Estate Brokers which have been pre-approved are allowed to process your paper work.
All LOI's are made out to the Chairman of the FDIC and all infromation from both sides is not to be disclosed to anyone for any reason!
In the past 2 weeks my firm and the 501c3 we work for has taken more than 1000 orders. We found out today that some people in the program have violated the terms of the non-disclosure and published material and made representatiions that they are direct to the seller. These people have added 5 points for a total of 8 point. This is crazy and it makes my job harder.
The Government will not approve any broker chains period. If you are not talking directly to my firm or one of the other 6 firms that can conference call in the Non-profit asset manager. Drop it like a because you are wasting everybodies time!!
In the last two weeks the 501c3 non-profit sell off og FDIC controlled asset is underway. Here is how you can tell if you are working with the right buyers representative for Multifamily.
1) Any contract that has more than 3 point in commission is not real and will not close.
2) You must sign a MFA and NCND before you get the approved 501c3/FDIC approved LOI template.
3) You will be advised that you may not circulate the name of or any documents samples or related information to anyone.
Here is why these three items are what they are. The FDIC contract with the non-profits does not allow any party to add costs to the sale. The total allowed commissions is 3 points. 2 points
go to the Non-profit and it's attorney and ONE point goes to the Buyer representative. Buyers representatives must be approved by the 501c3 and only these parties which consist of Lawyers, Mortgage and Real Estate Brokers which have been pre-approved are allowed to process your paper work.
All LOI's are made out to the Chairman of the FDIC and all infromation from both sides is not to be disclosed to anyone for any reason!
In the past 2 weeks my firm and the 501c3 we work for has taken more than 1000 orders. We found out today that some people in the program have violated the terms of the non-disclosure and published material and made representatiions that they are direct to the seller. These people have added 5 points for a total of 8 point. This is crazy and it makes my job harder.
The Government will not approve any broker chains period. If you are not talking directly to my firm or one of the other 6 firms that can conference call in the Non-profit asset manager. Drop it like a because you are wasting everybodies time!!
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