KeNo's Housing and Economic Portal: Friday April 23 Housing and Economic stories

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Seattle Trash Collectors Make Average of $109,553 But Want More; 1,600 Apply to Haul Trash if Teamsters Strike - (Mish at globaleconomicanalysis.blogspot.com) One might think that $109,553 in this economy would be way more than enough to keep nearly anyone happy. In Seattle, it will not even keep trash collectors happy. Please consider Teamsters dump Waste Management's 'best, last, final offer': The Teamsters Local 174 says it has chosen not to accept Waste Management's 'best, last, final offer." Union spokesman Michael Gonzales said the Teamsters have submitted a new proposal with "significant movement," and have no plans to strike. Waste Management's five-year offer includes a wage increase of $1 per hour in the first year, bumping up the current pay rate of $26.29 per hour by 3.7 percent. In addition, Waste Management said it is offering a one-time $1,000 bonus to each employee if the contract is ratified by April 3. "By attaching an artificial deadline, it looks like they're trying to ram a bad contract down the sanitation workers' throats," said Brent Barrett, a yard waste driver. A bad Contract? The Teamsters Unions is a collection of overpaid fools who do not appreciate what they have.

1,600 apply to haul trash in case of Teamsters strike - (www.komonews.com) More than 1,600 people have applied to work as replacement drivers for Waste Management in case of a strike by the Teamsters, a company spokesperson said Saturday. "We're preparing to hire replacements in the event of a prolonged strike. It's part of our contingency planning," said Jackie Lang, spokeswoman for Waste Management. The company submitted what it calls its "best, last, final offer" to union garbage truck drivers represented by Teamsters Local 174, but the offer was rejected Friday by the union. Union representatives said the Teamsters are unhappy with the company's final offer and have submitted their own new proposal with "significant movement" on the issues. "The idea that the company can introduce new language and throw all kinds of changes at us and expect our members to vote on a short deadline is offensive," said Rick Hicks, secretary-treasurer of Teamsters Local 174 and lead negotiator. "From a union's perspective, this appears to be a tactic to divide the membership and force them to vote on a substandard deal," said Local 117 Secretary-Treasurer, Tracey A. Thompson. "This approach to bargaining calls into question whether the company is bargaining in good faith."

California ire over Borat bonds - (www.ft.com) Taking a page out of Greece’s playbook, the peeved treasurer of America’s largest state fired off letters this week to the chiefs of Goldman Sachs and other banksquestioning their marketing of credit default swaps on California’s debt. The instruments, he complained, “wrongly brand our bonds as a greater risk than those issued by such nations as Kazakhstan.” Insulting indeed, but who exactly should be insulted? Home to Hollywood, Californians may derive their hazy image of Kazakhstan from Sacha Baron Cohen’s satirical take on a country where he claims the main forms of entertainment include the “running of the Jew”, the sport shurik “where we take dogs, shoot them in a field and then have a party”, and where the favourite plonk is made of fermented horse urine. The real Kazakhstan, though not problem-free, looks fairly solid compared to California and many other states – a fact that should spook investors in America’s $2,800bn municipal bond market. On paper, California’s debt of $85bn supported by 37m citizens and the world’s eighth largest economy looks more manageable than Kazakhstan’s nearly $100bn heaped on its poorer population of 16m. Go beyond headline figures though and Kazakhstan, with the world’s 11th largest oil reserves, an economy that grew more than 8 per cent annually from 2002 through 2007 and unemployment of just 6.7 per cent looks positively vibrant next to the Golden State’s joblessness of 12.4 per cent.

Geithner: Fannie, Freddie Debt Isn’t Sovereign Debt - (online.wsj.com) Debt from Fannie Mae and Freddie Mac shouldn’t be considered sovereign debt, but there should be no doubt about the U.S. government’s support for the two firms, Treasury Secretary Timothy Geithner said in a recent letter to a U.S. House lawmaker. Geithner, responding to a letter from to Rep.Scott Garrett (R., N.J.), said debt from the two government-sponsored enterprises isn’t the same as U.S. Treasurys, but that support for the two firms “is crucial in helping to stabilize the housing market and the overall economy. The Treasury’s actions regarding the two firms, which have been under government control since September 2008, “should leave no uncertainty about Treasury’s commitment to support Fannie Mae and Freddie Mac,” Geithner wrote. “The Administration will take care not to pursue policies or reforms in a way that would threaten to disrupt the function or liquidity of these securities or the ability of the GSEs to honor their obligations,” Geithner wrote.

Lenders Loosen Reins on Jumbo Mortgages - (www.nytimes.com) IT may be too early to announce a thaw of the mortgage market, but some early signs have emerged, at least in one important category: jumbo loans. Mortgage industry executives say conditions are improving for those borrowing more than $729,750, the threshold for jumbo mortgages in the tristate region. Not only is it starting to get easier to qualify for these loans, they say, but rates are also coming down. Real estate brokers are hopeful. “I’m cautiously optimistic,” said Dottie Herman, the chief executive of Prudential Douglas Elliman. While Ms. Herman has not yet seen the effects of an improved jumbo-lending environment on overall property sales, “as credit loosens up, it will help that higher-end market move up,” she said. Frederick Wohlfarth, the president of Wohlfarth & Associates, a real estate broker in Manhattan, said he has already seen a 40 percent rise in sales requiring jumbo loans over last year. At the same time, Prudential’s mortgage affiliate, DE Capital Mortgage, has had a spike in activity in jumbo loans over the last few months, according to Jan William Scheck, a branch manager. “So we’ll only start to see these transactions close in the next couple of weeks,” he said.

Cash-Poor Cities Take On Unions - (online.wsj.com) Mayor Antonio Villaraigosa once organized for a teacher's union here, and later ran a branch of the American Federation of Government Employees. That makes him an unlikely advocate for cutting the benefits of the city's workers. But with the city facing a budget deficit that could drain its reserves by summer, Mayor Villaraigosa wants to re-open contract talks with 45,000 cops, firefighters, librarians and other city employees in hopes of persuading them to contribute more to their pensions and health-care costs. His deputy chief of staff, Matt Szabo, puts it bluntly: "Unions have priced themselves out of a job." In Memphis, the city's health-care committee recently recommended raising current and retired employees' health-insurance premiums by as much as 15%. And Toledo's city council last week wrung $3.1 million in concessions from its firefighters' union as part of a measure to close its budget gap. In New Jersey, outrage over state deficits helped Republican Chris Christie defeat incumbent Democrat Jon Corzine last November. A few weeks after Mr. Christie's victory, a Quinnipiac University poll found that three-fourths of state voters supported a wage freeze for state workers, and 61% favored layoffs. Last month, Gov. Christie signed a set of bills that would, among other things, cut pension benefits for future employees.