The rich are not so different after all: Hamptons town struggles with $12M deficit -- Newsday.com

The rich are not so different after all: Hamptons town struggles with $12M deficit -- Newsday.com: "East Hampton, one of the main towns on the eastern end of Long Island that make up the Hamptons, is burdened with a deficit that could exceed $12 million. And that has become a rich source of irony, given the community's spectacular wealth and its concentration of Wall Street money-management talent...The town operates its own airport, where Learjets and helicopters shuttle the beautiful people to their playgrounds. East Hampton also spends $100,000 a year for a day-care program for working families and $710,000 annually for free YMCA membership for all the town's children. A theater group for the handicapped gets $30,000 a year, and there are nutrition and transportation programs for senior citizens. The town replenishes its harbors with clams, oysters and scallops and recently bought $100,000 worth of beach rakes to keep the shoreline clean. In the fall, residents do not have to bag and dispose of their leaves themselves; the town lets homeowners rake them to the curb, where a giant vacuum truck sucks them up and hauls them away at a cost estimated by McGintee at $300,000 to $400,000 a year. Over the years, town leaders have been reluctant to raise taxes, because that could harm the many working-class folks struggling to pay their bills, and hurt the politicians on Election Day, too. But now they may have to cut services and increase taxes after all."
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Sounds like some pretty imaginative and generous spending has been going. Free YMCA membership for all the kids in town? An airport? Maybe a little budget-trimming is in order.

Nobel Economist Stiglitz Outraged That Fannie (FNM), Freddie (FRE) Paying Dividend With Our Bailout Money

Nobel Economist Stiglitz Outraged That Fannie (FNM), Freddie (FRE) Paying Dividend With Our Bailout Money: "WHAT BOTHERS ME FROM THE POINT OF VIEW OF PUBLIC POLICY IS THAT FREDDIE MAC AND FANNIE MAE CAME TO THE AMERICAN TAXPAYERS, ASKED FOR THE RIGHT TO WRITE A BLANK CHECK. CONGRESS GAVE THEM THAT RIGHT. WHILE WE ARE, AS TAXPAYERS, IN A POSITION TO PUT MORE MONEY INTO FREDDIE MAC AND FANNIE MAE.THEY'RE TAKING OUT MONEY. TO ME THIS DOESN'T MAKE ANY SENSE. IF THERE IS A THREAT OR A LACK OF LIQUIDITY IN THE FIRM, WHY ARE THEY STILL PAYING DIVIDENDS AT ALL? ANY DIVIDEND."
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So, the taxpayers commit to financial support for Fannie Mae and Freddie Mac because they are having liquidity problems, i.e., not enough $$$ given the loans they have outstanding. So waht do they do? Right away they both pay dividends to their stockholders, sending $$$ out. As Stiglitz says, did they have liquidity problems or not? If yes, they need to keep that money in house and not send dividend checks to stockholders. If no, then why on earth are they getting bailed out by the taxpayers?

Prince George's raid prompts call for probe -- baltimoresun.com

Prince George's raid prompts call for probe -- baltimoresun.com: "When the shooting stopped, two dogs lay dead. A mayor sat in his boxers, hands bound behind his back. His handcuffed mother-in-law was sprawled on the kitchen floor, lying beside the body of one of the family pets that police had killed before her eyes.

After the raid, Prince George's County police officials who burst into the home of Berwyn Heights' mayor last week seized the same unopened package of marijuana that an undercover officer had delivered an hour earlier."
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All this for marijuana? Shooting the family pets seems to be a recurrent theme in these no-knock police drug raids.

Scoopit - Miami residents stay in near-condemned condos / NZ News

Scoopit - Miami residents stay in near-condemned condos / NZ News: "Only 17 residents remained in the 51-unit Cedar's Point building along Northwest 15th Street and 16th Avenue after the housing market went bust, and those living there were left to try to manage the building on their own.

After Tuesday's near forced evacuation, only 10 remain (the others will stay at hotels with aid from the Salvation Army until they find some other form of shelter)."
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Another CID dying on the vine.

Bloomberg.com: Worldwide

Morgan Stanley freezing home equity credit lines: "Aug. 6 (Bloomberg) -- Morgan Stanley, the second-biggest U.S. securities firm, told thousands of clients this week that they won't be allowed to withdraw money on their home-equity credit lines, said a person familiar with the situation.

Most of the clients had properties that have lost value, according to the person, who declined to be identified because the information isn't public. The New York-based investment bank will review home-equity lines of credit, or HELOCs, monthly from now on, the person said yesterday.

Wall Street firms including Morgan Stanley are ratcheting back on risks after the collapse of the subprime mortgage market and ensuing credit contraction saddled banks and brokerages with almost $500 billion of writedowns and losses. Consumers fell behind on home-equity credit lines at the fastest pace in two decades in the first quarter, the American Bankers Association reported last month."
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A Morgan Stanley spokesperson confirmed it but won't state the dollar value involved.

S.F. mayor proposes fines for unsorted trash

S.F. mayor proposes fines for unsorted trash: "Garbage collectors would inspect San Francisco residents' trash to make sure pizza crusts aren't mixed in with chip bags or wine bottles under a proposal by Mayor Gavin Newsom.

And if residents or businesses don't separate the coffee grounds from the newspapers, they would face fines of up to $1,000 and eventually could have their garbage service stopped.

The plan to require proper sorting of refuse would be the nation's first mandatory recycling and composting law. It would direct garbage collectors to inspect the trash to make sure it is put into the right blue, black or green bin, according to a draft of the legislation prepared by the city's Department of the Environment."
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Great. Remind me not to move to San Francisco. What bin do the leftover leeches from bass fishing go into?

I think San Francisco has become an intensely moralistic community representing the far left, and now seeks to parade its perceived moral superiority in the most public ways possible.

JS Online: Milwaukee man faces foreclosure because he didn’t pay parking fine: "Peter Tubic ignored a $50 parking fine in 2004, and on Monday, it cost him his $245,000 house. In what city officials believe is the first case of its kind, the city foreclosed on Tubic's house on W. Verona Court after repeated attempts to collect the fine - which over the years had escalated to $2,600 - had failed...Tubic takes the blame for disregarding the 15 or more notices he received seeking payment and warning of the pending foreclosure on the house, which was fully paid off, but says he had good reason. He was physically and psychologically unable to handle the situation, he says. According to the Social Security Administration, Tubic, 62, has been disabled since 2001. He has been diagnosed with psychological disorders that limit his "ability to understand, remember and carry out detailed instructions," according to documents from the administration. In addition he suffers from chronic pain caused by degenerative diseases of the knees and spine, as well as chronic respiratory disease, diabetes and obesity, among other ailments. "
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I have been observing from time to time that municipalities seem to be emulating HOAs, and this example now holds the floor as the champion.

California Forum - David Holwerk: Get out the buckets; it'll start raining money any time now - sacbee.com

California Forum - David Holwerk: Get out the buckets; it'll start raining money any time now - sacbee.com: "The defining aspect of life in California is that people here have an enduring belief that money is bound to fall from the sky any minute now."
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Fred Pilot sent this take on the California mentality. That's about one-sixth of the US population, by the way. The belief that real estate values are like an escalator that always goes up is particularly strong in California. That's why people were buying new tract homes in the desert and commuting 70 miles each way to work in LA. They thought they couldn't lose.

Is this another housing crisis? | The Sun |News|Weird

Is this another housing crisis? | The Sun |News|Weird
Check out the photo and decide for yourself.

And Now Brace For the Bigger Wave of Mortgage Defaults

And Now Brace For the Bigger Wave of Mortgage Defaults: "There are signs that the sub-prime collapse is, finally, beginning to stabilize: The rate at which delinquencies are rising has started to flatten, especially on pre-2007 vintages (in part because mortgages that are paid or or houses that are foreclosed on don't count). But now, says Vikas Bajaj at the NYT, a larger wave of prime and Alt-A defaults is likely to take over. If so, this will likely finish blowing many bank balance sheets to smithereens."
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These analysts say "the problems in the broader market may not peak for another year or two." So that means the overall economy will continue to be fragile, and any additional major shock, such as oil prices doubling if war starts with Iran, could make for memorable times.