My yoga teacher says its Alan Greenspan’s  fault. During the Clinton era he should have raised the interest rate as the economy grew. That would have stopped the bubble. He wanted things to look good and get re-elected.  Bush kept Greenspan also.

We all know economy is a combination of things. We can blame the Banks, the greed wherever it lives in politics, in the workplace, wherever.  What if it is true? What if it is not true?  Every person is trying to solve this puzzle.

I think the inventive talents in our world will lead us out of this one. What has history said about it? Build a better tomorrow. Transportation was the ticket to employment and growth. Energy ideas for transportation is the ticket yet to be played for real. Just watch the movie NETWORK. As soon as the big guys own the alternative resources we will get to have them.

We need a Hero. Actually we need the hero inside each of us to step out and lead with grace. We start with a better word than blame, and move on in this changing world.

Buyers are scrambling. They are starting to make multiple offers on forclosures. They are even not sure if there will be many REO  forclosures in the future for them.

The lender is first. Know what you can afford. This article has a section I think was noteworthy that I want people to read.

Mortgage rates remain significantly lower than six months ago. Back in August, the average 30-year fixed mortgage rate was 6.66%, meaning a $200,000 loan would have carried a monthly payment of $1,285.25. With the average rate now at 5.34%, the monthly payment for the same size loan would be $1,115.58, a savings of $170 per month for a homeowner refinancing now.

Survey Results

30-year fixed: 5.34% ¢â‚¬â€ unchanged from last week (avg. points: 0.41)
15-year fixed: 4.93% ¢â‚¬â€ down from 5.03% last week (avg. points: 0.41)
5/1 ARM: 5.37% ¢â‚¬â€ unchanged last week (avg. points: 0.45)

Bankrate¢â‚¬â„¢s national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in the top 10 markets.

For more information, visit http://www.bankrate.com/mortgagerates.

Seldom do I find authors with such good out of the box thinking. Today Michael Hiltzik wrote a great article on social security. Read it and past articles here.   www.LAtimes.com/hiltzik

His premise is that the Social Security system was maligned by the privateers as something that needed fixing. He carefully explains the merits of the system and its scandal free, workhorse ethic that has met a need for Americans since it began. Refreshing view of the old way! Naturally the nay sayers had some better potion, snake oil to sell and the stock market was so now, so new and only for today not the old way to bless one and all. They had it only for the chosen few who followed them with the intent to get a good slice of pie they could not chop out of social security.

The press is a snapshot of now- the disposable information. However, this article is well researched and presented in the business section of Thursday Feb 13 La Times and could be missed too easily by anyone off to a holiday weekend and rushing to get work done before the exit.

An influence inspired by David Langer was part of the knowledge behind his viewpoint. There are compelling reasons to think that Social Security can be relied on, improved and added to in this article. My interpretation of his finding is this, social security could be thought of as a good Dad. He is setting aside a nest egg and has not been influenced to toss it away or bet it and lose it.

I am concerned that as I leave the old thinking of too much governement it turns out that is all we can turn to. They have the money.

I look forward to an article exposing the credit card behavior of bait and switch. Someone needs to throw some light on that

Todays message to California Realtors complete m

Feb. 18, 2009

Dear C.A.R. Member,

Earlier today, President Obama unveiled the Homeowner Affordability and Stability Plan, which will offer assistance to as many as 9 million homeowners, while attempting to prevent the destructive impact of foreclosures on families and communities.

The plan contains three main components, and only applies to primary residences. The loans referenced in the plan cannot exceed Freddie Mac/Fannie Mae conforming loan limits.  I¢â‚¬â„¢ve outlined the plan in greater detail below.

The first component is directed toward homeowners suffering from falling housing prices who still have equity in their homes, but no longer have the 20 percent equity needed to refinance.  Under the plan, homeowners who have conforming loans owned or guaranteed by Freddie Mac and Fannie Mae will be allowed to refinance their homes, even if they do not have 20 percent equity left in the house. The U.S. Treasury Dept. estimates that about 5 million homeowners will be helped by this portion of the program.

The second component, known as the Homeowner Stability Initiative, is designed to assist homeowners who are ¢â‚¬Å“underwater¢â‚¬Â on their mortgages. The $75 billion initiative will bring together lenders, servicers, and the government so that all stakeholders share in the cost of the modification.  Primary mortgages would be reduced to monthly payments that do not exceed a 38 percent debt-to-income ratio, with the costs of doing so borne by the lender. The government and lender then would split the costs of further reducing the monthly payments until they were at a 31 percent debt-to income ratio. An important aspect of the initiative is that homeowners do not have to be delinquent to participate.

The Homeowner Stability Initiative also will create incentives for servicers, mortgage holders, and homeowners. Servicers would receive an up-front fee of $1,000 for every eligible modification meeting the initiative¢â‚¬â„¢s guidelines. Guidelines are scheduled to be released by March 4. Mortgage holders will receive an incentive payment of $1,500, and servicers $500, for modifications made on loans that are current but at risk of imminent default.

The final aspect of the Homeowner Stability Initiative is creating clear and consistent guidelines for loan modifications. The Obama Administration plans to work with federal agencies, banking and credit union regulators, and the private sector in order to develop loan modification guidelines that can be implemented across the entire mortgage market. While adoption of the guidelines will be voluntary for the private sector, all financial institutions receiving Financial Stability Plan assistance going forward will be required to implement the loan modification guidelines.

The government estimates that between 3 and 4 million homeowners will benefit from the Homeowner Stability Initiative component of the plan.

The third component of The Homeowner Affordability and Stability Plan is supporting low mortgage rates by strengthening Fannie Mae and Freddie Mac.  The Treasury Dept. plans to increase their Preferred Stock Purchase Agreements with both Fannie Mae and Freddie Mac from its current $100 billion in both entities to $200 billion in each. The Treasury Dept. also will continue to purchase Fannie Mae and Freddie Mac mortgage-back securities in order to help promote stability and liquidity in the marketplace.  Additionally, the Treasury Dept. will increase Fannie Mae and Freddie Mac¢â‚¬â„¢s portfolios by $50 billion, for a total of $900 billion. The Obama Administration will work with Fannie Mae and Freddie Mac to support state housing finance agencies in serving home buyers, such as CalHFA. Funding for this will not come from TARP money but from the Housing and Economic Recovery Act.

While some of the details still are being developed, such as the modification guidelines, the Obama Administration plans on using programs and funding already allocated for The Homeowner Affordability and Stability Plan and will need little legislative approval for programs under the plan.

We¢â‚¬â„¢ll keep you updated on the Homeowner Affordability and Stability Plan as more details and information become available to us.

Sincerely,

James Liptak
2009 President
CALIFORNIA ASSOCIATION OF REALTORS®
 
 

“But what gets people upset ¢â‚¬â€ and rightfully so ¢â‚¬â€ are executives being rewarded for failure, especially when those rewards are subsidized by U.S. taxpayers.”

Top business leaders often receive annual packages worth several million dollars, so a $500,000 compensation cap is striking says Ben Feller of AP Feb 4th 2009

It wont be retroactive -”it would have applied only to executives at five companies that have received so-called exceptional help: Chrysler LLC, General Motors Corp., American International Group Inc., Bank of America Corp. and Citigroup Inc.”

Americans need homes…and our country has plenty of them. If the Gov owns them so be it. They can rent now and sell later. Why not?

Wonder where all this mess really happened? Deregulation of the Banks.

Wall street and the Banks. Oversimplified but it is a fact. When the loan was sold nobody cared about it after that. It was repackaged and sold and sold and sold and all that paper is worthless now. Everyone I know wonders about the great Christmas movie of all time-”Its A wonderful Life.” (deregulation of the Power plants in California had the same disastrous effects of greed- its cosing more to get it back on track.)

We have to make our way though this and it starts by caring enough to regulate again.

 Another stimulus package? Still wondering what happened to the first one? The same urgency is here to do something and do it quickly. If the forclosed homes being held up in government mandates get unleashed we will see a financial New Orleans. The Levees holding back the rising waters will create more damage than fixing it now will ever cost.

Everyone knows this is a serious threat to a great depression. The news is fractured in another divide. Television news is an appalling “People” magazine or local car chases through the streets. The middle of America is pushing forward in only one way I know-blogging, commenting, speaking up till we can speak out!

RISmedia a real estate information leader in communication wrote today that mid February they want to vote on this package.

This is the communication:

In an e-mail sent by the Democratic National Committee, the president also urged voters to host or attend an ¢â‚¬Å“Economic Recovery House Meeting¢â‚¬Â this coming weekend, where a videotaped message from party chairman and Virginia Gov. Tim Kaine would be played to answer questions about the stimulus spending.

¢â‚¬Å“I hope to sign the recovery plan into law in the next few weeks,¢â‚¬Â Obama said in the e-mail. ¢â‚¬Å“But I need your help to spread the word and build support.¢â‚¬Â

Republicans feel they are closer to the spirit of the plan than Democrats. There is a divide- Everyone has an opinion from economists to nonpartisan Budget leaders.

Public works Democrats:

To quicken spending, Sens. Patty Murray, D-Wash., and Dianne Feinstein, D-Calif., are expected to push to increase funds available for public works projects.

Real Estate Republicans:

Republicans are taking the lead on housing, proposing a one-to-two-year government guarantee for a 4% interest rate on 30-year loans for creditworthy borrowers. Members haven¢â‚¬â„¢t yet worked out a definition of ¢â‚¬Å“creditworthy,¢â‚¬Â but GOP officials suggest it would include virtually anyone with a current loan or seeking a new one who¢â‚¬â„¢d qualify under normal lending rules.

Important real advice:

The plans ¢â‚¬Å“won¢â‚¬â„¢t reverse the current economic downturn,¢â‚¬Â said economist Mark Zandi, who advised Republican John McCain during last year¢â‚¬â„¢s presidential campaign and recently testified on Capitol Hill. ¢â‚¬Å“It will be severe, regardless. But (the stimulus) will provide a very vital boost to the flagging economy if it¢â‚¬â„¢s passed quickly, in the next few weeks.¢â‚¬Â

Also being widely discussed among Republicans is a plan to give home buyers a tax credit of up to $15,000, or 10% of the cost of a home this year, whichever is lower.

The plain fact is right before our eyes. The last package was quickly moved into the banks and the very worst thing seems to have happened. Wall street and The Banks did not move the money out into the public. They paid themselves, unheard of amounts of money 35 Million

just saw my finance advisor today. She put the persepective on the bankers payout. everyone cries over 70dollars an hour try 350K bonus

Everyone is rethinking where they are and why they are with their company, their body and their life in each new year. It’s that time. So the latest INMAN news is that people choose people over Company Brand. I wanted to explore why AGENTS choose the Brand. For me its personal. Just like the people who choose this agent over that it is people first, then the brand.  I respect the local RE/MAX  Palos Verdes EXECS offices leaders and the agents in the company.  The next major reason is TECHNOLOGY. This 6 separate offices brokerage has a Technology department. To care for 475+ agents on any given day technology is essential. It is the engine of our car.

The agent today has to drive the MLS in the fast lane. The consumer is there now in over 80% of the process of home finding. That is why this article impressed me about why I am where we can go to this department with our phone, our laptop our questions and get results…Right away. Few small brokerages can compare to what we have. Few large brokerages can compare to the leadership our Company took in developing this department. This was not luck, it was providence, the son of our broker is amazing and gifted with the talent of TECH. Its like music to him and he was born into knowing how to play it. So in short. I know what I need to be surrounded by…the best talent. My business has shown that referrals and repeat business still dominate the customers I have but it is the INTERNET that has helped me sell the Listings and Leases. Which Beach to buy in? Invest with the best in Redondo Beach, Hermosa Beach, Manhattan Beach, Newport beach they are as different as the name.  

This article is so informative on the subject.  From INMAN news Feb 3 2009.

2007 NAR Technology Survey named referrals, repeat business and the Internet as the top three lead generators. Among the least important were open houses and floor time — two pillars of the “old way.” Traditional brokerages are laboring under increasing expenses that include keeping up with technological advances, maintaining an office, and brand-recognition advertising.

In spite of brokers’ attempts to keep up with technology, well over half of the agents and associate brokers responding to the NAR Survey indicated they wanted their broker to expand the amount of technology offered. And for all of the dollars spent on promoting a brokerage brand, it is usually individual agents who are sought out — not the broker’s brand.

I invite all brokers across the country to break free from this common business model and reinvent yourselves. Brokers need to address the following items to update their business model:

• Recognize that clients follow agents, not brands;
• Become an Internet presence;
• Embrace technology;
• A virtual office is not a benefit, it’s a requirement;
• Understand the following logic: The more benefits and training you give agents, the more professional they become, the better their image is to the general public.

The brokerage model of the future must dispose of the mentality that a broker is only there to take commissions. The real estate agent of today needs to feel value for the commission taken from a hard-earned check. Brokers should exist to harbor and foster the development of a real estate agent. The image of the real estate agent needs to improve in the eyes of the general public, and that starts with the broker.

Given these needed advancements, it is my opinion that many of the independent brokers will conglomerate to franchisers who have the capital and technology in place to foster the development of today’s agents. Brokers will enjoy the same or greater profit margins and be able to provide much more support and technology at a fraction of the cost if they pursue these benefits independently.

Michael Volkin is president of Area Pro Realty.