Legal Blog of the Law Offices of J. Michael McBride

Lone Owner in 32 Story Condo

mcbride — Mon, 08 Mar 2010 20:29:34 +0000

“But Vangelakos, who paid $430,000 for the home, closed in November 2008 and insisted on taking possession. He, his wife Cathleen, and their three children use the condo as a vacation home when he can get away from his job as a Weehawken, N.J., firefighter…. The signs are everywhere that the building is almost abandoned. ‘They’re maintaining the pool, but they don’t heat it,’ he said. ‘I only have the lights on my floor and I’m the only one there.’ In the lighting fixtures on the open walkways on each floor, Vangelakos said, ‘Birds have been making their nests’ often leaving piles of droppings.” Of course, the real question is how can a firefighter married to a city hall clerk in Weehawken afford a $430,000 vacation home? Here is the link, complete with pictures: http://www.news-press.com/article/20100308/NEWS0110/3080347

Michael

Job Losses Continue

mcbride — Fri, 05 Mar 2010 16:51:25 +0000

As we know, the real job loss figures are worse than those that typically make the headlines in two ways. Primarily, the numbers reported do not include those people who have jobs, but are way underemployed (the PhD. waiting tables) or those who have given up on looking for a job. Second, there is a regional aspect to this in that the numbers typically reported are overall, national numbers and the jobless rates very (very much) by geographic region and perhaps by race. Thus, in certain cities or communities the jobless rate may be huge and the people living there should be prepared for food riots while in other cities, it may be much more akin to “business as usual”. That being said, here are the latest numbers on jobs: “U.S. nonfarm payrolls declined for the 25th time in the past 26 months, falling by 36,000 in February to a seasonally adjusted 129.5 million, the Labor Department estimated Friday….The nation’s jobless rate was steady at 9.7% as the number of those employed in the household survey rose by 308,000….The U6 alternative gauge of the unemployment rate, which includes discouraged workers and those forced to work part-time, rose to 16.8% from 16.5%.”

Here is a link to this unusually informative article on the jobless rate: http://www.marketwatch.com/story/payrolls-fall-36000-jobless-rate-steady-at-97-2010-03-05?reflink=MW_news_stmp

Michael

Dallas Federal Reserve President Fisher Calls for Break-up of “Too Big to Fail” Banks

mcbride — Thu, 04 Mar 2010 15:32:09 +0000

“Federal Reserve Bank of Dallas President Richard Fisher called for an international pact to break up banks whose collapse would threaten the financial system, a position that goes beyond other Fed officials. ‘The disagreeable but sound thing to do’ for firms regarded as ‘too big to fail’ would be to ‘dismantle them over time into institutions that can be prudently managed and regulated across borders,’ Fisher said in a speech at the Council on Foreign Relations in New York.”

Here is a link: http://www.bloomberg.com/apps/news?pid=20601087&sid=a9_wZHNh62z8&pos=1

Michael

Different Perspective on Gov. Perry’s Win

mcbride — Wed, 03 Mar 2010 17:00:07 +0000

Yesterday, the Texas Republican voters chose Gov. Rick Perry over both Sen. Kay Bailey Hutcheson and Debra Medina to run against Bill White, the Democratic former Mayor of Houston. This makes sense given that Gov. Perry styled his campaign perfectly to fit the worsening mood of Americans in general and voters in the Republican primary in particular. As has been said here before, according to the folks at Elliott Wave and The Socionomist – who produce two very informative financial newsletters to which I subscribe – there is a historic mood shift happening in the US and across the globe which will shortly result in a depression which will dwarf the one which we suffered through in the 1930’s. This mood shift is characterized by many things including an increased polarization (politically, socially, regionally and racially) an “us versus them” mentality and a “point the finger” blame game which will variously point at “enemies” both real and imagined, like the Federal Reserve, the “fat cats” on Wall Street, those in power generally and the federal government. If that is the case, running a political race which emphasizes a shift away from dependence on the federal government, arguing for possible secession, and blaming the primary opponent as a “Washington insider” seems like a perfect strategy. It surely worked since Governor Perry won the primary without a run off when there were two other very well positioned contenders in the primary. Others running for office should take note. Using the shifting public mood to guide your campaign strategy is the way to win in the coming bear market – at least if what I read is any guide.

Here is a link to an article on Gov. Perry’s big win: http://www.dallasnews.com/sharedcontent/dws/news/politics/state/stories/030310dntexgovrace.16dcec9d6.html

Michael

Ford Tops GM in US Sales

mcbride — Tue, 02 Mar 2010 23:20:02 +0000

For the first time in many many years, monthly US sales of Ford products has topped that of GM products. “Ford deliveries jumped 43 percent to 142,285 vehicles compared with 141,951 for GM. The Dearborn, Michigan-based company hadn’t topped GM in domestic sales since a strike idled the biggest U.S. automaker almost 12 years ago, and the last time before that was during a 1970 walkout, based on Ford data.”

Here is a link to a very through article: http://www.businessweek.com/news/2010-03-02/ford-u-s-sales-win-is-first-since-1998-as-gm-shuffles-leaders.html

Michael

Deepening Mood Reflected in “Funnies”

mcbride — Mon, 01 Mar 2010 18:28:16 +0000

The public mood shift toward darker humor and the bear market tendency to find someone to blame for the worsening economic mess is perfectly exemplified by Sunday’s Doonesbury. It starts with a kid in college dreaming of “making a difference” and cleverly takes him through his career as a banker ending with him making the commencement speech, reminding kids to hold onto their values, which he has by then totally abandoned. No, I do not think this represents all bankers (or lawyers or doctors); the point is one of the deepening bear market mood which will include “the blame game” in a huge way! Watch for large drops in all of the markets.

Here is a link: http://www.doonesbury.com/strip/dailydose/index.html?uc_full_date=20100228

Michael

Hummer Sale Goes Sideways

mcbride — Fri, 26 Feb 2010 14:54:06 +0000

The proposed sale of the Hummer brand from GM to a Chinese company has fallen through. Based on sliding sales, GM decided to sell the Hummer brand. The proposed buyer was a company named Sichuan Tengzhong Heavy Industrial Machines. Evidently the sale fell off the cliff when the possible buyer was not able to obtain the Chinese government’s approval, given a new emphasis on being green(!).

Here is a link: http://www.aolnews.com/the-point/article/sign-of-the-times-gms-hummer-hits-dead-end/19373497

Michael

More Fodder for Conspiracy Theorists

mcbride — Mon, 22 Feb 2010 19:47:15 +0000

“A new advisory being sent by America’s third largest bank to its account holders has stoked fears that major financial institutions could be preparing for old fashioned bank runs if the economy takes a turn for the worse. Originally reported by John Carney over at the Business Insider website, Citigroup is sending the following information to customers along with their bank statements. ‘Effective April 1, 2010, we reserve the right to require (7) days advance notice before permitting a withdrawal from all checking accounts. While we do not currently exercise this right and have not exercised it in the past, we are required by law to notify you of this change.’ An almost identical advisory to the one being sent out can be read on page 22 of Citbank’s Client Manual effective January 1, 2010, which can be read here from Citibank’s own website. ‘We reserve the right to require seven (7) days advance notice before permitting a withdrawal from all checking, savings and money market accounts. We currently do not exercise this right and have not exercised it in the past,’ states the manual.

Here is the link: http://www.prisonplanet.com/citigroup-warns-customers-it-may-refuse-to-allow-withdrawals.html

Michael

How Does This Work?

mcbride — Fri, 19 Feb 2010 20:47:30 +0000

I was just scanning the list of dates for the Jay Z concert tour. Get a load of this schedule: Feb 20, 22, 23, 25, 27, 28; March 2, 3, 5, 6, 7, 11, 12, 13, 14, 16, 18, 19, 20, 22, 24, 26 and 27! And each of these dates is in a different city, like NJ on the 13^th, Michigan on the 14^th! I am just not sure how this can happen! Here is a link for tickets, dates and cities: http://www.razorgator.com/tickets/concerts/hip-hop-reggae/jay-z-tickets/

Michael

Greek Mess Continues

mcbride — Fri, 19 Feb 2010 15:38:44 +0000

This is not a good situation. The European Union is making grave threats against Greek sovereignty unless it gets its economic house in order. The socialist Greek government is now making draconian spending cuts to rein in spending to get control of its economy. These cuts have caused strikes amongst workers and unions, thus crippling regular delivery of things like…gasoline. One suggested cut to a holiday is said to be seen by workers as “an act of war.” Riots from lack of services cannot be far off. “The fuel shortage was the first serious consequence of growing labor protests against the Socialist government’s emergency spending cuts program, aimed at easing the debt crisis in Greece and shoring up market confidence.

Customs workers have extended their strike against salary freezes and bonus cuts through next Wednesday, when unions across Greece will hold a general strike that is set to bring the country to a standstill. European finance ministers have told Athens it must demonstrate signs of fiscal improvement by March 16 or it will be ordered to impose even tougher budget cuts. Greece has promised to slash its deficit from an estimated 12.7 percent of gross domestic product to 8.7 percent this year.

Finance Ministry officials say they are under EU pressure to ax the public servants’ so-called ‘14th salary.’ Greek workers get their annual salary divided into 14 payments, with two of them given as holiday bonuses, in a measure originally designed to alleviate those with low incomes. ‘We would consider cutting the 14th (salary) to be an act of war,’ said Yiannis Papagopoulos, leader of Greece’s trade union umbrella group, the GSEE.”

Link: http://finance.yahoo.com/news/Fuel-shortage-hits-Greece-as-apf-1182321877.html?x=0&.v=3

Michael