patrick.net

Actually the California Bar will admit to take the bar exam students who have "graduated from a law school in a country whose law is based upon English Common Law". And there is reciprocity with at least the UK. A friend of mine, born in Ireland, got a US JD and passed the CA bar. A few years ago she decided to go back home and got admitted in Ireland.

To practice in Ireland, you have to pass the bar exam in ENGLAND. I bet that sticks in Irish craws. ;)

Lawyers love the English Common Law, don't they. ;)

Peter P Says:
April 8th, 2008 at 3:52 pm
"Setting up entrance barrier for labor is NOT a good way to keep jobs here.
There is no way to stop the global wage arbitrage."

Sure there is, import tarrifs. AND, they should also be applied to American goods coming in from overseas, none of this "It's an American product made in China" nonsense.
I believe in NAFTA, but on a personal level, like Mexicans coming over here to buy things or us going over there. We shouldn't have to be hassled on a reasonable amount of goods unless they are for resale.

Sure there is, import tarrifs. AND, they should also be applied to American goods coming in from overseas, none of this “It’s an American product made in China” nonsense.

American consumers will simply move overseas.

I believe glass blowers were not conscripted in Britain - my grandfather was needed to blow glass for delicate equipment and bombs.

I think given the surge in energy price which is very likely to stick for another decade or so, NAFTA will make more sense than global trade, and that is going to be the trend.

Let's face it, there is no way you can block illegal immigrants from Mexico, it ain't gonna happen until our economic status and theirs start to reach a comparable level. Either we become poorer or they become richer, life finds a way, particularly for lives just across the border.

I really have nothing against Latinos. I prefer them to many domestic trash of different colors who are obese, stupid, lazy yet violent, and worst of all, they make themselves sound like victims. Latinos are generally happy people who work hard. I have a tremendous respect for anyone who is willing to work hard.

Call ourselves lucky. At least the Latinos speak Spanish (which is fairly easy for English speakers to pick up), have good work ethics, have good food, and have embraced the Anglo-Saxon culture. Well, imagine if we were bordering Saudi Arabia, Afghanistan, etc... things could have been a lot worse.

DinOR Says:
What is UP w/ the IMF? Why aren’t they in their usual nod-off mode?

Now that we have a third-world currency, a second rate leadership and a first rate crisis - I guess the IMF felt we qualified for their ministrations. :-)

test -- I'm having trouble posting.

OO Says:
The Japanese were not ranking the life of its citizens, it is ranking the usefulness of its citizens in a combat situation, particularly those who carried the hope of the country.

The approach is not surprising, although some of the shock-element in because in normal, polite society, we like to pretend that everyone is 'special'.

I see a lot of parallels in the way layoffs are planned when a biggish company is in trouble. First to be let go are incompetents and 'overhead' jobs like "process synergy analysts". Last to be cut are the best sales and engineering talent.

skibum Says:
do we really have so little faith in our home-grown education system that we have to import educated workers?

A couple of years ago, I volunteered at a school to coach kids in math. I encountered an entire class of eighth graders who were unsound on the concept of fractions. Nothing fancy, basic fractions. You do the math (no pun intended).

We do turn out a lot of smart, well-trained kids - and no doubt there is a *huge* number of poorly-prepared grads (who all THINK they are entitled to a well-paying job), but my guess is that the number of adequately trained graduates is not large enough to competently fill the available jobs in an economy as large as this.

The question, IMHO is - do we fix the symptom by importing better educated talent, or do we really fix the system to produce a larger volume of properly educated american kids?

[Hideously Old Topic, but I was unable to post earlier because of technical difficulties]

FAB,

I donN"t understand why a gold digger can marry a guy for a few years and after to agreeing to stay with him N4until death do us partN! break the contract (to move in with her personal trainer) and take half the guys assets…

It is because the men of the US (and California in particular) are completely asleep at the wheel when it comes to paying attention to family law and the implications of changes in same laws. No-fault divorce is a prime example.

Men in the US are so caught up in the treadmill of success (aka. competing like crazy against their brethren for the honor of banging one supermodel before they die) that they completely forget to pay attention to what is happening to their rights in society as a whole.

Here's the big question: Do you think that either the democrats or the republicans are going to make family law and marriage contracts more equitable?

I see a lot of parallels in the way layoffs are planned when a biggish company is in trouble. First to be let go are incompetents and ‘overhead’ jobs like “process synergy analysts”. Last to be cut are the best sales and engineering talent.

Is that your wishful thinking? :) Which planet are you from?

Last to be cut are people with the best political skills. Good engineers are expensive on paper and they are the first to go.

I encountered an entire class of eighth graders who were unsound on the concept of fractions.

Let's blame NYSE decimalization. :)

SP

I don't have a dog in this fight as I have no children, but certainly over the past 40 years the respect with which teachers are treated and the appartent quality of teachers has been on a downward tragectory.

I know that there are a lot of problems with the public schools in 'Murka, but do you think that a big part of it is that dedicated, but no longer top tier, individuals enter the teaching profession?

After all, if money is the barometer of respectability, and we pay teachers less than (or little more) prison guards, should we expect the "best and brightest" to enter the profession?

I don't think that the answer is simply more $$$ -- after decades of maligning teachers as marginally competent and ingraining the general meme that the only people who teach (as a career) only do so because they are incapable of anything else, are we simply reaping what we have sown?

Either that, or merkin kids are substantially dumber than they were a generation ago.

OT: There's another $600K tax money going to the drain. This Olympic torch thingy is getting more and more violent at each stop, it's going to pass through SF tomorrow and for that little stretch, we need to allocate 500 policemen to the stupid event. Chinese consulate is rallying mainland Chinese in the Bay Area to "protect the torch" (heard they paid 500 Euro pp for Paris), and the Free-Tibet hippies are also planning a big show down.

Amidst a serious economic slowdown and a very "unbalanced" local budget, the last thing SF needs is a stupid confrontation by two parties that we don't really care for. For all that $600K we need to spend, I am now hoping there will at least be some fantastic kungfu street fights for show.

600K??? WTF?

I don't care for either party. I think we should just save our dough, tie our hands and let them fight - and make a DVD out of it called "protestors went wild".

ANTI-DEFICIENCY RULES (CALIFORNIA ONLY) - FOR THOSE INTERESTED

I am not a lawyer, but I am a law student and I've taken a course in real estate finance, which is more than can be said for most lawyers.

For the benefit of academic discussion, here are the basic antideficiency rules for California:

(1) A purchase money mortgage on a 1-4 unit residential dwelling of which at least one unit is occupied by the owner is non-recourse, i.e., anti-deficiency applies. Property must have been occupied WHEN THE LOAN WAS MADE, i.e., it's too late to move into your investment property to avoid a deficiency.

(2) A seller carryback on ANY real estate [including commercial property, rental property, farm, etc.] is non-recourse.

(3) There is no deficiency following a non-judicial foreclosure. If a lender wants a deficiency, they must conduct a judicial foreclosure first. Common wisdom is that a judicial foreclosure is so time consuming and costly that very few lenders would bother to do this in a residential home loan situation, even if the borrower has assets with which a judgment might be satisfied. This applies regardless of the type or purpose of the property.

(4) If a second lien-holder (i.e., a home equity loan lender) is "sold out" by the foreclosure of the senior lien (i.e., first mortgage lender) then the second lien-holder need not foreclose before seeking a deficiency. i.e., the second lien-holder can proceed directly against the property owner for a deficiency. THIS IS PROBABLY THE MOST REALSTIC THREAT FOR MOST PROPERTY OWNERS FACING FORECLOSURE IN CALIFORNIA, IN MY OPINION. If you are going to become personally liable, this is probably how.

Note that, if the second and frist lien are held by the same company, the legal outcome is unclear under current law.

(4b) Notwithstanding rule 4, if the second loan was used to substantially improve the property (i.e., to add a second floor), it may be treated as though it were a purchase money loan and therefore anti-deficiency would apply. This is very fact sensitive and arises from a judicial doctrine.

(5) If the borrwers "wastes", i.e., trashes, vandalizes, destroys, or egregiously fails to maintain the property, borrower may lose the protection of the antideficiency statutes.

(6) This one's for the liar loan-holders out there: likewise, if the borrower has committed fraud (such as by misstating your icnome), she may lose the protection of the antideficiency rules even if they would otherwise apply.

(7) If guarantors, co-signors, or multiple items of collateral are involved in a loan, or if you have done anything else out of the ordinary, your mileage will vary and the above rules may not apply.

This is intended for the benefit of discussion on the housing market in California. If you are facing any sort of issue, see an attorney. What I have written above is for academic discussion and is not legal advice.

DinOR, thanks for refreshing that angle of human behavior. I think you've connected the atitude of not being honorable when the transaction doesn't perform with the, 'let's stick it to this guy, it's someone elses money anyway' atitude quite nicely.

More news updates on Ms Parul Vora:
===============================
Unemployment Rate Rises After 80,000 Jobs Cut
http://www.nytimes.com/2008/04/04/business/04cnd-econ.html?em&ex=1207540800&en=c1de4fb13c4ec4bd&ei=5087%0A

Until recently, Parul Vora, 28, was earning a six-figure salary as part of an elite research team at Yahoo. Ms. Vora, who has a master’s degree from the Massachusetts Institute of Technology, lost her job in early February.

“I had never been laid off and never imagined being laid off,” Ms. Vora said. “I was sad personally and professionally.”

But Ms. Vora has better prospects than most. She said she has already been wooed by several potential employers.

“There are a lot of jobs out there, but I’m pretty picky,” Ms. Vora said. “My biggest worry is finding a new job I like.”
===============================

More news updates on Ms Parul Vora:
===============================
80,000 Jobs Lost; Democrats Urge New Aid Package
http://www.nytimes.com/2008/04/05/business/05econ.html

Parul Vora, 28, who holds a master’s degree from the Massachusetts Institute of Technology, thought she was immune to unemployment — until Yahoo laid her off recently as a researcher in San Francisco earning in the low six figures.

“To me, the layoff was an introduction to the dark side of corporate life,” Ms. Vora said. “It was a reminder that at the end of the day, you are doing breakthrough research for a company that is making decisions about your life, and you have no control over those decisions.”
===============================

Peter P Says:
April 8th, 2008 at 4:25 pm
"American consumers will simply move overseas."

And? I think it speaks better of our society to have rich Americans going around the world sharing the wealth rather than turning the working class into peasant refugees going to former third world countries to beg for a job.

dogbert345,

what about refinancing? I read somewhere before that refinancing will cause the borrower to lose the anti-deficiency status because the lender always attach a fine-print on the contract calling for the borrower's consent to give up his right of anti-deficiency. Is that true?

~attitude,

sorry

There may be fine print, but it is by statute that a refi isn't purchase money.

I'd expect the fine print to be more of a disclaimer that the person is giving up that anti-deficiency status.

Parul Vora, 28, who holds a master’s degree from the Massachusetts Institute of Technology, thought she was immune to unemployment — until Yahoo laid her off recently as a researcher in San Francisco earning in the low six figures.

A master's degree? Immune to unemployment? :lol:

The only people immune to unemployment are those who create their own employment. And still, they are not immune to business losses.

Looks like the Uk is trailing the US by about 1 year. Wow, the wheels are coming off that London housing bus. Spain as well. Portugal.
The problem with housing bubbles everywhere is that it creates a world-wide consumer led recession. With fewer consumers to 'pick up the slack' this means a real loss of markets and thus a real contraction in business. China can only buy its own exports with massive inflation.
I am going back to my statement that the IMF, who has tripled their previous estimate, is still off by at factor of at least two. $2 trillion loss with a average world leverage rate of over 10%. $20 trillion in monetary deflation. You go Ben, push on that string for a while.
Using Krugman's estimates I would say Start of recession was Jan 2008 (mybe as early as October 2007 after last econmic revision) it will last 3 years with the worst part of it at Jan 2009. It will likely blunt after that as the president starts pushing for more and more New Deal works projects.
Housing prices will decline past 2010, but the bulk of the losses will be realized by winter 2010. By bulk I mean to say 10% in 2008, 10% in 2009 (we had 10% in 2007, so 30% total in 3 years) with up to 5% in 2010.
In theory we are speeding towards price correction in nominal dollars with Fed inflation, but unless wages move with inflation expectations, homes would still remain unaffordable as ioncomes fail to inflate.
I guess I am just back to reafirming my good 'ol 70s rewind. Hello 1973-1975.

OO Says:
OT: There’s another $600K tax money going to the drain. This Olympic torch thingy is ... going to pass through SF tomorrow

I agree - it would have been wiser for Gavin Newsom to have banned the genocide-torch from entering SF altogether. :-)

Peter P Says:
Is that your wishful thinking? :) Which planet are you from? Last to be cut are people with the best political skills. Good engineers are expensive on paper and they are the first to go.

Not wishful thinking at all, I have seen it myself. The top "producers" in sales and R&D are retained longer than the fluffers are. The people with the best political skills are not last to be cut, they are usually 'never to be cut'...

NYT: "Economy has become a drag on Silicon Valley"

http://www.nytimes.com/2008/04/09/technology/09silicon.html?_r=1&ref=business&oref=slogin

Ski,

Kinda confirms what we have been saying here. Do we have an estimate of the magnitude of start-ups as employers? Or how much money they splash ino secondary labor markets, like (external) marketing, finance, commercial real-estate, etc?

dogbert345 Says:

>ANTI-DEFICIENCY RULES (CALIFORNIA ONLY)
> FOR THOSE INTERESTED
> I am not a lawyer, but I am a law student and I’ve taken
> a course in real estate finance, which is more than can be
> said for most lawyers.

I’m not a lawyer either but I’ve taken a lot of real estate finance classes over the last 27 years since I got my CA real estate license (as a freshman in college) and as one of the few guys in business school with an undergraduate business degree I spent a lot of time teaching finance (and accounting) to the kids with undergraduate degrees in engineering (and romance languages)…

> (4) If a second lien-holder (i.e., a home equity loan lender)
> is “sold out” by the foreclosure of the senior lien (i.e., first
> mortgage lender) then the second lien-holder need not
> foreclose before seeking a deficiency. i.e., the second lien-
> holder can proceed directly against the property owner for
> a deficiency.

Other than the little $200K loan I got on my Burlingame home in 1996 I have never been personally involved with residential lending, but in the mid 90’s I was involved with bidding on billions of bad commercial loans and spend a lot of time talking with the guys bidding on the billions of bad home loans. I can’t say that it NEVER happened, but I have NEVER heard of anyone (with a loan secured by real estate) in California (in the past 20 years) ever actually collecting on a deficiency judgment (99.9% don’t even try to get them and just take the property back).

Then OO Says:

> dogbert345,

> what about refinancing? I read somewhere before that refinancing
> will cause the borrower to lose the anti-deficiency status because
> the lender always attach a fine-print on the contract calling for the
> borrower’s consent to give up his right of anti-deficiency. Is that true?

If you refinance you lose the “anti-deficiency status” but 99.9% of lenders will not bother with a (very expensive) judicial foreclosure since 99.999% of borrowers that destroy their credit letting a home go in to foreclosure don’t have the money to pay a judgment…

I had told about a friend's brother who was upside down on around 10+ properties. Now he seems to be using his brother (my friend) to work on some distressed properties. My friend doesn't know all the details but has put his name on some property and got some cash out for his brother to fund new investments in distressed properties. With so much of leeway in appraising properties, I believe there could be lot of fraud on the way down just like fraud on the way up.

dogbert and FAB : Thanks for the information.

but I have NEVER heard of anyone (with a loan secured by real estate) in California (in the past 20 years) ever actually collecting on a deficiency judgment (99.9% don’t even try to get them and just take the property back).

Perhaps because of the One Action Rule? Even without formal anti-deficiency protection in some mortgages, lenders are incentivized to seek foreclosure instead of litigation.

I am not an expert.

Also keep in mind, that it is only in the last couple of years that there has been a real deficit between mortgage balances and home values (in general). Don't think for a moment that people who walk from a loan that is a recourse loan are going to not get a deficiency judgement against them. Especially given that many of the stories we are reading here are people who are choosing to walk away because of the drop in value, not because of insolvency. Many of the cases are actually high earners.

Malcolm,
Yep. I think the just-walk-away crowd better not include those that think they can laugh over the loss of their 0-down spec property. They are in for a rude, rude awakening. Not only becasue it is worth it for the bank to go for the deficiency (since $1m properties may well sell for $500k) but becasue there is likely $500k in assets for the person who loses the judgement.
I think this world is very different from the one FAB remembers, if only becasue people who went upside down back then, also went under.

Okay, I must be wrong.
Now the IMF is saying the same thing I have been saying. That other nation's Central Banks better lower rates. But the IMF is awlays wrong, so I must be wrong.

Thanks Duke, it is a subtle difference that I thought worth mentioning. To YouWalkAway's credit, on their site they do try to screen their leads for eligibility on their home page.

I'm reasonably sure that the judgement can be discharged in a bankruptcy anyway which might also explain why insolvent borrowers weren't pursued relentlessly. Like you said, the numbers are way bigger this time.