The crash of the US economy has begun. Although the reasons for the now-accelerating economic fiasco have been in place for decades, the chickens are only now coming home to roost. The murder weapons used to kill the economy are "free trade," outsourcing, illegal immigration, special work visa programs, and unrestrained government spending, which have all contributed to the death of what was just a few decades ago the economic powerhouse of the world.
The balance of trade between most of our trading partners in this so called system of "free trade" is completely lopsided. For instance, the flood of products which are imported to the US just from China alone, in contrast to US exports to China, has created a trade deficit in the trillions of dollars. This sort of one-way trade is unsustainable, and if nothing drastic is done to address this situation, America's economy will be reduced to that of a third world country.
The first indicators of economic collapse have already manifested themselves in the housing industry, and the big three American auto makers. Teetering on bankruptcy, they will be the first of the large economic dominos to fall, and the rest will follow in short order. As a consequence, something on the scale of another Great Depression may be a possibility.
America has been scammed big-time over the years. The corporate wheelers and dealers, with the complicity of their bought and paid for political whores in Washington, have sold the American working man down the river, and the general welfare of the entire country as well.
Reacting to mounting criticism of the present economic status quo, the corporate crooks and their political hit men blame the miserable economic situation on their victims -- the greedy American worker, the communist labor unions, the demand of Americans to have clean air and water, and worst of all the bunker mentality of the American people to put up fences against free trade, protectionism. This unenviable anti business situation, they say, was instrumental in forcing harried U.S. corporations to locate elsewhere in more business friendly areas of the world.
Because these same corporations own most of the mass media in America, very little if any blame at all is placed upon the multi billion dollar corporations whose decisions, based entirely on greed, have set off these disastrous events in the first place.
Coinciding with the mounting economic problems of the nation is that of a growing threat to Life, Liberty, and the Pursuit of Happiness by a group of unelected conspirators who have seized control of Americas highest political office. This group of traitors, with Bush crime family member and usurper of the Office of President, George Walker Bush, has ceaselessly undermined the authority of the Constitution and laws of the United States.
Since the installation of this cabal, a series of events have unfolded not seen since Hitler's burning of the Reichstag. The attack on the World Trade Center in New York and the Pentagon in Washington DC, followed by the anthrax threat to Congress, was carefully contrived to give the Bush Cabal the support necessary to begin military operations to secure the resources of the Mideast, and to pass the PATRIOT Act and other draconian legislation, bestowing upon this illegal regime the power to spy, arrest, and torture anyone, including American citizens, they deem as enemy combatants.
With the economy failing, and the fighting in Iraq and Afghanistan continuing with no end in sight, the newly-elected Congress sits on its hands, unwilling to act. Nor are they moving to remove the 9/11 conspirators and war criminals from the White House.
This is not only a bleak scenario for the American people but for the entire world as well. Emboldened by the timidity of the new Congress, the Bush cabal is moving ahead with their plans for war with Iran, which will not be long in coming.
Although I would like to end my remarks on a positive note, at this moment I do not see anything good happening in the near future. Despite the growing disenchantment and suspicion of Bush and his policies, he and his cabal are still in firm control of the Country.
Further, it is foolish to think that after Bush leaves office, the next occupants of the White House will set things straight. This is not going to happen.
The fact of the matter is that our Government is no longer in charge of matters, but operates as a rubber stamp for those parasitic entities which have infiltrated into the core of government. In reality, policy in Washington is not determined by the wants and needs of the American people, but by the whim of the wealthy and powerful elite whose seemingly inexhaustible riches and thirst for more riches supercedes everything else. These corrupt and treasonous individuals within the halls of power will stop at nothing, including war and murder, in order to attain their diabolical ends.
We should also not delude ourselves that an economic collapse will somehow quicken the removal of the cancer which is hastening the demise of our Republic. Just as they have used the threat of terrorism to cow the people, so will they use economic failure to justify a further tightening of the screws. It is going to be a long hard struggle to rid ourselves of this evil, make no mistake about it.
I hope you are wrong, but I must admit, it is exactly that......hope......
Posted by HILANDER on :
The railroads are the first economic indicator. I read something at my away from home terminal last night about Union Pacifics earning's forcast for 4th Qtr last year. Not good. For us, intermodal traffic is down, and more and more railcars are starting to go into deep storage.
Posted by T e x on :
quote:. . . have sold the American working man down the river, . . . .
if the current trend keeps on a goin', we won't have terrorists as Public Enemy No. 1... what was that quote from JFK? no...not the "do-for-your-country"...the other big one...
anyway, ya... the worker bees are getting squeezed...HARD...with no relief in sight. Utilities? up. Fuel? up. Fee & Permits? Up. Materials? up. Insurance? up...
eg, how can a contractor give workers a raise? Overhead costs more than ever, which simply must be paid just to keep the doors open... for instance, let the bonded & insured drop, you can't even *bid* on jobs...
But how can the hands keep showing up (and I'm talking about guys n gals who long ago gave up any idea of having health coverage) when every month it costs MORE to work?
For a quickie-example, I went to the post office one recent evening about 9 to get an insurance payment postmarked for due date. Well, they no longer postmark after 8... said I could drive to D/FW Airport cuz they postmark till 10. OK... used to, that would be about a 50-minute round trip, if everything went just right...however, now traffic is such that any manner of wrecks or construction could turn that into 2 hours...cuz the gov't enticed too many immigrants (legal & otherwise) for their tax-funded roads...
Meantime, postal rates? up
Plus, they took the clocks off the wall, in an attempt to distract folk from the wait in line...
ya...even the time for service? up...
Posted by Gordon Bennett on :
Yeah, I was actually at the local post office when they came in and took the clocks down. The guy said it was "new postal regulations."
I couldn't believe it.
Posted by T e x on :
My father, a 35-year man with the Postal Service, routed the mail for Texas and Louisiana...worked his way up to the "Logistics Division" from the old Love Field terminal...
Slightly older than am I now, he got word during the Nixon era that the ENTIRE Fort Worth regional district was being phased out cuz they were gonna "streamline" the post office...told him he could request a transfer and compete for a job in St. Louis. His boss--the director of the entire region--got a similar "deal."
So that part's nothing new...
But the squeeze from all directions? I've never seen anything like it...
If it keeps going, I think the riots of the 60s (Watts, etc) will look like the good 'ol days...
Posted by bdgee on :
Well, of course, we know all that is just libetral propaganda.
Haven't you been listening to the Adminiwtration telling us the economy is the strongest eever.
Who ya gonna believe, your lying eyes or ya president?
You must be some sort of a commie.
Posted by bond006 on :
what the right wing does for you prices go up all around you your wages never go up.
People can't live so they go into debt.
And the idiot right wing says its all the working persons fault because they want a raise they cause inflation.
Notice how crime always goes up during republican administrations. espesualy if they are right wing.
The big thing is that I have had to live with after they cause all there economic carnage and crime goes through the roof the budget for the dept of corrections gets cut and the inmate population grows with people that are the victims of there economics. By the time they get out the system has turned them into real criminals that just get thrown out in the street.
For instance an inmate is released in the state of AZ with $50.00 and clothes that don't fit if he was fortunate enough to have a job in prison he would have grossed .31 cents an hour. They can have that minus anything they were charged for.
Most of these men have no support system when they get out.
So right wing kool-aide drinkers how long would you make it.
Most of them have no choice they go right back to crime to make a living
Posted by urnso77 on :
boo hoo. how about not breaking the law to begin with!
Posted by bdgee on :
urnso77,
Some day you may be faced with one of your offspring in jail on a dope charge or worse.
I wonderhow much you will still believe in that line of hatred then?
Punishment is not the answer. We Must learn to allow these people to live in and amongst us without needing to knock over the corner liquor store to get money for bread and butter. Otherwise, we are forcing them to commit crimes.
Posted by urnso77 on :
Bdgee,
I just don't agree with you at all on this. Don't know what else to say. People that break the law should be punished. Grow up a responsible citizen, obey the law, and pay your taxes and you'll be fine. I'm not about to make up excuses for scum that deserve to be locked up.
Posted by glassman on :
quote:Originally posted by urnso77: Bdgee,
I just don't agree with you at all on this. Don't know what else to say. People that break the law should be punished. Grow up a responsible citizen, obey the law, and pay your taxes and you'll be fine. I'm not about to make up excuses for scum that deserve to be locked up.
hmmmm....
how about people entering the country illegally?
i'll tell you what else is getting me mad right now..
i own a house i can afford... all these idjits that bought more house than they can afford are gonna get Federal'rState money? to subsidize their damn mansions? i guess i screwed up by not buying something i can't afford huh?
Posted by jordanreed on :
urnso... a few laws that i break,, prolly you do too... should we be punished?..
what about that illegal federal income tax, thats used to pay off the interest to that private federal reserve bank, that is owed by who knows who? ..private individuals..thats who...not the federal government..theres no law saying you have to pay,, but if you dont?? try it sometime
Posted by rimasco on :
Easy Glass, dont get on the illegals....alot of people on this board believe that they have the right to SNEAK across the border with god knows what in their anal cavity.....Must be nice to be invisible.....
Anybody else seem to notice that they seem to be coming over even more now...makes sense...while discussions on the topic are endlessly bogged down why wouldnt they race over ASAP....JUST IN CASE
kind of like the discussions on this board.....
Posted by urnso77 on :
The illegals should be deported. And people getting subsidies for that crap is irritating. The people that don't over extend themselves (you know the responsible ones)should be the ones with the tax breaks and such. I bought a condo in a not so good area because I couldn't afford one in the nicer areas. Makes me mad too man.
Posted by T e x on :
"Grow up a responsible citizen, obey the law, and pay your taxes and you'll be fine."
well, no... there's lottsa responsible folk obeying the law and doing their best to pay taxes who are in fact...not fine at all.
Posted by glassman on :
comeon Rim, the discussion here, (if nothing else) shows just how blurred the conservative VS liberal lines get when you shift from one topic to the next...
the ulra-right winger$ want the illegals to hire (dirt cheap and without benefits) while the ultra-liberals want them to be allowed to vote.
the ulra-right winger$ want the mortgage bail outs cuz they are the ones that made the no-paperwork high interest loans that NOBODY can afford (profitable) while the ultra-liberals feel sorry for all the "poor people" that can't save enough money to buy a house...
how many mansions will get bailed out directly (or indirectly because the loan officers will not be held accountable for their ultra-greeedy BAD professional decisions??) alot i bet...
me? i want my shot at buying one of those mansions on the foreclosure market cuz i have been Conservative and am ready to act when the FREE-market makes it possible... Posted by bond006 on :
Breaking the law has always been here and always will be .
As for being pinished they areand believe me it is over kill.
If you don't understand if you are broke have no place to go and $50.00 dollars what are you going to do after you buy a meal and get a cheap room for the night.I spose your right wing answer in just get in your new suv and collect your unemployment insurance. And enjoy your freedom and the good life
See you back inthe joint in a few months and the AZ taxpeyer is back to paying $26,000 per year again to lock you up.
Nice going not everybody in prison is there for violence.
victims of drugs and that includes alcohal.Non payment of child support.
After you serve your time your debt is supposed to be paid in full try to find employment after you have done hard time who wants you around.
So excons usually take care of there own but they can't handle enough of them.
I can give you hours and hours why our system does not work and never will. And that would come as a person with first hand experience with the system from a guard to an asst.warden but you would not like facing the reality of the sittuation
The only thing I can Tell you is that we create repeat offends at a larger number than anybody in the 1ST WORLD, and it is all done in the name of punishment.
Posted by urnso77 on :
"victims of drugs and that includes alcohal"
No they are not victims. No one forced them to drink or do drugs. That was a stupid decision on their part.
And finding a job after doing hard time should be difficult. Who would want to hire someone that was in jail? You pay for the decisions you make in life. If mcdonalds is the only place that will hire you after prison, then find a way to make it work on a mcdonald's salary.
Posted by glassman on :
Martha Stewart got a pretty good job after jail?
Posted by rimasco on :
Far-left Ultra-right im sick of the whole thing! Its funny to see politicians campaigning and fund raising 2 years before an election...Heck, Hillary started before the last election was even over. Then these crooks are skewed in the decision making process due to ear-marks and contributions.
One thing I agree with Bill Maher on is...eliminate the fund raising and lets have a real campaign
Posted by Gordon Bennett on :
urnso77, have you ever broken a law? (Whether you were caught or not...)
Posted by bond006 on :
See what I mean read these posts one says you don't deserve to make a living and the other says a high profile person is an example.
The both of you if you have the time should get involved in some volunteer work with these people it would be the best thing you have ever done for your community.
Of course you can do nothing let it grow worse and complain.
Have you ever had a beer and drove one can ,give you a dui or dwi what ever state you are from. Have you ever had a photo radar ticket and not responded. Its possible you could be my guest for a while
Posted by bond006 on :
And believe me I am no bleeding heart I just know what works and what does not and besides the army I have taken care of you people mistakes and you just keep on repeating them over and over.
Keep it up I have seen it over and over your day in the barrel just may come taht is what it takes to open somebody eyes
Posted by glassman on :
bond i agree with your points... my point was that the justice system is tilted for the the wealthy, coming AND going...
Posted by Gordon Bennett on :
Whether they admit it or not, EVERYONE on this board has broken a law at some time in their life.
The lucky ones weren't caught, that's all...
Posted by bond006 on :
Sorry I miss took that for a sincere example I should have known better.
Posted by glassman on :
quote:Originally posted by bond006: Sorry I miss took that for a sincere example I should have known better.
my fault IMO, i often post facetiously without making it clear...
Posted by rimasco on :
I cant believe you guys are arguing the penile system....well here goes. I agree with glass where the system is tilted in favor of wealth... Furthermore Ive had more friends go through the system then i could count....some had support when they got out and some are just GREEEEEEEEEDY.....but all vow NEVER TO GO BACK
As far as how well the system works.....its basically like college for criminals...you get to room with a bunch of guys and learn what they DIDNT get caught for
Posted by bond006 on :
Rimasco, I do understand the way you feel.
The penile system is vary important part of our society and as to how well it functions affects the quality and safety of everybody in the country.
And it is a pure failure here and more so now with all the budget cuts wait tell we try to keep order with a staff 20% less than we have had in the past.
Posted by Gordon Bennett on :
O.J. Simpson would be in prison for life (or dead and buried) were it not for his wealth and fame.
Posted by urnso77 on :
"O.J. Simpson would be in prison for life (or dead and buried) were it not for his wealth and fame"
WARNING WARNING...I agree with Gordon...
Posted by Lockman on :
quote:Originally posted by Gordon Bennett: O.J. Simpson would be in prison for life (or dead and buried) were it not for his wealth and fame.
and the correct jury!
Posted by Gordon Bennett on :
We're all criminals, urnso77...
quote:Originally posted by urnso77: WARNING WARNING...I agree with Gordon...
Posted by rimasco on :
Bond, Im not being sarcastic but, Which country has a model system as good reference.
Maybe our system is too leaniant? From what i understand Iraq had like a 0 crime-rate pre-invasion......now that was a joke.
Hey off the topic but does anbody here believe Ken Lay is alive? My friend happend to mention it and I couldnt really bring myself to say "thats outrageous"
Posted by bond006 on :
Italy, and France are the two countries with the less repeat criminals.
Iraq system was just shoot them if you need more space
Posted by glassman on :
Hey off the topic but does anbody here believe Ken Lay is alive? My friend happend to mention it and I couldnt really bring myself to say "thats outrageous"
i beleive that if ANYBODY could pull that off? Ken Lay could....
Posted by Gordon Bennett on :
Are you talking about criminals like murderers and rapists?
Or "criminals" like people who forget to wear their seatbelts or who occasionally drive too fast?
Posted by Gordon Bennett on :
Or, for that matter, maybe you mean "criminals" as in people who smoke pot to help ease some of the pain of their cancer?
Posted by bdgee on :
quote:Originally posted by urnso77: Bdgee,
I just don't agree with you at all on this. Don't know what else to say. People that break the law should be punished. Grow up a responsible citizen, obey the law, and pay your taxes and you'll be fine. I'm not about to make up excuses for scum that deserve to be locked up.
I didn't expect you to agree, just like I don't expect my dog to agree with me on the importance of political matters. I love the cuss anyway.
You need to understand that your failure to understand or agree amounts to exactly that, your failure. It is not mine.
Posted by bdgee on :
Criminals, you know, really bad guys, like the guy doing hard time in Arkansas for diddling his 16 year old high school steady when he was 17.
Hell, they shoulda hung the creep on the town square at high noon.
Posted by bond006 on :
One of the reasons they do a better job is the way they seperate the type of criminal and the speed that they do it with.The extreme never get out and it is very hard for certian types of sex offenders to ever get out right along with the very violient.
Once a person has done there time it is easier for them to get a job and a place to live.
If a person shows the right attitude and behavior and his crime is of a certain nature. He or her can go to a job every day as long as they are back at night.
What works for them might not work for us but we do have to change
Posted by bdgee on :
quote:Originally posted by bond006: One of the reasons they do a better job is the way they seperate the type of criminal and the speed that they do it with.The extreme never get out and it is very hard for certian types of sex offenders to ever get out right along with the very violient.
Once a person has done there time it is easier for them to get a job and a place to live.
If a person shows the right attitude and behavior and his crime is of a certain nature. He or her can go to a job every day as long as they are back at night.
What works for them might not work for us but we do have to change
YES!!
The stattus quo has repeatedly proved to be a failed system.
Posted by Gordon Bennett on :
A system that treats pot smokers the same as rapists is not worth our tax dollars.
Posted by glassman on :
quote:Originally posted by Gordon Bennett: A system that treats pot smokers the same as rapists is not worth our tax dollars.
aw,comon man, you know every pot smoker is thinking they need to rape, adn commit murder and mayhem on a Ding-Dong or a Twinkie as soon as they put the bhong down... Posted by Gordon Bennett on :
And don't forget, they might just vote if they aren't classified as criminals! (Tomorrow... when they can stand up... that is...) Posted by Gordon Bennett on :
Back on the "bleak" topic....
Subprime Mortgage Collapse Eviscerates California Headquarters
By Daniel Taub
March 28 (Bloomberg) -- The words ``New Century'' used to flash several times a day on caller ID at Taleo Mexican Grill in Irvine, California, where diners wash down Salmon Veracruz with $7 hand-shaken margaritas. Reservations were often for 10 or more.
Not anymore, said Nic Villarreal, the owner of the restaurant, located two blocks from New Century Financial Corp.'s headquarters. ``We don't get any.''
In Irvine, where just nine months ago office vacancies approached a three-year low, home prices were at an all-time high, and unemployment was less than the national average, at just 3.6 percent, the unraveling subprime mortgage market is ruining the recent prosperity.
Hometown lenders including New Century and Ameriquest Mortgage Co. already have fired more than 3,000 people, house and condominium prices are down 17 percent since June and office vacancy rates are poised to double this year, said John McDermott, regional manager for Orange County at commercial real estate broker Sperry Van Ness.
``It's a huge engine that has been shut off,'' McDermott said. ``I don't know where the new influx of jobs are if you take the lending market out of the equation.''
At Phillips Auto in nearby Newport Beach, California, no one from the mortgage industry is shopping for Porsches these days, said Theresa Seradsky, the dealership's general sales manager. Instead, they're putting their Porsches up for sale through the consignment program, she said.
No Buyers
``Two years ago, every other day we had somebody coming in to buy,'' Seradsky said. ``In the last two weeks, we've had nobody.''
New Century, Irvine's second-biggest employer, may be forced to seek bankruptcy protection after the lender to people with bad or limited credit said New York-based Morgan Stanley and UBS AG of Zurich were among the companies that cut off access to $17.4 billion of credit lines. New Century is supposed to be the anchor tenant of an almost-complete, 20-story office tower being built by Maguire Properties Inc.
``We don't have any comment on industry rumors or speculation,'' said New Century spokeswoman Laura Oberhelman. ``There has not been a bankruptcy filing.''
The collapse of the subprime industry probably will affect everyone from printer-paper suppliers to office-maintenance companies to retailers who depend on employees of lenders including New Century for sales, said Jacquie Ellis, president of the Irvine Chamber of Commerce. Before its collapse, New Century had 7,400 employees, compared with 8,600 at the University of California, Irvine, she said.
`Massive Layoffs' Coming
``There are going to be massive layoffs and maybe something worse than that,'' Ellis said. ``You wonder what impact it's going to have on other companies as well.''
Cracks in the mortgage market began to appear last year. U.S. subprime borrowers fell behind on their payments at the highest rate in four years during the fourth quarter, according to data compiled by the Washington-based Mortgage Bankers Association.
The Center for Responsible Lending in Durham, North Carolina, expects the foreclosure rate for subprime loans to exceed 22 percent in California metropolitan areas including Irvine, Merced, Bakersfield, Vallejo-Fairfield, Fresno, Stockton, Santa Ana, Anaheim and Riverside.
Half of the 20 biggest U.S. subprime lenders are in California, including three in Irvine, and about 13 percent of the nation's subprime loans are in the state, according to the Washington-based Mortgage Bankers Association and industry newsletter Inside Mortgage Finance of Bethesda, Maryland.
More than two dozen mortgage lenders have closed or sought buyers since the beginning of the year. Irvine-based People's Choice Home Loan Inc. filed for bankruptcy protection last week. H&R Block Inc. is trying to sell its Irvine-based Option One Mortgage Corp. unit. Accredited Home Lenders Holding Co., based in San Diego, has offices in Irvine, and Ameriquest is based in Orange, just north of Irvine.
Home Prices Fall
For Irvine's 190,000 residents, the median price for new and resale houses and condominiums was $641,500 in February, down 17 percent from last June's peak of $775,000, according to La Jolla, California-based DataQuick Information Systems. The city's median home price is still almost triple what it was a decade ago.
New buildings with about 2.5 million square feet of space are set to open this year in Irvine, which may boost the city's vacancy rate to about 22 percent from 11.2 percent now, according to a Sperry Van Ness analysis of data from CoStar Group Inc. The rate was at 7.9 percent, close to a three-year low, as recently as the third quarter.
Office Vacancies
Increasing delinquencies in the subprime market may be hardest on Irvine's biggest office owners including closely held Irvine Co. and Los Angeles-based Maguire Properties, which last month agreed to pay $2.88 billion for 22 office complexes in Orange County and two in downtown Los Angeles that Blackstone Group LP acquired in its February takeover of Equity Office Properties Trust, Sperry Van Ness's McDermott said.
New Century leases about 267,000 square feet of space in two buildings at Maguire's Park Place project in Irvine, and agreed to lease about 190,000 square feet, or more than a third, of the space at the new 20-story office building that Maguire plans to complete in the third quarter.
Maguire has said New Century's leases at existing buildings and the new site are at below-market prices and could be replaced at higher rates. Maguire also is trying to sell 11 Orange County properties with about 3 million square feet of space that were formerly Equity Office sites.
Bill Flaherty, senior vice president of marketing for Maguire Properties, said while it may be ``a little choppy in '07,'' even with a worst-case scenario of subprime companies abandoning space, Orange County still will have an office vacancy rate of about 10 percent or 11 percent.
`Some Chop'
``At 10 percent, we're building in those markets, as are our competitors,'' Flaherty said. ``That doesn't mean there won't be some chop, but this isn't a risk-free business we're in.''
Taleo Mexican Grill is in the same Michelson Drive retail- and-office park as Maguire's new building, and restaurant owner Villarreal had prepared for the influx of lunchtime customers from the about 600 New Century workers that would have been there. Instead, lunchtime business is down by as many as 60 people a week, he said. New Century used to call with reservations of 10 to 20 people two or three times a week.
Sales at Baguette Time, a sandwich shop across the parking lot from Taleo, are down about 10 percent in the past several weeks, said owner Mo Khataw. The shop used to get walk-in customers from New Century and made $80 to $100 deliveries to the company once or twice a week.
`Small Guy'
``We're a small guy, so even if we lose $100, $200 a day, that's a lot of money,'' Khataw said.
As recently as last year, loan officers were getting annual pay of as much as $200,000, said Charlyn Cooper, a former manager at subprime lender Secured Funding based in nearby Costa Mesa. Now they're being offered low-paying jobs in call centers.
At the California unemployment office in Santa Ana, which also serves Irvine, fliers in a rack by the door read: ``Home Loan Funding in Irvine is now seeking energetic and enthusiastic customer service representatives. While other mortgage companies are downsizing, we are hiring and expanding!!!''
``Twelve dollars an hour is not a living wage for us,'' said Jorge Perez, who manages the office. ``You can't live here and have an apartment. That's not near what you need to be making.''
Home Loan Funding Inc. representatives didn't return telephone calls seeking comment.
Ankur Kumar, 27, worked in Ameriquest's fraud-detection department from mid-2004 until last May when he lost his job as part of the company's layoffs. In his new career as a fitness trainer, he hopes to have an income of $30,000 this year, compared with more than $40,000 when he worked at Ameriquest.
`Something Risky'
Kumar lives in a five-bedroom Irvine house and pays almost $3,000 a month between his interest-only loan payment and taxes. Kumar rents out three of the house's five bedrooms, which pays for about half his monthly housing expenses. The interest rate on Kumar's adjustable-rate mortgage is scheduled to go up in October. He plans to refinance. ``I'll probably have to do something risky, to be honest,'' he said.
Natalie Lohrenz, director of counseling at the Consumer Credit Counseling Service of Orange County, is meeting with about 65 people a month who are seeking help to avoid defaults on their mortgages. It was about 25 a month last year. She said she has counseled people with monthly mortgages of $4,000 and incomes of $6,000 a month.
``There are plenty of people out there living their lives with two-thirds of their income going to their mortgage,'' Lohrenz said. ``That's something we didn't see a few years ago.''
Even with New Century's collapse, some Orange County real estate brokers and landlords expect space given up by the lender and others in the mortgage industry to be taken by others.
`Resizing'
Doug Holte, western regional partner at closely held real estate developer Hines, which is building a 12-story Irvine office tower scheduled to open in May, said he expects his company to have few problems leasing space at the 266,603-square- foot site. New space, as well as sublease space put on the market by lenders, will likely be absorbed by lawyers, accountants, technology companies and others, he said. This week, Hines announced a 25,400-square-foot lease with Wachovia Corp.
``It's a resizing of an industry that had hyper growth,'' Holte said. ``We didn't really anticipate that that hyper growth would continue.''
The subprime mortgage business's roots in Orange County go back to the emergence of the area's homebuilding industry in the 1960s. Companies such as Newport Beach-based William Lyon Homes Inc. and Lennar Corp. started developing houses in the area, and the two remain among Orange County's largest homebuilders, according to an Orange County Business Journal ranking.
Savings and Loans
They in turn attracted the savings and loan industry, which provided the mortgages used to purchase homes, said Peter Navarro, a business professor at the University of California, Irvine.
After the collapse of the savings and loans in the 1980s, executives from that industry started subprime and other mortgage lenders, said Melissa Richards, general counsel for the California Mortgage Bankers Association. Their time at savings and loans gave them experience dealing with investment banks, which ended up buying packages of loans from subprime lenders for mortgage-backed securities, she said.
``You have the developers there, and you had the need for companies to get people into homes they can't afford,'' Navarro said. ``And that's how I'd describe the subprime industry.''
The 65-square-mile city of Irvine last year was named by the U.S. Census Bureau as one of the county's 10 fastest-growing cities. Once entirely part of the 120,000-acre Irvine Ranch, which was assembled through Mexican and Spanish land grants, Irvine has grown to 190,000 residents from 10,081 when the city was incorporated in 1971.
Irvine Ranch
In the 1960s, as urbanization moved south from Los Angeles County, Irvine Co., which was formed to manage Irvine Ranch, began designing master-planned communities for the land. The closely held company sells land to homebuilders who construct residential villages following Irvine Co.'s designs.
Irvine's residential neighborhoods, many in gated communities, are dense with beige-colored houses with Spanish- tile roofs, each home looking almost exactly like the one next to it. Covenants, conditions and restrictions homeowners must follow keep homes looking similar and their yards free of clutter.
The city's median home price is about 36 percent higher than the state average, according to DataQuick.
Beth Krom, Irvine's mayor since 2004 and a city council member for four years before that, said housing affordability is one of the city's biggest issues. The increase in prices has outpaced incomes, she said.
``This isn't Beverly Hills,'' Krom said. ``It's not a community where everybody is living next door to a millionaire. Many people couldn't afford to move back into their homes today.''
Ankur Kumar, 27, worked in Ameriquest's fraud-detection department from mid-2004 until last May when he lost his job as part of the company's layoffs. In his new career as a fitness trainer, he hopes to have an income of $30,000 this year, compared with more than $40,000 when he worked at Ameriquest.
that's rich...the company got rid of fraud detection personnel? sheesh...
Posted by Gordon Bennett on :
They can just write it off and us taxpayers will take care of it...
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