patrick.net

Thinking he was being frugal, Rick in 2003 opted for a diesel car, which gets 45 miles per gallon and needs little maintenance. At the time, he could get a gallon for $1.19, and a fill-up cost "maybe $19.
If ever there was a candidate for a WVO (waste vegetable oil) conversion kit, he would be it. One of my neighbors recently offered me his surplus WVO spoils, but we don't use enough fuel to justify a conversion.
BTW, "subsidized" biodiesel is now at parity with dino-diesel. This has never been the case during the time I have been using biodiesel (around 6 years).

DinOr,

I presume you mean refinancing from variable to fixed. This time though, he won't be able to roll the costs into the loan, and the monthly payment may go up compared to the teaser rate. Imagine the discourse:

"So Kent, to "fix" that loan you sold me a couple years back, I gotta shell out another couple grand out of pocket and then watch my payment increase?"

"Yep."

Headset,

Honestly I hadn't even stopped to think about that "interim screwing" in the shake down. Right, my bad, shake 'em down for a teaser loan, re-fi them into a FRM and THEN swoop in w/ your newly minted realtwhore's license and make a buck when the "client" goes into foreclosure!

EBGuy,

We're big on that in Oregon. They even have classes you can take. I want to re-power my boat w/ a 4-53 Detroit Diesel but didn't know how well it would work w/ a 2-Stoke engine (and marine application as well)

TIA

re Daniel Gross' article in Newsweek

I always suspected Gross was an idiot. Now I'm certain. Take a problem of Financial WMD and lax application of inadequate regulations and portray it as a class warfare issue. That'll really clarify things for the average Newsweek reader!

The problem is NOT having inadequate regulations.

The problem is over-regulation. When has moral hazard ever been associated with inadequate regulations?

skibum :

Or, the question that’s gnawing at me, which is, how would two “execs” in the subprime industry really believe that their industry and careers were “rock solid?”

While I have no sympathy for any of these mortgage SOBsters, I kind of get this sentiment.

Very few dot com guys thought that the world as they knew would simply vanish. When you are dreaming as being the enabler of endless prosperity it's easy to not wake up till it's too late. Every dot com CEO fancied himself to be the visionary and the next Steve Jobs. I have met a few who were all too busy trying to be charismatic and forgot about becoming profitable.

Why would anyone care about being the enabler of endless prosperity? Profit is about taking, not providing.

Why would anyone care about being the enabler of endless prosperity?

EGO

EGO is neither profitable nor edible.

I much rather be a hidden oilman than someone like Steve Jobs.

I am a strong proponent in military spending not in the form of salary to GIs or front troops, because you shouldn't need to deploy them that often. The modern warfare should be fought with least human involvement. Iraq war is the ultimate spending of how NOT to allocate one's military spending.

I am for increasing funding to NASA, national science labs with a focus on military aspects. Unfortunately I am seeing the opposite today, because lots of labs are laying off researchers left and right. I personally know of a couple of very promising military research projects that got cut due to lack of funding. If we are resorting to fighting with warm bodies, we are going to be no different from Argentina. And the sad thing is, all these cuts happened because of the stupid housing bubble which added no value whatsoever, unlike the internet boom, which did change our lives drastically one way or another. I feel a lot better with our collective financial loss in the Nasdaq than the housing bubble.

Wrt to corruption and wastage through buddy contracting, there's simply no way you can get around that. Blackwater is indeed a shame, because it doesn't build any knowhow nor expertise.

For the upcoming election, at least there's one piece of good news. Bush is going to be out of office.

For that "executive" couple at New Century, I feel completely vindicated to see them suffer. I'd like to see more stories like that for reading amusements.

What kind of "executive" are you if all you can think of in a jobless state is to sell useless crap over the internet? Yeah, like people are going to ramp up jewelery purchase after the housing bubble bursts. Great "executive" thinking.

They are just going right back to where they belong from the very beginning.

DinOR,

the key question for the couple is, what SKILL do they have? As far as I am concerned I see none.

Those guys deployed in the field right now are a HELL of a lot more than just "warm bodies". Besides it's awfully f@cking hard to have high tech responses to people that strap bombs to children.

WTF?

Cross posting from Zillow boards.

WARNING : Large 75 page PDF file with lots of statistics.

http://tinyurl.com/295kya

Ton of information and charts. Awesome.

Some snippets
Current: Assuming constant interest rates, borrowing power today has declined 39.4% vs. only nine months ago
•Scenario 1: If interest rates drop 100 basis points, then the decline is “only”28.9%
•Scenario 2: If interest rates drop 100 basis points and mortgages become fully amortizing, then the decline is 41.6%
•Scenarios 3 & 4: To maintain borrowing (0% decline) power the interest rate on fully amortizing mortgages would have to drop to 1.41%

Did anyone here read the Hitchhiker's Guide to the Universe?

There's a great part in the first book where a society had three groups of people: the thinkers, the do-ers, and the "useless middlemen". The thinkers and do-ers concocted an apocalyptic theory (shades of Global Warming) and sent the useless middlemen off in a spaceship to avoid said calamity. They told the useless middlemen that they had to go off in the first ship "because they are so important". :) The satire of the book is of course that the useless middlemen ended up colonizing Earth.

Hence useless middlemen like the Copes.

I am for increasing funding to NASA, national science labs with a focus on military aspects.

Can't that be privatized?

Replace Universe with Galaxy.

The City of Philadephia has just suspended sales of foreclosed homes.

Fed is meeting with Nordic finanical leadership in to explore how to nationalize our banks and minimize moral hazards such as occurred with Bear Sterns.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/03/31/cnfed131.xml

Dennis-

Excellent book and film, and timing of reference was perfect. :-)

I'm looking for some tax advice. If I replace my roof with a gildedgilded dome, when I sell my house, is the dome and said gilding considered a capital improvement that increases the basis of my house? Can I then claim the $500k capital gains exemption, or is a gilded dome considered a collectible? Also, can I refinance to the $1 million mortgage limit to fund this home improvement? Is this truly impractical and should I just go with the gold wallpaper reminiscent of the mid-seventies?

NVR, wow, those Scandanavians don't mess around!
While the responses varied in each Nordic country, there a was major effort to avoid the sort of "moral hazard" that has bedevilled efforts by the Fed and the Bank of England in trying to stabilise their banking systems.

Norway ensured that shareholders of insolvent lenders received nothing and the senior management was entirely purged. Two of the country's top four banks - Christiania Bank and Fokus - were seized by force majeure.

EBGuy
simply for reasons of vanity (since I'm only a renter), I too found myself in the same predicament. In the end I went with gold wallpaper as it achieved the exhibiting of ostentatiousness and moral poverty to those that matter (visitors to my rental, particularly "owners" who can't afford such luxuries), without unduly provoking those with weapons and a fancy for gold teeth and other bling.

I can't help you with the tax issues.

From NVA's article link:

Norway ensured that shareholders of insolvent lenders received nothing and the senior management was entirely purged.

No moral hazard here.

When has moral hazard ever been associated with inadequate regulations?

Haha! Very funny Peter Pan - even if you don't mean to :-)

Sorry EBGuy, we posted at the same time

Can we ask the Scandinavians to come run this country for a few years?

StuckinBA

thanks for that pdf. It's quite raphic!

Philadelphia info, I think this is a BIG deal.

http://www.reuters.com/article/gc03/idUSN2830318520080328?sp=true

Sorry for my haste, only have a minute.

Pace of things seems to be quickening to me now. Rice price is causing crisis all over, all net importers like Philippines. Third world economies that have started to life their populace out of poverty are about to submerge them right back.

Wish I had time to address evil AG subsidies. Saying you endorse them is equivalent of indicating you endorse nuclear weapons. Of course they result in much more than higher milk prices and death of family farms, which they certainly do, but they also actually directly drive death, rape, and misery the world over. Ever visit a 3rd World community that has been on the business end of world bank loans opening up their AG markets to subsidized corporate welfare products? Entire industries and cultures thrust into desperate poverty and resultant violence and exploitation. Isn’t pretty.

But like nuclear weapons AG subsidies are now a necessary evil. Always will be players gaming own interests and industry for trade advantage, so everyone must engage in this cutthroat game or simply lose.

Justme,

With you brother on all points.

The problem is NOT having inadequate regulations.

The problem is over-regulation. When has moral hazard ever been associated with inadequate regulations?

Wrong. What effective "regulation" (policing) has the mortgage industry had over the last decade or two? Did the repeal of Glass-Steagal and similar legislation result in *more* bank regulation or *less* bank regulation?

Let's not confuse INDUSTRY SUBSIDIES or PORK or TAXPAYER BAILOUTS with real "regulation".

I'm a little confused about that Philly thing.

Acording to my copy of the Constitution, Art. I sec. 10 para. 1 says in pertinent part "No State shall ... pass any ... Law impairing the Obligation of Contracts ... ".

This thread is now also mentioned on the Big Picture blog.

Thanks BR from all Patrick.netizens.

What effective “regulation” (policing) has the mortgage industry had over the last decade or two?

The regulation of having the implicit backing from taxpayers?

Let’s not confuse INDUSTRY SUBSIDIES or PORK or TAXPAYER BAILOUTS with real “regulation”.

They go hand in hand.

I'm not sure we've addressed this yet, so please, check my math. OO, you should like this. According to this (PDF Alert) the Fed "Gold stock" as reported in the H.4.1 is valued at -- get this -- $42.22 per fine troy ounce. So the current Fed hoard, at today's market price of ~$900/oz is worth:
$11.041 billion / $42.22 * $900 = $235.36 billion
Headset, no worries, if the Fed blows through $600 billion of Treasuries, there is plenty of gold left to "sanitize" the credit supply. :-)
Also, I may have been asleep at the wheel when this was originally announced, but it looks like TAF is increasing to $100 billion the next go around.

Dennis-

My thoughts exactly relative to philly, no way that would pass a litigation test. Clearly its already passed their internal counsel muster. Sounds like a process change and delaying action, avoiding the contract issue.

@DennisM,

The Constitution is now being used as toilet paper in Congress and at the White House. I am only 27 years old and am already cynical about our government and its inability to follow the law.

Constitutional Law is supposed to override statutory law, but it does not. Take a look at Article 1, Section 8. This shows in clear transparent language the powers of Congress. I can only see a few that we still follow.