Bad News Bears

"they can again pay top dollar for top talent"

top talent will always be scarce and well paid imho. did you see switzerland's cantons competing for the best finance people living in london? wow, i'd move out of uk towards switzerland in a new york minute if i were them. my congrats to them by the way... wherever they are. how cool is that though? to have a country send you some brochures cause they want you... nice!

so if you take the bear's reasoning that Wall Street compensation has a completely direct effect on NYC RE then we should soon start seeing record breaking prices again soon

Then Steve will argue that a guy who just got a bazillion dollar bonus at 28 years old will be more concerned with the rent to buy ratio instead of wanting to buy a phat pad at incredible prices that he can bring australian models back to do blow....

so sad to pin ur hopes on another industry to carry you through life. but yet even with this news RE prices continue to fall. the same people are getting paid. I guess when december comes and goes and lucida and isis are still vacant, we'll take another look.

Less interested in the large bonuses or bankers buying $4M apartments, but the impact of the money on the NYC economy is undeniable. More jobs, higher employment %, better incomes, all good stuff. What do you think this will do to rents?

http://www.nakedcapitalism.com/2009/10/employed-taking-deeper-pay-cuts.html

the rich tend to save a much higher percentage of their income. of course some restaurants will do much better this holiday season. but tiffany's doing better doesn't make me feel all warm and fuzzy. increasing wages for the majority, now that i would find interesting.

Unquestionably the only goodish news ever posted by JuiceMan that I remotely agree with.

But don't count your chickens. A lot is left undone - re-regulation, for one. And how bonuses are paid is critically important. And to whom: does no one look askance at a kitchen employee being paid a $7,000 "retention bonus" by AIG?

And: prices are still falling, inventories are still rising, and unemployment in NYC is over 10% and rising. Regardless of pay, the "buy and flip" mentality is gone.

Unless JuiceMan is going to post some empirical evidence that all of these bonus-takers are running out right now to buy real estate. Even if they were, credit is still tight, and bonuses are no longer counted as income, ESPECIALLY if paid in restricted stock.

http://www.nakedcapitalism.com/2009/10/aig-execs-pay-retention-bonuses-to-secretaries-and-kitchen-staff-and-renege-on-promised-repayments.html

it is so awesome to see the perma bears constantly back peddling and contradict their logic from previous posts as data continues to prove their points wrong time after time

petro, what are you talking about? you really think that diverting huge amounts of wealth and giving it to a relatively small number of people, in an industry that is not net expanding, whose members have just been on a multi-year real estate buying spree, will support all the real estate and retail in this city?

petrzitz, you're out of your mind. I've not backpedaled: I acknowledged some good economic news, though I don't entirely agree with the implied conclusion.

AR is correct - a lot of money paid to a few people is not going to save the real estate market, which is still vastly overpriced. I'm working on renting a 1200 square foot 2 bedroom 2 bathroom 2 balcony apartment in midtown for $3,600 a month. Buying the same apartment a block away would cost me $10,000 a month. There's still a long way to go - down.

i believe that the small amount of people have the same ability to lift the market if they also have the ability to collapse the market.

My thoughts on NYC RE's dependance on Wall Street incomes have been posted numerous times....

I am just calling out the doom and gloom morons

AR - It won't support it all, but it is good news for the NYC economy. That money will find its way to restaurants, retail stores, etc. That doesn't fix the economy but it is some good news.

"I am just calling out the doom and gloom morons"

As already posted, prices are down 25% to 30% from their peak. What is so "moronic" about making a prediction. I believe we have another 30% to go from current levels.

I could be wrong. But I doubt it.

easy credit lifted the market petro. to the extent that the financial types provided it they lifted the market. and they lifted those segments of the market where they directly compete in purchasing, to the extent that they live in new york and not greenwich or westchester.

but for your 1200 sf UES coop, it was easy credit all the way.

waverly, they aren't producing anything that leads to general employment. i am grateful that somewhat fewer businesses will go under because they can support them. but this is the most inefficient use of money possible.

and i'm actually kind of afraid of what news of this sort will do. there's a lot of anger out there. i had dinner last night with a couple from the house of dimon. they're really rather scared, honestly.

Petrofrizz has a vested interest in tooting this horn, because bazillionaires all want to live in tenement walkups on Pitt Street, faceless condos with greenpools on the Vegas fringes, and one-on-another beach shacks down the Joisey Shaw.

petrfitz - have you looked at any of the recent comps threads? moron!

anyway, glad to see bonus # are going to be good this year...(and yes, i still have a job)

They are going to restaurants, shows, buying things, using other services and those businesses will keep people employed and may have a need to increase hiring.

You seem to focus a lot on "producing things that lead to employment", but that is an incomplete way to view the economy since we are not an agrarian society. Yes, manufacturing brings jobs, but other industries bring jobs too. In fact, in NYC, the "other industries" bring lots and lots of jobs.

"waverly, they aren't producing anything that leads to general employment. i am grateful that somewhat fewer businesses will go under because they can support them. but this is the most inefficient use of money possible.

and i'm actually kind of afraid of what news of this sort will do. there's a lot of anger out there. i had dinner last night with a couple from the house of dimon. they're really rather scared, honestly."

scared for their safety? most employment is generated by small biz, which are getting tiny press but will eventually as most will not hire for a while. they will just hibernate to enhance chances of survival. anyway, the effects of people living paycheck by paycheck on a new environment of permanent high unemployment is gonna show soon enough. expect tax lien sales across the country within a couple of years. this recession will affect even that 30% of homeowners that don't have a mortgage (got the house for free or paid it for already). everybody is subprime now.

waverly, i'm not pro-manufacturing. i'm pro-production. i always know a lot of people in the industry, and a lot of them are very focused on saving. they view the future as filled with uncertainty.

now if someone who makes less money see an improvement in his/her income or job status, they are much more likely to spend that money.

i'm not denying that highly-paid financial professionals continuing to be highly paid, even more highly paid per capita, won't prevent some business from being lost. but it's adding very little. each highly paid individual can only spend so much.

"each highly paid individual can only spend so much."

well, most of that 70% of GDP consumption actually don't come from the middle class. top 20% account for 60% of it... (used to be at least, don't know now). it's a tricky moment for guessing what normal consumption will look like, as aspirational middle class will stop aspiring imho. who hard did they aspire during the bubble? no idea...

the spending of the rich has more velocity (as they consume more highly value added goods) so it matters a lot. but, those not rich will generate most of the credit losses at the individual level (bankrupty, REOs and the like).

admin, that's not my point. giving MORE to people who already have plenty is not a very efficient way to spur consumption.

AR - I mostly agree with you. I think you see this is not having much of an affect at all on the NYC economy and I see it as helping a little bit.

waverly, i'm just looking at it from an efficiency standpoint. i won't deny that ready access to extra cash won't encourage certain types of consumption.

AR, that's the point (when it comes to economics that is). middle class people overestimate the share of taxes they pay and underestimate the importance that the consumption of the rich has on the economy.

when it comes to the politics of wealth redistribution it's simple to me. demographically, the elderly vote more, the young don't (hence ponzi schemes are alive and kicking, kicking the can is a normal thing to do by now). social class wise, if you are wealthy just say "socialism is winning!" and your earnings will not be taxed heavily while the safety net for the needy will stay at the bare minimum. funny enough, those needy are many times the ones scare of "socialism" and the "death tax"... it's sad and funny at the same time.

admin, when people go from being unemployed to being employed, they frequently spend each additional dollar they receive.

We continue to look at homes in NJ and that market is anything but good (unless you are a buyer who can get a mortgage), loads of inventory, falling prices etc...

Alas, here in NYC I am very busy with buyers(thanks to my own version of incentive offers!) including 3 signed contracts in the last 2 months. Not bad considering I just reentered the world of "selling" real estate. Anecdotally speaking it does feel pretty good, certainly much better than last January! That doesn't mean I understand it, still all cash other than some UYG that I am finally making a little money on!

My limited personal experience with real estate over the last few months; a decent a amount of buyers (if you have a good referral stream) a ton of stuff to show with most being delusional overpriced crap, that may not trade at any price point(re:early 90's low floor/high mnt./face rear/wall=you are now a LL).

Price/location/financials/exposure/condition=sale. The folks I am working with don't want fix me ups or at least they want a significant discount which most sellers are not pricing in IMO.

Let's add "sluggish/high inventory real estate market" to the "jobless" recovery scenario?

Maybe they can pool their money to buy Stuytown. Or the 2000 apartments coming on line in downtown Brooklyn. Or one or more of the buildings in BPC. Or all of Williamsburg. Or...

JPM profits beat estimates by 60%!!!!!

malthus, you trying to suggest that my landlord's initials should change from TS to GS?

18% of the US thinks that the sun revolves around the earth
18% of the US think that the GOP in congress are doing a good job.

Coincidence?

AR: Your landlords should be doing more than changing names. I would be looking for dark shades and hats.

similar to the % of americans that cannot find USA on a map. what do these guys do for living? well... maybe they are even teachers.

"18% of the US thinks that the sun revolves around the earth
"18% of the US think that the GOP in congress are doing a good job."

And one of the US focuses excessively on hisanus.

how sad. we all waiting for the crumbs, wall streeters will be willing to throw us. That's the politics of O: compromise, giving in, withdrawal. Everyone is afraid that those people might not get the bonuses they do not deserve. No sense of honor or dignity.

"No sense of honor or dignity. "

haven't seen that in a while. why accusing obama of this? as if 1 guy could change it all? the day trying to kick the can to those unborn is made illegal along with unfunded pensions and "entitlements", bubbles are not used to get out quickly from recessions, people live within their means instead of pretending to have more than what they do... maybe... i see some dignity... it's still a wonderful world, but who is free from abusing others in this society?

"That's the politics of O: compromise, giving in, withdrawal."

I think you are giving Oprah way too much credit.

"i believe that the small amount of people have the same ability to lift the market if they also have the ability to collapse the market."

You correctly state this as a belief. Consider why you would believe any particular ability is symmetrical when we are consistently confronted by forces with asymmetrical effects. With the right tool, you can easily make someone permanently dead. Can you bring them back to life? Easily? A year later? Can you ever make someone permanently alive?

In addition to the problem of asymmetry, the economy or even one market presents a complex environment where other forces are also in play and it may be too soon to tell whether effects are long-term. I think that is essentially what the "bears" are arguing.

You already acknowledged your position is based on a belief. That is not necessarily worse than reason, just very different. Much of what we call "logic" is a rationalization of an emotional reaction and we all engage in those rationalizations, especially on real estate boards :) But before you "call out" others (and call them morons) I think you should recognize that you are not reasoning. Smart people who do not share your belief can reach different conclusions.

"why accusing obama of this?"

because he had a chance to bring some change and blew it. not even close. Glass-Steagall in place, bailouts, tax-breaks for housing, no single payer and the list goes on.

"as if 1 guy could change it all?"

nobody said could change it ALL. but isn't this why he was elected? he could have tried at least. and how come a single guy (FDR) could go against their interests? Sheesh.

trickle down is a joke
the rich (those with accumulated wealth at least nearly sufficient to live out there days without work)do not spend particularly more or less based on their current income or tax experience
the middle class (what remains of it) spends all it makes or gets based on tax cuts or whatever and the middle class often spends using leverage, cc's or heloc/refi atm
hand a centimillionaire a 500k tax cut and he spends no differently than before
hand a double income middle class family whwere one earner is unemployed a check of sorts and it is spent imeediately on luxuries like food clothing shelter and medical care

weve been in trickle up mode ,which is statistically unarguable for the last 10 years--and the rich aint spending us outta this one!!

Katie - not everything is asymmetrical therefore your symmetrical application of this logic is flawed.

The only people accusing Obame these days are the same ones who deny all this is the result of disasterous Republican policies and malfesance.

i don't see the point in arguing what measures to take now. the opportunity to prevent the bubble was there, nobody did anything but salivate about how much $ they were earning through their homes, the love of homeownership and the like craziness.

my point is that, hard to accept as it might be, sometimes there's not much to do about the situation and the whole society is to blame. this recession is nothing in comparison to the tsunami of unfunded entitlements that's coming. SS and Medicare are already in red by the way. why not talk about that? is it cause there are no few scape goats and each voter is to blame?

http://www.dallasfed.org/news/speeches/fisher/2008/fs080528.cfm

$99 trillion of unfunded SS+Medicare without counting unfunded public pensions. "This comes to $1.3 million per family of four—over 25 times the average household’s income."... now, should i hate finance people more than old folks that gave benefits to themselves with total disregard of what the young could afford to pay? they are the same, only go for what's best for them given the unreasonable incentives they have.

petro, that is not true and you know it.

well, admin, the measures we are taking now seem to be aimed at creating another bubble. so i'd say that those measures are fairly relevant.

"trickle down is a joke " totally agree. although as spending from the rich is more value added, chances are if they spend less, that drop will generate higher unemployment than if the same drop comes from teh middle class (temporary dislocation, from pet groomers to wedding planners and interior designers). it would be very welcome long term imho to get resources out of those "feel good" areas but it would be unemployment non the less.

"The only people accusing Obame these days are the same ones who deny all this is the result of disasterous Republican policies and malfesance."

Nice try sherlock. all govs are to blame for the last 30 years. However never hypocrisy and compromise despite public support and mandate was as prevalent as it is now. of course times are extraordinary but that's exactly the point.

"well, admin, the measures we are taking now seem to be aimed at creating another bubble. so i'd say that those measures are fairly relevant."

relevant? it might not be if you look at the big fiscal picture. take those that don't want the FED print money to re inflate the bubble, cause in part of the demise of the dollar. isn't it true anyway that money would have had to be printed for those unfunded entitlements that absolutely dwarf this credit crash losses? i seriously think people don't see the big fiscal picture. i don't know a single retiree or future retiree willing to have their benefits cut. they are the biggest source of votes, hence, nothing to discuss. i'm afraid they are just warming up the printers and that the serious printing was gonna come anyway.

Stocks UP for 8 straight Months.. You think it will continue forever ?? Then Buy NYC Real Estate

prices are NOT still falling. Prices are rising. My studio comps are up about 8%-9% since the end of August. stop spreading BS. Just because you bears lost out don't spread stupid rhetoric.

It is all about confidence boys and girls

"prices are NOT still falling. Prices are rising. My studio comps are up about 8%-9% since the end of August. stop spreading BS. Just because you bears lost out don't spread stupid rhetoric."

Yes, I agree. Steves fake numbers are up over his older fake numbers.

Of course, the actual stats still say Steve is a moron. Some brokerage reports said down again, some said up.... but all seem to say that average psf is down again.

Ouch, sucks to be steve.

BTW, back to the original point, I think the calculations are fairly poor.

These 23 probably represented, what, 30-35 banks last year? You can't just compare banks left standing to their previous numbers.... you have to compare BoA not to BoA but Boa Merrill.

And lehman... that doesn't hit the calculation... but the other banks have to make a lot more just to pick that up...

The more meaningful stats might be the average comp (which seems to have gone up a bit) and the total employed, which is still pretty far down...

> Stocks UP for 8 straight Months..

Certainly glad my money was in stocks the last 8 months.... and not manhattan RE (well, I'm sure my index has a reit or two)

AR: "waverly, i'm not pro-manufacturing. i'm pro-production"

which of course explains why you are a SAHM though you have a mature daughter who is at school/activities 10hrs a day, and why you are married to a corporate lawyer. Lots of production coming out of the AR household.

typical hypocrite limo liberal (redundancy intended).

Even you admit that the lower end of the market has been doing reasonably well, but the mid and high end not so well. So if the people who have done well are doing well now, isn't it likely that some of them will trade up, helping those markets?

> I am just calling out the doom and gloom morons

You mean the morons who were right and proved you 100% stupid, perfitz?

Perfitz holds the record for dumb. He said prices up in Manhattan 15% in a year last year.... and we had more than that in the OTHER DIRECTION!

whoops.

He bragged about his Lake Las Vegas "investment". The development went bust.

whoops.

getting called names by perfitz is a complement.

He's the king of idiots.

"These 23 probably represented, what, 30-35 banks last year? You can't just compare banks left standing to their previous numbers.... you have to compare BoA not to BoA but Boa Merrill."

It's actually unclear from the methodology how they're accounting for this, if at all. Your point is valid, but from what I can tell, you're assuming they're ignoring the industry consolidation.

"AR: "waverly, i'm not pro-manufacturing. i'm pro-production" which of course explains why you are a SAHM though you have a mature daughter who is at school/activities 10hrs a day, and why you are married to a corporate lawyer. Lots of production coming out of the AR household. typical hypocrite limo liberal (redundancy intended)."

wow, there's no need for personal attacks. a wife of a high earner in usa faces punitive taxes for working (include there the 15% of fica that these women would pay for nothing and working for benefits the men is already providing). it pays more to stay at home helping the kids with homework and taking on the role of ms watanabe (for example, timing well a re entrance into the RE mkt and managing the household finances/investments). that's not AR's fault, it's cause of a tax change from 1948 aimed at shifting jobs from women to those men coming back from war. it should have been updated by now... anyhow, those taxes are even worse in a high tax place like nyc.

Printer, why don't I run out today and take a job despite the fact that I don't need the income. Maybe I can keep someone who truly needs the work unemployed. Asshole. Btw the U6 is around 17 percent in case you haven't been paying attention to the numbers.

" Btw the U6 is around 17 percent in case you haven't been paying attention to the numbers. "

When has he ever paid attention to the numbers?

So start your own company - you know, produce something, and create some sorely needed jobs - as you have so thoroughly documented, U6 is disturbingly high, and we sorely need some job creation.
I'm sure capital isn't an issue, as you have all that money you made from selling your apt, and that extraordinary savings rate from renting at PCV these past few years.
And you have several fans out here on SE - I'm sure they'd do what they could to help throw customers your way in whatever venture you start.

actually printer i did. maybe you missed my comments about being a small business owner. unfortunately it was started 3 years ago in retail and it failed. right now i am writing.

not that i need to defend myself to the likes of you. just clearing up the record.

interesting! are you writing a book?... printer, how are you managing to give the most to society?

luckily i could afford the loss, and i have a supportive family, so the failure of my small business wasn't a crushing blow, just a major blow. many others can't say the same.

admin, yes, but i won't be able to pull all the pieces together until the census bureau releases its report in 2011. so i'm trying to make some reasonable assumptions, and i hope that my research and intuition wind up being correct. this may be for nothing, but it does keep me focused.

nice! no research well done goes to waste imho. you'll always find some use for it.

That was your problem - retail doesn't really produce, does it? It distributes. You need to follow your heart and produce something. And think of how many bright, talented people are out there to help you these days. This is your opportunity. try again - have you F. Scott moment.

admin - I never claimed to be another MLK. I'm just your typical American, working hard and trying my best to provide for my family, and raise good, ethical kids, involved in the typical community activities. I don't bemoan some mythical past and complain about how imperfect everyone else is compared to me, oblivious to my own warts - I just like to call out people like AR who do.

Wlamart is not a business?

Actually wlamart is not a business, but walmart iz

actually, it used to be neither.. it was wal*mart. They only changed it a few months ago.

hear you printer. we are all imperfect imho, but some more than others (i'm thinking about guys like cheney, rumsfeld or madoff, ...).

admin, in the last argument that i had with printer he/she accused me of being less than successful as a contributing member to society because i only had one child.

yes, printer, you really do stand for something different.

too funny. the rental market continues to collapse and these guys are still like everythings ok.theres vacancy signs all over the city ranging from commercial to residential. brookly has already had a few projects foreclosed on with more coming.gonna take a little bit more than hope and psychology to turn this around im afraid to say. until banks decide to hand out money for free again, manhattan RE is toast.

AR, you have mail.

printer you have many opinions about the lives of others--tell us about your life--add to the mix--what kind of work do you do?--how old are your children--how are they doing?--what kind of school(s) do they attend?--does your wife work? who cares for your children?--what are the community activities you encourage your children to engage? do you work hard? long hours? does your wife? do you own? do you rent? how big is your family? how big is your home? do you commute to work? do you own your own business? do you consider yourself well off? do you think your children are getting the support you would consider optimal? where would you improve upon what you are providing?

whaddayagot?

actually printer, i tend to be overly empathetic. i don't get any real evidence of support for anyone from you. you swoop in and say overtly nasty and controversial shit and then leave for a while.

yeah printer... make some shit up... whaddayagot? I'm make shit up left and right... the KEY is consistency... stay in character... FWIW we need more $1MM trannies with lesbian wives with adopted children from Cambodia.... we need to fill out our SE ethnic sub-minority quota... can you be a honey and be a tranny for us?

but only a tranny if he is willing to still have/make/find two children to support his miserable reason for existence.

btw, not saying that the tranny existence is per se miserable. just extending the arguments of others.

have you ever spoken to a tranny... believe me it is a sad existence in the sense they are in conflict w/ themselves and society.. I REALLY do feel awful for them.

But they are a hoot!!!

odds are that there is a tranny among us.

As someone who has a fair amount of friends in the transgendered community, I'm finding this pretty offensive.

30yrs, my sincerest apologies. it was offensive, and i'm very sorry. people are indeed merely people, and that was what i was intending to say. whether they have one child, stay at home, work, are poor, rich, white, black, tranny or straight wearing pill-box hats, it doesn't matter.

compassion does. and if that makes me a limo liberal, so f'g be it.

Of all that bonus money, how much is being paid to renters? Of those, how many want to buy in this tape? Yes and its funny that doom and gloom was moronic. Market down 25%+.

Goldman reported earnings today. Damn how easy it is to make money when the government covers your counterparty risk: all those transactions with AIG made whole by the federal government!

And they have the gall to pay themselves record bonuses!

Imagine that: you lose money, the government pays you for it. You make money, you keep it.

That's the deal that I want!

Its bad. And I am in finance. I think the answer is you dont let any place become too big to fail. Obviously AIG counterparty risk is something they took and should bear.

ubottom, I'm flattered by your desire to know more about me - here's the skinny:

During the day I translate various business/technical articles inte English from the comfort of my Chelsea rental (Fall-Spring), or my Fire Island pad (Summer). At night I dabble in stand-up. In addition I have an orgiastically successful business developing breakthrough interactive children's learning toys, with capital provided by the 5, no 10, no 15 properties I own on the LES. All this while getting blown by one of my 3 model wives/girlfriends, who apparently are turned on by the fact that I'm a transexual. For leisure, when not in Fire Island, I jet off to visit my sparkling pad in Lake Las Vegas, singing duets with Celine Dion.
I was graduated from Yale, upon which I did something or another for a few years, including an unfortunately unsuccessful retail venture, while my do-gooding husband improves the world through his corporate lawyering and I sit home, bloggin on SE all day (its research for a book, you understand), while a ticker crosses my screen with second by second updates of the U6. I must say (and don't you know it I will), that my values are impeccable and everyone in NYC feels comfortable in my home - in fact my daughter's friend's have all told me multiple times that they wish they could replace their parents with me. alas..
I'm desperate to own a place in Carnegie Hill, but I don't have the cajones (or the money as every last cent of free cash flow goes directly to Amazon so that I can fill my apt with books to show everyone how smart I am), so despite allegedly being a BSD research analyst at a hedge fund, I somehow have the time to calculate the mythical ROC on every apt that comes on the market, because I will bottom-tick the market down to the last basis pt - because dammit, yes, I am just that good. (of course if I were really that good I would have so much money that I'd be at 15CPW, but whatever).

printer... WOW.... you spend way way too much time on SE.... me too... I actually get most of your shit...... you should've added in "cat scratch your piggie eyes out" to really show your stuff... but otherwise a good waste of 10 minutes of your day.. .enjoy!

Very clever printer!

printer i admire your focus. but you're lacking in style.

cajones = desk drawers.

'cajones = desk drawers' - yes, those pesky mistranslations are what keep my business from getting to the point where'd I have enough $$ to actually buy a place. alas.

you are correct AR - I am not that creative - when I publish my memoirs, perhaps you can ghost-write them for me

no, by then i'll be "retired."

'and if that makes me a limo liberal, so f'g be it."

....

We now call it "Gulfstream Liberals" and welcome to the club!

Sure beats, say, "Six Year Old in Runaway Balloon Conservatives". I hope that kid has a safe landing.

just when wonderinfant is making an effort to be inclusive...

"those pesky mistranslations are what keep my business from getting to the point where'd I have enough $$ to actually buy a place. alas."

If you really would like to buy a place that costs twice as much as it does to rent an identical place, mistranslations are the least of your worry. You should seek professional help.

We have hit bottom and will see sluggish upward movement the next year in NY RE. As we get into 2011-2012, buyers will become less wary and sellers more aggressive.

printer, nice.

"If you really would like to buy a place that costs twice as much as it does to rent an identical place"

That drum has holes in it

Yes, Juicy, you're on that roll again, even though you found exactly ZERO holes.