by Calculated Risk on 12/31/2008 02:30:00 PM

This cartoon is from 1992 ...

Click on cartoon for larger image in new window. Cartoon from Eric G. Lewis www.EricGLewis.com (site coming soon)

by Calculated Risk on 12/31/2008 11:30:00 AM

Click on cartoon for larger image in new window. Cartoon from Eric G. Lewis www.EricGLewis.com (site coming soon)

I'll be home tomorrow! Happy New Year to All!

by Calculated Risk on 12/31/2008 08:59:00 AM

From the DOL: Unemployment Insurance Weekly Claims Report

In the week ending Dec. 27, the advance figure for seasonally adjusted initial claims was 492,000, a decrease of 94,000 from the previous week's unrevised figure of 586,000. The 4-week moving average was 552,250, a decrease of 5,750 from the previous week's unrevised average of 558,000.

The advance seasonally adjusted insured unemployment rate was 3.4 percent for the week ending Dec. 20, an increase of 0.1 percentage point from the prior week's unrevised rate of 3.3 percent.

The advance number for seasonally adjusted insured unemployment during the week ending Dec. 20 was 4,506,000, an increase of 140,000 from the preceding week's revised level of 4,366,000.

Although the data is seasonally adjusted, I'd discount the decline because of the holidays.


Note that the total insured unemployment is now over 4.5 million for the first time since 1982.

by Calculated Risk on 12/30/2008 06:43:00 PM

From the NY Times: A Renter’s Market for Manhattan Offices

Even to industry veterans who have lived through other downturns, the precipitous decline in the Manhattan office market, especially in Midtown, has been startling.

“We have fallen further faster than any time in the last 20 years,” said Mitchell S. Steir, chief executive of Studley, a national brokerage firm that represents tenants. “There has been more damage to real estate values in the last four months than in any other four-month period. The pace with which it has occurred has been astonishing.”
...
[B]rokers say that actual rents have fallen much further than the data suggests. Studley said that the asking rents for 40 percent of the spaces included in its research are listed as “negotiable.”

“No one knows what the rents are, because there has been very little activity for the past three months,” said Ruth Colp-Haber, a partner at Wharton Property Advisors, which represents small to medium-size tenants. “No one is paying attention to the asking rents.”
...
[A]ctual rents have slipped as much as 25 percent since the summer, said Mitchell L. Konsker, a vice chairman of Cushman & Wakefield.

And the market will probably be flooded with sublease space in 2009.

by Calculated Risk on 12/30/2008 02:30:00 PM

A few more vacation days ... I'll be back soon.

Hopefully next week I'll be moving to the new JS-Kit commenting system. This should help with improving the quality of the comments. For those interested, check on Mish's site.

Intermittent posting continues ...

Best to all

by Calculated Risk on 12/30/2008 11:32:00 AM

From the NY Times: Breaking Up Is Harder to Do After Housing Fall

With nearly one in six homes worth less than the mortgage owed on it, according to Moody’s Economy.com, divorce lawyers and financial advisers around the country say the logistics of divorce have been turned around. “We used to fight about who gets to keep the house,” said Gary Nickelson, president of the American Academy of Matrimonial Lawyers. “Now we fight about who gets stuck with the dead cow.”

I know a couple with this problem - no one wants the house.

by Calculated Risk on 12/30/2008 09:00:00 AM

From the WSJ: Case-Shiller Index Shows Sharpest Home-Price Declines in Sun Belt

Home prices continued to drop as the economic downturn deepened further in October, according to the S&P/Case-Shiller home-price indexes, a closely watched gauge of U.S. home prices, with home prices in the Sun Belt continuing to be hit hardest.

"The bear market continues; home prices are back to their March 2004 levels," said David M. Blitzer, chairman of S&P's index committee. He added that both composite indexes and 14 of the 20 metropolitan areas are reporting new record declines. As of October, the 10-city index is down 25% from its mid-2006 peak and the 20-city is down 23%, Blitzer said.

The indexes showed prices in 10 major metropolitan areas fell 19% in October from a year earlier and 3.6% from September. The drop marks the 10-city index's 13th straight monthly report of a record decline.

In 20 major metropolitan areas, home prices dropped 18% from the prior year, also a record, and 2.2% from September.

I'll post graphs on Friday when I return.

by Calculated Risk on 12/29/2008 10:08:00 PM

From the WSJ: U.S. Deepens Involvement With GMAC Move

The U.S. government Monday deepened its involvement in the U.S. automotive industry by committing $6 billion to stabilize GMACLLC, a financing company vital to the future of struggling carmaker General MotorsCorp.

In a sign that the government's role in the industry could become open ended, Treasury said late Monday it had set up a separate program within the Troubled Asset Relief Program, a fund originally designed to help banks, to make investments directed at the auto industry. A Treasury official said the new program didn't have a specific dollar limit.

In Monday's move, the Treasury said it purchased $5 billion in senior preferred equity in GMAC and offered a new $1 billion loan to General Motors so that the automaker could participate in a rights offering at GMAC. That loan comes in addition to the recent $17.4 billion emergency plan to rescue General Motors and Chrysler LLC.

The bailout expands ...

by Calculated Risk on 12/29/2008 02:30:00 PM

Some more discussion in the comments ... I'll post tonight. Posting will be intermittent for the next few days.

by Calculated Risk on 12/29/2008 11:30:00 AM

I'm hiking at the Canyon de Chelly in Arizona today. I'll post later today ...