Crains: Huge job cuts on Wall Street forecast

And this will affect NYC RE. how?

Clearly, the generous severance packages that "Laid-off employees figure to receive" will float the whole isle of Manhattan. I think that's quite obviously my point.

some of these severance packages are not all that generous. junior to middle experienced folks will be changing fields and moving out of NYC in droves. short term bad, very bad. long term, not so much.

Goldman traders won't be able to hire Irish carpenters to build closets in their new condos, so those carpenters won't be able to afford apartments at 15 CPW anymore.

It's very depressing Alan. My firm plans to lay off 20% in the coming weeks. In speaking with collegues elsewhere, it's all the same. And though there are people who make a lot in this biz, there are many more who are basically salaried people, known internally as "cost centers". They are the ones that never had the big bonuses to fall back on.

IMO, anyone who doesn't think this impacts NYC real estate is smoking crack cocaine.

hey dco, I had a teacher in 7th grade who would diagnose what you have as dirrhea of the mouth. Next time before posting something meaningless, close your eyes, take a deep breath, count to 5, and then reconsider if you actually have something to add to the discussion.

ranter- Have you ever read any of my posts. Clearly you have no idea my stance on NYC RE. What is it, that you think I was implying?

bring it on! i would love to see manhattan re crashing, who wouldn't!? the impact as usual will show and is showing in brooklyn/queens that's where the not well people from wall street (many to be laid off) leave. i know many, and they live paycheck by paycheck believe it or not. they'll hang out in the city trying to find sth else while the severance package last (3 months). have an interview in london, other in hong kong... nothing will come up and they will move out of hte city and start on a different path. there's too much supply of labor in finance, same thing in real estate. time to adjust! the quick will do well, the slow will suffer.

During the dot-com bust only brokers and cash traders, for the most part, were laid off. They were easily replaced with technology. This time we're going to see the "skill players" go down: banking, derivatives, prop, the MBA's and the Ph.D.'s. This is going to be more like 1990 than 2000 in terms of layoffs. And don't forget the lawyers at White & Case, Sullivan & Cromwell, etc... who have to cut back staff as well.

80s man. You are correct -- e.g., during the downturn in 2001 merrill lynch released 1400 of its 2100 investment bankers. ibanks hire in cycles and flow solely based on business.

manhattanfox, I should also mention all of the research analysts who get fired in every cycle, like they did at Bear in 2001. The difference this time around is that Wall Street is going to cut muscle and bone, not just fat. Some guy bringing in $4,000,000 in revenue and making $750,000 may find him(her)self without a job pretty soon. This is going to be a WFT? moment for a lot of people.

I mean "WTF?"

ah it will be so nice in NY when all these Wall Streeters get cut and have to move out of town. Maybe NY will return to its creative and cultural roots and we will have to deal with less WS wankers.

80sMan, you could not be more wrong. During the dot-com bust thousands of tech people were laid off, at least 10,000 if I recall. Good people with solid careers in the business couldn't find work. What did that mean? It meant people who worked for big banks/brokers on either side, the vendors that supported them (DoubleClick, Sybase, and many you never heard of), it meant recruiters, consultants, oh, and don't forget the ad slumps, b/c it wasn't fun to be a journalist back then.

If you lived here during that time 80sMan, you certainly saw a different nyc than I did.

petrfitz, do you have friends?

petrfitz is pretty much NYC's equivalent to Tony Rezko, a scumbag elitist crook

Notice how yesterday he was unable to defend his positions, scratch that, his oddly-placed anger on a multitude of political issues.

Today he's probably arranging for an eviction on a slum property he bought.

petrfitz what do you have against the Wall Streeters? Could it be that they may have positioned themselves better than you in life and know how to make $$$ ???? Further, thos "creative and cultural roots" you speak of are supported by a lot of Wall Street money.

LP1 I don't know the "tech side" of Wall Street if that's what you're talking about(the server guys?). I know people, I have worked, in the "front/middle office" side. Sales, trading, prop, research, asset management, prime brokerage and their direct support: quants, risk management. These people survived 2001 for the most part. So far the news is not good for the brain trust of Wall Street in 2008. The guys who install servers and networks will be moving along and finding jobs installing servers and networks for other industries for probably close to the same money, I suppose. It's hard for the revenue generators to make that kind of cash anywhere else. That's my point.

stealth1 - positioned themselves better in life? Do you mean that life is better when you work a demeaning souless job 90 hours per week then burn out after a few years? I own my own media company, own 4 buildings in manhattan.

I have self financed my last 2 companies and therefore am in no way supported by Wall Streeters.

I see Wall Streeters not as supporters of entrepeneurs but as blood suckers who take more than they deserve for do very little.

perfitz, your empire seems to grow with every post. by tomorrow I fully expect you to be worth $50mm and to own central park.

ranter why didnt you compare me to Keating?

I think that ranter is the NYC equivalent of Jeff Gannon.

zizizi please look at all my back posts and you will see that I am entirely consist. Please point to 1 that is different.

80sMan -- tech side of Wall St refers to anything from your "server guys" to the programmers and analysts who build the trading systems and models (it's hard to trade equities without these folks, think about it). Back in 2001, or at least the late 90s, these were good jobs, populated by people with engineering/compsci degrees from Columbia, NYU and the like, often with master degrees as well. Many of todays quants and risk managers were tech back in 99. When the bottom dropped out of the dot-coms, the field was **destroyed** and those people had to re-educate themselves. Perhaps we only read the stories about our interests, but it was hard to miss b/c the papers talked about it daily. After all it was a tech bubble that burst.

And again there were all the other fields, lawyers who supported IPOs, anyone driven by advertising dollars...you know there was a pretty bad recession in 2001/2. Of course we got out of it when Greenspan dropped the rates to zero and the housing machine was turned out.

petrfitz, it's a good thing that wall street demand has had nothing to do with the value of those 4 buildings you own... either directly or indirectly.

Special K please provide proof that it has?

They are all in the LES. Not one tenant is a Wall Streeter

petrfitz, you're so confused. You're the enemy of arts and culture. You constantly spew hate and derision at the rent stabilized tenants who make up the vast majority of working artists simply because in your mind anyone who can't afford to buy a $1,000,000 apartment is a loser. And now you say that NYC needs more creativity and culture? It needs less of you. Stay in Nevada. I hear prices of the homes in your neighborhood just fell by 25%. Go buy some more. Player.

i am against rent stabilization as it is mainly abused by those currently using it. I have no problem supporting artists and musicians in RS and RC if they can prove income levels.

I dont think and never said that anyone who cant afford a $1million apartment is a loser. I have said the opposite - that those who can afford to buy and rent as a "Strategy" are losers.

80sman - the Vegas place is a second vacation home that i got at over 40% discount. I am still above water but if I lose the whole value its not a big deal for me.

80sman - where is your 2nd vacation home?

petrfitz is a scumbag, NYC's equivalent of Tony Rezko.

He owns tenement buildings on the Lower East Side and doesn't invest in them, rather seeking to remove long-time tenants to jack up the rates. He hates his tenants too, frequently making fun of anyone who rents on streeteasy.

Jeff Gannon, is that the best you can come up with? You don't even know my sex or sexuality. I do know your style however, Lower East Side scumbag slumlord.

Why does anyone believe anything that petrfitz says? He claims to be this real-estate guru and makes all sorts of nonsensical posts about co-op financing. Every time someone says something, he invents a new credit:

a) Co-op sponsor
b) Air-right holder
c) Apartment building owner
d) Media company owner
e) Celine Dion's next-door neighbor in Las Vegas
f) Chauffeur-driven Prius owner
g) 3000 square foot Manhattan condo owner with a view of the Hanging Gardens of Babylon
h) Trophy wife owner: she's a trust-fund baby naturally blonde English Shakespearean actress singer / songwriter / puppeteer / square dancer, mother of his 2.5 perfect children
i) Knower of multitudes of people in Alpine, New Jersey, but can't remember the name of Main Street

Do we need to go on?

Just ignore him. He's none of these things. I think he's an NYU student with nothing better to do than make up stories instead of studying in the library.

"Special K please provide proof that it has?

They are all in the LES. Not one tenant is a Wall Streeter"

petrfitz, do you honestly believe a large contraction in the largest income source for the city won't adversely affect your financial situation? and even if so, then i would say good for you - in all sincerity. but it's just inappropriate to make a blanket comment like that regarding people in finance. sure, some have made millions and will simply vacation in the carribean for a year or two before coming back and getting a fat multi-year package when things get better, so i don't feel sorry for them. but what about all the people that 80sMan and LP1 are talking about? hard working people who are simply trying to make a living like everyone else and now are falling on very difficult times. you don't think some of them have families or are worried about their financial futures?

i have friends in finance that have been laid off in the past 6 months and i can tell you they DO NOT have huge warchests of riches and gold stored up. They are worried, trying hard to find something and I am sympathetic to them. The last thing in the world I would do is call them a wanker and hope they leave the city.

steve all of the above are true:

1 - one of my buildings is undergoing conversion
2 - when you own a building or several buildings you may also own air rights - of which almost all buildings in the LES are unbuilt and have unbuilt air rights
3 - always said 4 tenament buildings.
4 - always said that and always said that i previously started and sold 3 others.
5 - always said that and some one even provided the google maps satelite link.
6 - driver sometimes, i drive myself often. Whats so glorious about a prius?
7 - true! outdoor space baby. avid gardener.
8 - true i am a lucky man, never said she waas a blone though.
9 - ahh alpine stuff was kidding alpine who actually thinks some C list suburb will actually outperform manhattan real estate.

ranter - please prove your statement:
"He owns tenement buildings on the Lower East Side and doesn't invest in them, rather seeking to remove long-time tenants to jack up the rates. He hates his tenants too, frequently making fun of anyone who rents on streeteasy."

I have actually gone on the record on streeteasy stating that I have rennoavted all my buildings. please prove otherwise.

Ranter - what is your RE experience. How many units or buildings do you own? Or are you one of these renting is a financial strategy market timing sideline RE quarterback like Steve?

I think it is important to remember that in 2001 you had several issues going on all at once that affected NYC more than other areas. You had the .com bust, the overall weakening of the economy, the Big 5 public accounting firm Andersen imploded, Enron disintegrated and we had a terrorist attack that destroyed the World Trade Center and killed almost 5,000 good people.

This downturn is a difficult one, but is different from 2001. I work in the staffing industry and this is clearly a challenging time, but it is also not the same as 2001. This has been a slow-bleed as the credit markets have weakened over the past year. I do believe that WS firms will have more layoffs, but they will also be able to pull themselves out of this mess quicker than in 2001. They have seen this coming for some time and made nominal provisions and the federal government has been more active in protecting the industry.

I think we will hit the bottom somewhere between the end of '08 or the middle of '09. WS firms will then need to have a couple of profitable quarters before they start adding headcount again. I believe that the jobs situation will begin to improve steadily from this poitn on. The thing about the financial service firms is, they are resilient and they will find a way to make money. This often times leads to difficult moments like now, but also helps drive the industry through a recovery.

Salaries in NYC are not going to drop 40% and there is not going to be 10% unemployment and breadlines in the streets. Just my thoughts. Feel free to disagree. I don't know everything, but I am pretty successful in what I do and I have been through this before.

waverly, I will counter your attempt to bring this thread back on topic by taking it off-topic in another direction: when the US financial services induatry starts adding headcount, will the jobs be based in NY to the extent they have been, or even in the NY metro area? US? And why or why not?

waverly, if you don't mind me asking what industry(ies) do you staff for? and what type of trends have you seen in the past 2-3 months in staffing in those industries? has the outstanding number of people looking been increasing or have most of them been able to find something else?

waverly, well said. How this relates to nyc real estate, imo, is the unwillingness to make a big investment now. Not many people think '09 will be an improvement from '08 in relation to employment, the equity markets, CPI, GDP etc. Additionally, a lot of liquid wealth has evaporated from the middle income class of nyc (as defined by nyc wages not national wages), credit is more difficult to attain, and there is a lot of inventory on the market. Add all those things up and what you get is real estate falling back to levels that are in line with incomes, inflation and a non-bubble environment.

The same apartments I looked at back in March have sold at about 30% below their listing prices. They were over priced then, and are now reasonable. But they have sold.

I am a billionaire. I have gone on the record on streeteasy (my Holy Bible!) stating that many times. Please prove otherwise.

My take: he's a broker who posts about his fantasy life in his spare time (which he must have a lot of in this market). He gets a rise out of it. He knows enough that I give him the credit of being in the industry, but clearly its nowhere near the levels he claims. Reading between the lines, his confidence and demeanor is nowhere near in line with his supposed net worth.

Some firms have looked to add headcount in other states successfully and some found that they just didn't get the same personality they got here and changed gears again. From a cost perspective having some operations in NJ (Jersey City, Weehawken, Newark, etc.) or in Stamford or LIC lowers costs, but also changes the potential hiring pool going forward. For instance, UBS has much more difficulty hiring people into parts of the Securities business that sits in Stamford, CT than if these roles sat in NYC. Anyone living in the suburbs in NJ is not going to schlep all the way to CT every day.

Will firms begin a mass exodus? Not likely. NYC is the financial services capital of the world and it will stay that way. Firms want to be here. The exchange is here. There is a certain amount of "street cred" that smaller firms get by being able to play in the same space as the "big boys".

I am not implying the industry will not be hurt. It already has and there will be more pain, but not all of these employees are in the NYC metro area and many times the layoffs occur in stages and include natural turnover which is 8% or so. Still not great news, but it helps a little. The banks will always find a way to make more money. That is what they are good at. We are closer to the bottom than you may realize. Fannie and Freddie had to happen. Merrill selling paper for pennies on the dollar had to happen. Hiring freezes had to happen. More will happen, but we are closer to the bottom, which means we are closer to recovery.

That said. If something catastrophic happens then all bets are off.

Sneaky, if you were the sponsor of a co-op conversion you would have known all the things that you didn't know on that other thread, such as how banks value co-ops for financing (discounted flow of imputed rents), that co-op boards do not have a right to purchase units in the building to "prop up prices," that they are not sitting on massive amounts of "leverage" and "equity" (especially equity, given they all show an accumulated deficit on their balance sheets), that cash on hand is not an income or expense account, that once there is an underlying mortgage it is nearly impossible for a co-op to get further financing without refinancing, which almost always involves a prepayment penalty, and so on.

If you were truly involved in all those things you say you are, you wouldn't have time to post here.

It's too much, and too inconsistent to be true.

"Driver sometimes, i drive myself often." That's true of everybody with a drivers license who ever sits in another seat of the car.

So stop. It's enough. tech_guy said it perfectly: "Reading between the lines, his confidence and demeanor is nowhere near in line with his supposed net worth."

Personally, I don't dispute any financial claims petroputz makes. But what do I know. I do think he's a huge douchebag, however. He probably voted for Shelly Silver today.

Special K - My clients are all in the financial services industry. There are several different paths that firms have been taking lately. Some firms have clamped down all hiring for the rest of 2008 in an effort to save cash. Some are hiring, but not huge numbers of people. It is very targeted and they are being extremely selective in who they make an offer to and the offers that people are getting are not significant. Typically, offers will be 10-15% over current base salaries, while we are seeing more 5-10% increases for people employed and token increases of 0-5% for unemployed people. A smaller amount of firms are still aggressively hiring. They have not been hit as hard and feel they can acquire some talent from other firms that they may not usually get.

Remember too, that "financial services" is very broad. Some smaller investment firms are doing quite well. Bigger is not always better. Diverse firms are also doing well. For instance, FS firms that include insurance aspects in their business model have held up much better than retail banks who were heavy players in sub-prime loans.

LP1 - you have seen apartments in NYC that have sold for 30% less than they were listed for just 5 months ago? I don't doubt that there are a couple of these, but to give the impression that NYC RE is now moving at a 30% discount from March prices is just not accurate. Not all apartments are created equally. I do agree with you that nice apartments, in good neighborhoods, priced reasonably will still sell. Overpriced crap in sketchy neighborhoods....not so much.

TA - i voted against Shelley. I bet that you voted for Bush - twice!

Steve you argreed with me that have the right to buy units now you are arguing "that co-op boards do not have a right to purchase units in the building"

Steve did you forget your lithium today?

TA - Did Palin command the Alaska national guard overseas in a war zone?

Steve how many buildings have you owned?

Tech Guy - i have owned now 4 tech media companies - some were platform companies that built engines for the video games space - 3D engines both with downloadable plug in and non plug in, another was a mobile content company that focused on WAP and java (j2me) apps, now i am building a multiplatform company that creates and distributes content across mobile, broadband and VOD, an new VDN with a completely new approach to encoding and transcoding as well as content metadata schema.

is that info a re broker has or knows?

waverly - thanks for the color, it is helpful

petrfitz, why would I want to own a building? And even if I did, it doesn't take away from everything you seem NOT to know about owning buildings.

Your post sounds like you develop web applications, nothing more. That would certainly account for your free time to post here - you're already looking at a computer screen, so why not a little distraction?

Waverly, I have seen reductions of 2-300k on apts, with a final sell just over 1M. So I guess that's 25% +/-. Take this one I liked: http://www.streeteasy.com/nyc/sale/164788-coop-257-central-park-west-upper-west-side-new-york
started at 1.295, now relisted and staged with a different broker, in contract for 995k. 2 bd/2ba on CPW and 86th st. So, close to 30% less. We'll see what the actual sell price is when it closes.

Or this: http://www.streeteasy.com/nyc/sale/163836-coop-149-west-85th-street-upper-west-side-new-york
2bd 2ba listed at 1.345, closed at 1.1 That was a drop of 22%.

This crazy one http://www.streeteasy.com/nyc/sale/106146-coop-215-east-24th-street-kips-bay-new-york dropped 650k, maybe it was an outlayer. I tracked it b/c I thought it was so overpriced to begin with.

A few others that I looked at simply were taken off the market. But I am starting to see more places priced at a more realistic price point.

Steve - you obviously have no idea about what i do. "develop web applications" too funny.

and you translate what other people write, dont even write anything yourself, and day trade in brazilian commodities.

I create content, technology and build companies from the ground up that employ hundreds of people globally, you work for someone esle working on something that other people created.

sorry to be so blunt but you started it. i think that we will now call you employee number 87629405954 exempt.

Has anyone seen Tropic Thunder?

I imagine that petrfitz looks a lot like the sleazy hollywood producer played by Tom Cruise in the movie...he definitely sounds like him

(it's very funny if you haven't yet)

Has anyone seen the Crying game? I imagine that evillager is a lot like the Forrest Whittaker character and Steve is his love interest.

"I create content, technology and build companies from the ground up that employ hundreds of people globally, you work for someone esle working on something that other people created."

My, my, my: sounds like you think you invented the transistor or something. You, as everyone, build upon what others have already done. The value added in what I do - which is what I choose to do because I like it - is infinite: either you understand what it says, or you don't.

"dont even write anything yourself"

Entirely untrue. I write and perform my material all the time, the last time at Caroline's on Broadway.

"day trade in brazilian commodities"

I have never day-traded in my life. And while I still own Brazil - which has been painful recently - I dumped commodities a month ago and cleared up most of my China exposure at the beginning of the year. I either own ETF's or 2x bull / bear funds; I own no individual stocks or bonds. I intend to keep them for long periods of time until the fundamentals change, and on Brazil, the fundamentals have not changed regardless of the correction in their stock market.

"employ hundreds of people globally"

You seem to have an awful lot of time on your hands for that.

Steve owns Brazil. Doesn't rent it.

Steve your ignorance shows again: "You, as everyone, build upon what others have already done."

in myindustry every single line of code can be examoned for patent,trademark infringement. Our technology and all processes cna be examined for "building upon" others.

If we do what you say, we get sued.

it must suck to have to downplay other peoples acoomplishments all the time to make yourself feel better about being a typist.

"Nothing so fortifies a friendship as a belief on the part of one friend that he is superior to the other."

Honore de Balzac

People in Alaska are better than people in the rest of the U.S. They're more American.

http://www.time.com/time/politics/article/0,8599,1839724,00.html

Drill, baby, drill!

waverly, who cares about "base salary". You can' buy a $1,000,000 apt on $200K a year. Do you work with the "total comp" guys. The people getting packages of $500K+ guaranteed for 2-3 years? And insurance groups? Most people I know would rather kill themselves than work for an insurance company or pension plan. But, sometimes you gotta do what you gotta do. Nothing you have said gives me any confidence that Wall Street employees are not looking at a once-every-15-year plague.

"in myindustry every single line of code can be examoned for patent,trademark infringement. Our technology and all processes cna be examined for "building upon" others."

So then you mean that you invented the printed circuit board, the compiler, or - let's say - electricity?

Please petrfitz, get over yourself.

Now as it happens I do type quickly, and I learned it in the early days of microcomputers when I was a programmer, when all of the neat-o code generating products people use now didn't exist, and programs were either written on punch cards or in line editors. When the old System-34's were as big as a room and had 64k of memory - try programming in RPG or COBOL, get back to me.

Why you are so difficult to bear, petrfitz, is that you demean the value of what every other living person does - you're better than everybody! What I do takes decades of education and experience - you reduce it to "typing." That's just one more reason not to believe that anything you say is true: someone in the position you claim to have, rather than ridiculing the accomplishments of others, would realize how much they rely on other people to help them do what they do best. We may argue and disagree, but none of us - except you - is an island unto himself, seemingly placed on earth to rule over lesser mortals and extol the virtues of his existence.

No one, except - Donald Trump. That is who you remind me of. The Donald.

Steve - i have translators who work for me on a daily basis. None of them have decades of education or experience.

and I was once proficient in COBOL and FORTRAN. But am perplexed why you think that knowledge of a 30 year old computing language no longer used is of any value?

I launched my firt start up in the early 90s when IE and netscape didnt exist.

Steve's job = babelfish.

"TA - i voted against Shelley. I bet that you voted for Bush - twice!"

I vote for winners. And have you seen the hit job they're pulling on GWB now. Woodward now assails Bush because he DIDN'T listen to his commanders in the field and pushed the surge.....which is working!!! What a putz! So Bush is damned if he does and damned if he doesn't. I wish the Dem heads would just admit that they want us to lose in Iraq just like they wanted us to lose in Vietnam, you know, the war we "lost" without ever having lost a battle.

Now you have translators working for you, too?

Stop. Please. Stop.

"when IE and netscape didnt exist."

Wow! How about JCL and RACF, VSAM, VTAM, and the other old standbys?

Please, petrfitz. Just please. After this post I am now officially ignoring you.

"Ignoring comment by petrfitz. Click here to reveal it."

Happy days are here again!

TA - Bush was a really Winner on the economy. He was also a real Winner on finding those WOMD's. He was also a real winner in getting Osama Dead or Alice. Bush was a winner on responding to Katrina.

TA in those terms, you are a real winner too.

"Ignoring comment by petrfitz."

Interesting discussion on this WS downturn vs. the one in 2001-2002, dynamics, timing of recovery, etc.

I lived through the one in 2001 and was one of the lay-offs. Was an ibanker back then (never again), very much front-office. My ibank went through 4 different rounds of layoffs in 2001 and early 2002, with a ton of "front office" people let go. Granted, my ibank's industry focus was tech/internet, so it's not representative, but I know tons of other ibankers at many banks that were let go then. Equally importantly, hiring out of undergrad and MBA slowed to a crawl, i.e. attrition was not replaced. So the net number of Wall Street jobs saw a big decrease. Not arguing with those who say it'll be worse this time around (can't tell yet), just saying it was pretty bad then.

Another offshoot of WS is hedge funds. There have been a ton of them in the last few years, most making money, and generating tremendous wealth for the hedge fund employees (most of them former ibankers). I am anecdotally hearing of more and more funds that are suffering and/or blowing up. The sheer number of people affected isn't as high as ibankers, but the money and "trickle down" effect is still significant.

The similarity between the current and 2001-2003 economic/WS downturns is the bubble, with the inevitable bursting. Tech bubble then. Housing/credit bubble now. Yes, there's a recovery, but it's usually a recovery to more reasonable/sustainable levels. Witness tech stocks in 2004-2007 - strong performance, but nowhere remotely near the 1999-2000 levels. Of course, then there's the next bubble, usually in something different.

It's interesting that NYC housing didn't experience a severe or prolonged downturn in 2001-2003. To be perfectly honest, I am not sure why. One explanation I can think of is that the run-up to that point had been fairly modest, possibly due to the (then) recent memory of the 90's and people's resulting caution. A related point is the affordability - in 2002, some of the doctors, engineers, etc. may have stepped in and bought apartments in Manhattan, whereas today they're completely priced out, so when the ibankers and hedgies stop buying, there's very little left to support demand.

newbuyer says "It's interesting that NYC housing didn't experience a severe or prolonged downturn in 2001-2003"

Newbuyer do you know why housing didnt tank during this time? Its because the Bush administration knew that their entire economic policy wasnt going to produce squat and they wanted to keep their tax cuts to the rich. So through deregulation of lending practices combined with historic cuts to lending rates they produced and environment where Americans were subject to predatory lending and over marketing causing a totally false inflation of home values and the ensuing historic extraction of home equity.

Basically they pumped up housing prices then encouraged people to extract all their equity. The Bush administration then encouraged people to spend this equity on crap. Remember Bush telling Americans to "spend" to support the War?

This was a purposeful maneuver by the party in power to throw a beeard on their failed econolic policies. While americans were spending away all their equity from the pumped up false valuations all the Republicans were talking about the "Strong" economy with a "strong" foundation.

That is why housing didnt decrease during that time and rose dramatically.

so they created a real estate bubble to hide their disasterous economic policies and that bubble led to the current credit crisis and real estate meltdown.

"Ignoring comment by petrfitz"

attaboy

funny was just reading an article on the newswire that agrees with my point:

"“The answer is quit making dumb mistakes,” says Dan Mitchell a senior fellow at the Cato Institute.

Mitchell’s answer is actually a lot more complicated that it appears.

.....But he’ll also tell you that most of what the federal government has done is meant to ease the popping of the housing bubble, which it created in the first place, thanks to artificially low interest rates, government-supported mortgage lenders and liberal lending requirements....."

petr: Chopping together a few blocks from various real companies "About Us" webpages doesn't prove anything. You especially lost all credibility with this gem: "in myindustry every single line of code can be examoned for patent,trademark infringement.". Sorry pal, but code *can't* violate trademarks. You sound exactly like this guy:

http://www.xkcd.com/451/

While it sounds good to lay people, it makes absolutely zero sense to anyone actually in the industry.

TRADE SECRET PROTECTION

Trade secret protection is an important means of protecting computer software. Coupled with copyright protection, this is often the most effective way to protect computer software. Computer programs are copyrightable works under U.S. copyright law. The Copyright Office now regularly issues registrations for computer programs. Both source code and object code can be registered although a "rule of doubt" registration will be issued for object code.

tech guy - I am starting to think that you are just a bitter MIS guy. Can you come here and change the cartridge on my printer?

tech guy - i need my monitor cleaned ASAP

TRADEMARK PROTECTION

The Patent and Trademark Office has issued a special rule which permits filing a photograph of a computer screen as evidence of trademark use. U.S. Patent & Trademark Office, Trademark Manual of Examining Procedure § 905.04(d) (2d ed. 1993). This rule is necessary because purchasers of computer programs often do not see the computer trademarks until the "trademark" comes up "on the screen" after installation of the computer software.

If the software is being advertised as "compatible with" other trademarked hardware or software, the software must in fact be truly "compatible." Otherwise, problems may arise under Section 43(a) of the Lanham Act, 15 U.S.C. Section 1125(a), or state and common law unfair competition laws.

Let's review the 3 fundamental Wall Street business models:

1. Collect fees (i.e. brokerage services, wealth management, asset management)
2. Run monopolies (capital markets)
3. Exploit tax loopholes (structured products, derivatives)

All of these are sound and enduring businesses which are always going to exist as long as we have capital markets. I'm going to say by 2011 things will be looking good for Wall Street again. Wall Street will need to wait. And while it's waiting it needs to fire a lot of people. And then it needs the government to get the toxic risk off the bank's books. And then people need to start realizing they're missing the next get-rich-quick scheme. And off we go!

There's a lot I don't agree with Stevejhx on, but I certainly agree with "Ignoring comment by petrfitz".

so newbuyer you disagree that the housing bubble was created during the 2001-2003 period?

then what did create it?

petr: Nothing in your past few posts mentions anything about trademarks in lines of code, which was your original mistake. Appearing on a computer monitor, obviously, but that wasn't your claim. Of course to a non-programmer like yourself, you don't understand the difference, but trust me, its as big as the Grand Canyon to anyone knowledgeable in the field.

And "Ignoring comment by petrfitz" remains on!

Yes, tech_guy, though I'm not reading petrfitz ever again, I was going to mention that thing about patents, but the killer was TRADEMARK infringement! How can computer code violate a trademark?

That's first. Second, computer code is copyrighted, but it is not available to the public. So if you copy it and use it it would be a copyright violation, not a patent violation.

What can be patented is a process - such as embedding photos into emails. The patent covers not the code, but the invention.

80's, 2011 will be a great year. However, what's going on now outside the housing / financial sector is irrational. Remember all the comments about rising oil prices and how they would destroy the stock market? And rising commodity prices, how they wold cause inflation? Now that both have fallen, stocks are falling - exactly the opposite of what they should be doing.

In all my years I've never actually seen the stock market act like this, not even in 1987. There does need to be more intervention by governments - to avoid massive deflation, which seems to be where we're headed.

I have to say that Jim Cramer is right on this one, just as he was right on "They Know Nothing!" The danger now is not inflation - which since 40% of the CPI is imputed rents, will fall dramatically - but deflation. I think the Fed sometimes worries too much about its numbers, and not about what they do to get them.

MIS and trnslator you guys are good at talking out your arses. Tech guy i guess that you dont get involved with writing code or creating programs much as you spend all day changing printer cartridges. Steve has more than proven himself as talking out his ass.

Yeah there is nothing to worry about it terms of trademarks when you are writing code and creating computer programs.

too funny.

"Ignoring comment by petrfitz"

Steve, govt intervention is what got us here as the entire Western world now views every asset as a one-way bet in the "long term" and therefore is levered up without the underlying income to support it. I suppose I agree that government intervention is necessary to keep the unwind "orderly" but prices of just about everything seem to be heading down no matter what. If this is the "big one" then assets will fall until realistic debt levels are achieved - could be a long, long way down, particularly for real estate. We'll see if the govt can reflate this thing one more time but i doubt it.

mbz I agree with you, and what I'm not suggesting is a bailout. What I'm suggesting is stabilizing things and restructuring the economy, especially the financial sector.

This housing bubble was foreseeable and avoidable - the current administration didn't want to do anything about it: you know, the "ownership society." But there is an even greater danger in deflation than there is in inflation.

No one knows what lurks on banks' balance sheets, but let's look at facts: oil has fallen from $140 to about $100, where it was in December. It will probably fall somewhat more. Except for housing and finance, the rest of the economy is in my opinion and experience fundamentally sound. I have a very economically-sensitive job, yet the work keeps streaming in. BRIC is still growing incredibly, yet their markets are collapsing.

And my guess is that they will come back as fast as they fell: look at Brazil, a cause of personal pain, which in May was upgraded to investment-grade debt, and their market has fallen 33% since then. But the fundamentals have not changed: they still grow at 7%, inflation is under control, and they have a 180-million person market. Yet their stock market trades at 12x earnings.

Our economy may have stalled, but it has not declined.

This volatility is the sign of uncertainty - commodities go up one day, they go down the next. Volatility is very dangerous in a stock market. 33% declines in stock prices with no fundamental economic change is very dangerous. What needs to happen is for the government to force banks to pony up and take the hit all at once, and end this once and for all. Else the result will be disastrous.

Not only do I write code, the only reason I post here is to pass time while code is compiling. What's your excuse?

Tech, if you're addressing petrfitz, I can't see it! :( But as petrfitz happily notes, I am but a typist, albeit one who makes between 12 and 14 cents per typed word, but nonetheless. I post here to get my mind off of some mind-numbing documents. petrfitz posts here because he is a:

a) Co-op sponsor
b) Air-right holder
c) Apartment building owner
d) Media company owner
e) Celine Dion's next-door neighbor in Las Vegas
f) Chauffeur-driven Prius owner
g) 3000 square foot Manhattan condo owner with a view of the Hanging Gardens of Babylon
h) Trophy wife owner: she's a trust-fund baby naturally blonde English Shakespearean actress singer / songwriter / puppeteer / square dancer, mother of his 2.5 perfect children
i) Knower of multitudes of people in Alpine, New Jersey, but can't remember the name of Main Street

and the code he compiles violates trademark laws. LOL.

what code do you write and for what type of applications? please tell us version as well.

Oh yes, did I mention, petrfitz also hires translators regularly who have no experience or education. That's why he pays them between 12 and 14 cents per word. Except the Dutch ones, who make 18 cents per.

steve dont typists also get paid by the word?

steve: yes, my last comment was aimed at petr.

petr: I'll volunteer that I code in C++, but no more details. I'll also volunteer that its nonsensical to ask for a "type" of application as well as "version". Versions are only meaningful for a particular application name, not a type of application - your ignorance is still shining bright.

But no, I won't volunteer what type :) I have nothing to prove, and I couldn't possibly care less if you believe me or not.

tech_guy, take some advice from a guy who makes 12 to 14 cents per typed word: "Ignoring comment by petrfitz!"

It will make you happy.

Read the ARM thread from the other day, wherein petrfitz made this massively stupid claim that "he" was a co-op sponsor, yet didn't even know the first thing about co-op law or financing. He's a fraud.

Tech Guy & Steve - here is your trademark issues for computer programming 101

lets start at the very beginning - page name.

if a coder were to populate page name with "Disney Approved!" according to you that is not a trademark issue?

should i continue past the first thing (page name) that is created by a computer programmer for more trademark issues?

Steve you just got owned as Petrfitz just pointed out trademark violations in the very first thing that you type while coding. PAGE NAME!

Steve gets proven wrong yet again.

Sorry to rain on your parade, but HTML isn't "coding". Try again.

for steve: I know I could ignore him, but I'm having so much fun laughing at his feeble attempts to convince me he's a real engineer :)

> I think it is important to remember that in 2001 you had several issues going on all at once
> that affected NYC more than other areas. You had the .com bust, the overall weakening of the
> economy, the Big 5 public accounting firm Andersen imploded, Enron disintegrated and we had
> a terrorist attack that destroyed the World Trade Center and killed almost 5,000 good people."

And none of those had anywhere near the impact on Wall Street, which represents about 1 third of all the paycheck $$$ in NYC.

Then, on top of that, we have the worst housing market apparently since the depression (which seems to be leading to further and further decreases in consumer spending).

And we have one of the worst credit situations ever.

All, to me, worse then any of the factors you noted, and all more directly impactful on NYC financially IMHO. WTC, if anything, spurred a lot of action/activity/funding here. Hell, just the constructions. And Andersen imploding? That was legal, not financial. Their business went elswhere. Compare that to Bear, a MUCH more important employer here, which went down for financial, not legal reasons. Much of the assets are gone. Enron? One company... compare that to a line of dominos of banks

Seriously, sounds like we're grasping at straws here. 2001 was, relatively speaking, a sneeze.

> This downturn is a difficult one, but is different from 2001.

Yes, considerably worse IMHO.

> I work in the staffing industry and this is clearly a challenging time, but it is also
> not the same as 2001. This has been a slow-bleed as the credit markets have weakened
> over the past year. I do believe that WS firms will have more layoffs, but they will
> also be able to pull themselves out of this mess quicker than in 2001.

I think the logic is backward. Because it was a "slow bleed", meaning denial, the banks acted too slowly and without enough force. This is what one calls an avalance.

I remember the recessions before 2001. In the light of what normally happens in recessions, 2001 wasn't a real one. What propped up the economy was the creation of a new bubble - housing - because the low rates and lower lending standards.

Whats worse here is... we're probably going to get the aftershock of both of those bubbles now. There wasn't much of a "recovery" period with paring back and cutting costs. It wasn't long enough. So, I think we're going through a double-whammy.

Seriously, I think folks who only know of 2001 don't really get what recessions look like. We got spared in 2001, and I think all those things are now coming back...

LMAO

Come on kiddos, 2001 was but the appetizer for our main course. in the 10-course extravagant entree we're having, we just got handed our 5th course. don't forget about the 'derivatives' desert!!!

Your_Landlord is PETRFITZ. Do a search. Owns the same properties. So when Your_Landlord says, "Steve you just got owned as Petrfitz," you either gotta laugh, or puke.

tech_guy sussed petrfitz out as a technical tadpole. I sussed him out as a co-op newbie: doesn't even know what a co-op board can or can't do. So though I can't comment directly on what Sneaky says, I can say that blocking him has made me whole.

Just FYI, in my technical day I could code all the most complex assembler code there was. I'm out of practice. When JuiceMan said that JPM would be hiring thousands of new people to integrate BSC I nearly had a bout of diarrhea aka laughter. Sneaky would have us believe that no matter what we can do - and I readily admit I'm a crappy poker player - he's better at it. But when he claims that software can violate TRADEMARK protection, you just gotta ha-ha-ha, or heave.

One man's opinion.

MMafia...nothing happened in 2001. Nothing. A few boiler rooms got shut down. Mostly staffed with college dropouts and ex-Atlantic City card sharps. Who were they, really? Dean Witter holds outs and Merrill add-ons. Big deal. Now, in 2008, we're Italking about Ph.D.'s from Caltech and 15-year guys who were holding on to their seats under their knuckles turned white, MBA's (from God knows where because all MBA's are the same), are getting laid off.

2009 is not 2002. It's 1991. All over again.

80sMan is correct. But it's 1988, not 1991.

80s/steve - Agree that this one looks much worse than 01. Having said that, the big caveat is that this time around the S&P is only down ~21% thus far from its 07 peak and in 01/02, it fell 49% peak to trough. Most of the 01 fall was from P/E contraction since we started with a ridiculous P/E of around 35x. I do not think S&P will fall anywhere close to where it fell in 01 time frame. But in my mind what makes it clearly worse for nyc is that the epicenter of this debacle is in the financial firms in nyc vs the dot bombers in silicon valley. Another thing to consider is that wall street has grown significantly from 20 years ago and even from 7 years ago. I don't have hard data, but would guess it's significantly larger as % of nyc income/employment than before.

Of course petrfitz == your_landlord. It was pretty transparent. I was just waiting for him to be more ridiculous before pointing out the obvious :)

You know, if he wasn't so harsh on everyone else, I wouldn't care A happy fake-personality is fun. A ridiculing fake-personality needs to be ridiculed.

"Ignoring comment by petrfitz"

"Ignoring comment by Your_Landlord"

Somebody should just turn off his WiFi connection at Starbucks, and the world would be a happier place.

Back to work....