Weeding & Kittehs

Unbelievable Gap Closure

Bloomberg:California last sold general-fund backed bonds in June, when it offered about $120 million of debt for veteran’s homes. The state sold $450 million of public-works bonds in May and $5.9 billion of debt in March.

The standoff drove the extra yield investors demand on 10- year California bonds to 119 basis points above AAA rated municipal securities today from as low as 109 basis points in August, Bloomberg Fair Value Index data show. A basis point is 0.01 percentage point.

Schwarzenegger and legislative leaders will hammer out the details of the agreement when they meet again in Sacramento on Sept. 27th.

Bullshit. This is all about bond rollovers.

Bloat Don't Float

In the 1950-51 fiscal year, California had 10.6 million residents and the state general fund budget was $587 million. $55.40 per capita. Adjusted for inflation; $442.51 in 2010 dollars.

FY 2010-11 37 million residents and $83 billion. $2,243.24 per capita.

The Recession is Dead, Long Live the Recession

This is what the NBER says they used to determine the recession ended in June 2009:
Macroeconomic Advisers’ monthly GDP (June)
The Stock-Watson index of monthly GDP (June)
Their index of monthly GDI (July)
An average of their two indexes of monthly GDP and GDI (June)
Real manufacturing and trade sales (June)
Index of Industrial Production (June)
Real personal income less transfers (October)
Aggregate hours of work in the total economy (October)
Payroll survey employment (December)
Household survey employment (December)

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IMO they saw an inventory replenishment and called it a recovery. Regardless, the graph Rockefeller Institute pdf] at the top tells the real story. it is all about the health of the government sector not the whole economy.

Arrrgh! Talks Among Yerselves

Almost time to resume regular posting. California is heating up and the Great Double Dip is upon us. Finally some things worth talking about.

Stop me if you've heard this one...

From Craigslist:
http://ventura.craigslist.org/grd/1888435759.html
Completely working fountain, pump newer and active. Provides quiet water serenity flowing down seashell background.

Lions Heads in Picture are just sitting on Fountain.......They are not attached, and don't go with the fountain. If interested, a deal can be made for the lions heads as well. They are in need of tubing and water source to sput water out their mouths.

The fountain breaks down in to 3 pieces and is very heavy. Would require strentgth.

Divorcing/Moving, need to downsize, and sadly cannot take it with me this time.

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It starts small and poor but it gets bigger and more upscale. The great dispersal begins.

Welcome Hoocoodanoders

Bill and Ken are switching over. This is but a pale excuse, a shadow of the true Amber as it were but addicts don't complain.

2010 Census

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Huevos Grande

Give 'em credit. It takes a big pair to bring this one to market:
271 Myrtle Ave Oxnard, CA 93036

$/Sq. Ft.: $223
Lot Size: 0.69 Acres
Property Type: Detached, Modular/Manufactured
View: Other/See Remarks
Year Built: 2000
Community: El Rio / Nyeland Acres
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What's the big deal? Location, location, location. Here's the aerial:


Best described as "construction adjacent. Bet they don't mention the freeway is being widened. Not that it matters. Look at the sales history:

Mar 23, 2010 Changed $579,000
Feb 16, 2010 Listed $649,000
Dec 02, 2009 Sold $450,000
Jul 13, 1999 Sold $216,000

Nice flip. Fail.

HELOC I Love You Won't You Sell Me Your Gain?

Today's Ventura County Star has more than seven pages of NOTS (Notice of Trustee's Sale). The prices at roughly $5 million dollars per page. $35m worth of foreclosures in the paper toady alone. Let's look at some:

1291 Newman St Simi Valley CA 93065
4 beds, 2.0 baths, 1,740 sq ft
06/16/2005: $495,000
NOTS: $719,416.33

1676 Glider Ct Thousand Oaks CA 91320
4 beds, 3.5 baths, 2,742 sq ft
04/10/2002: $472,000
NOTS: $806,195.30

5083 Dodson St Somis CA 93066
4 beds, 2.0 baths, 2,362 sq ft
12/23/2002: $393,000
NOTS: $766,737.25

All these last sold at prices much lower than the foreclosure price. You have to wonder how many have seconds, HELOCs, thirds, etc. that aren't even counted having already been written off to zero.

Desert Living Large

10131 JENNY St, Hesperia, CA 92344

I said living large. I mean that two ways.
BEDS: 6
BATHS: 4
SQ. FT.: 4,246
$/SQ. FT.: $90
LOT SIZE: 1.86 Acres

Too bad the people who bought it for $282k in January want $382k now.
Date Event Price Appreciation Source
Mar 18, 2010 Listed $382,500 -- MRMLS #C10029262
Jan 07, 2010 Sold (Public Records) $284,025 -15.5%/yr Public Records
Feb 04, 2005 Sold (Public Records) $650,000 22.6%/yr Public Records

Good luck with that flippers.

Bad Teacher

LATimes: CalSTRS' $130-billion investment portfolio lost more than a quarter of its value in the recent recession. The projected shortfall at the state's second-largest public pension fund ballooned to $43 billion by last June.

"There's no doubt about it -- we need to come up with a new financial plan," Ehnes said.

The 97-year-old pension plan must ask the state Legislature, the governor and taxpayers for billions of dollars. Getting that money -- even with an expected massive lobbying campaign and a bruising political battle -- is no sure thing.
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Must be nice to gamble with OPM.

Half Off!

I love my neighborhood and it looks like we'll have some new neighbors at 3153 CalleDe Marejada:

Sprawling Single Story Custom Estate Home, 5 bedrooms, spacious office, 6.5 baths, 3 fireplaces, vaulted ceilings, granite, new stainless steel appliances, crown molding, surround sound speakers, etc. Too many features to list! Awesome backyard featuring covered patios, pool & spa, guest house w/ 2 bedrooms, bath & kitchen, flagstone pathways, pool bath, gazebo and outdoor kitchen island ready to add appliances. 4 car garage with paver motorcourt & half-circle drive.

Date Event Price Appreciation
Mar 10, 2010 Listed $1,599,800 -- VCRDS #10003829
Oct 28, 2009 Sold (Public Records) $1,360,000 -17.3%/yr
Jun 02, 2006 Sold (Public Records) $2,600,000 103.8%/yr
Aug 08, 2003 Sold (Public Records) $350,000 1.2%/yr
Oct 13, 1989 Sold (Public Records) $295,000
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I did the math. The previous owners lost $1000 per day.

CRE Hopium

Craigslist find:

RESTAURANT FOR SALE
Price: $150,000
This furnished restaurant is ready to go right now with an Outdoor Grill and food service area. Kitchen needs some remodeling work to become fully functional.There are 5,200 Sq. Ft inside and a large outside patio with a fire pit. It overlooks the habor and the boat docks, attacking herds of people to the location. Inside there is a fireplace area to relax in and a beautiful rock waterfall area to sit and enjoy a cocktail and meal.

This restaurant recently closed due to poor management....
... the rent is only $2.24 a Sq. Ft (including the patio Sq. Ft)
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Eh. What could go wrong?

The Definition of Insanity

... is doing the same thing over and over expecting a different result.

Does anyone still care except for waiting for the inevitable?

Go Amazon!

Amazon Dumps Colorado Affliates
[From Inc.]

Mr. Cause meet Mr. Effect. Last week, the governor of Colorado signed a new law levying sales taxes on online retailers.

Amazon has officially balked.

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The States are desperate for revenue no matter the cost. That never ends well.

California Default Watch II

March 8 (Bloomberg) -- California Treasurer Bill Lockyer’s bid to sell $2 billion of bonds this week, his first issue since November, may benefit from a falling risk premium after lawmakers at his urging passed a bill to prevent the most- populous U.S. state from running out of cash.
A special session of the Legislature approved measures to chip away at a $20 billion budget deficit and give state officials powers to put off as much as $5 billion in spending. The delays are intended to sidestep cash shortfalls like those last year that forced the state to issue IOUs to pay bills and triggered cuts to its credit rating.
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And an excellent blogger I haven't mentioned in a long time, Of Two Minds:

Why California Is Doomed (March 9, 2010)

California is doomed for two simple but profound reasons: the cost structure is too high for most businesses to survive, and a boom-dependent economy.

The dysfunctions crippling California would easily fill a volume: a dysfunctional Legislature that has been gerrymandered to protect virtually every seat; a dysfunctional proposition system which enables special interests to craft Protected Fiefdoms via the ballot box; recalcitrant public unions who don't see anything wrong with public servants getting 90% of top-pay in pensions while still earning big bucks as "contract employees," an enormous population of undocumented workers who pay only sales taxes, and whose employers pay no payroll taxes, either-- and that just scratches the surface.
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Thieving Rat B@st@rds

Stealing. There's no other word for it. No matter how they torture the language in the end the legislature has taken money out of the Stat highway Trust Fund and used it to cover general fund debt payments. It gets a little complex and involves weird concepts like different kinds of money but follow me here.

From Businessweek:
The swap allows some accounting maneuvers that would funnel more money into the state's general fund, where the deficit exists.

The tax exchange is estimated to generate $1.1 billion for the general fund while continuing to provide close to the current level of funding for public transit and repairs to highways and streets.

Californians would see no difference in prices at the pump.

Bullshit. The Trust Fund carries a close to $9 billion balance. The State won't spend it because as long as it sits there it helps balance the bookson paper. What about on the streets? KTLA:

Huge Pothole Flattens Tires On 101 Freeway
KTLA News7:17 AM PST, March 1, 2010

The 101 south through downtown was closed by a massive pothole. (February 28, 2010)

LOS ANGELES - Late last year, a national transportation research group stated that Los Angeles had the worst roads in the nation.

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They robbed the Trust fund and we pay twice.

Hope Springs Eternal

Oxnard
Feb 06, 2010 Listed $559,900 -- VCRDS #10002095
Dec 10, 2009 Sold (Public Records) $490,000 14.5%/yr
May 29, 2003 Sold (Public Records) $202,500 -31.4%/yr
Oct 08, 2001 Sold (Public Records) $375,000 5.7%/yr
Nov 16, 1993 Sold (Public Records) $242,000 --

I imagine the 2003 price was a divorce split.

2004-2009 Total assessed value: = $541,708 = $552,542 = $563,592 = $574,863 = $586,359 = $495,000

We'll watch this flip closely. Here are the neighboring zillow comps:

GRM 13.8

GRM is gross rent multiplier. That means annual rent as a ratio to purchase price.

$2,200,000. That's $220,000 per apartment. Now, I prefer the other GRM, monthly, not annually. Multiply by 12 is all. That's 165. In other words in this market 40% overpriced for a recovery. 60% overpriced for rent deflation expectations. They claim $ $13,000/mo in rent receipts. Taxes would eat the first $2000 every month. Ouch. Debt service also says 40% overpriced on a cash flow basis.

Hope springs eternal.

Craigslist Laugh of the Day

2008 TOYOTA PRIUS, NO MONEY DOWN, TAKE OVER MY PAYMENTS - $1 (Thousand Oaks)
Date: 2010-02-24, 10:57AM PST

I have a 2008 Toyota Prius that is the top of the line version, loaded with leather seats, nav, premium Bose 6 disc CD stereo/speaker system.
It is white, and is in pristine condition.
Has 21,400 miles currently.
My wife and I are having our 2nd baby soon, and the Prius is just too small for us now, and we don't drive enough to get the savings on the gas.
So we want to have someone take over the loan and payments on the car.
This is a great deal for someone who doesn't want to put a bunch of money down, and get a great car with low mileage.
The car has always been serviced at Toyota of Thousand Oaks, where it was purchased, and there have been no problems.
It was just serviced and they did check the gas pedal just in case last week.
Clean title and no accidents, of course.
Payments are $607.11 per month including tax, and the loan has 53 months left.
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$607.11 x 53 = $32,176.83

Brand new '10 Prius? 3-12 thousand dollars cheaper. Pathetic.