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Get
Rich Quick Scheme, Rent Out Your Neighbor's Foreclosed House! - (www.palmbeachpost.com) A West Palm Beach woman is
accused of commandeering her neighbor’s empty and foreclosed-upon home, renting
it through Craigslist and collecting more than $13,000 in rent before the owner
discovered the ruse and called the cops. Nathalie Heil, 30, was booked into the
Palm Beach County Jail on Friday. Facing charges of grand theft and fraud, she
was released Saturday after posting $6,000 bond. But Heil said she believes she
has ownership of the house, stating that she filed what’s called “adverse
possession” papers. The arcane Florida law, created hundreds of years ago,
states that if a person claiming adverse possession stays in a home for seven
years, paying taxes and caring for the property, they can take permanent
ownership.
Evictions
are driving long-time renters out of their homes - (www.sfbg.com) When the housing market bounces upward, Ellis
Act evictions tend to hit long-term tenants whose monthly payments, protected
by rent control, are a comparative bargain. Even if they've submitted every
payment on time and upheld every lease obligation for 20 years, these renters
can find themselves in the bind of being forced out. And they don't just lose
their homes; often they lose their community. San Francisco has become so
expensive that many Ellis Act victims are tossed out of this city for good. Enacted
in 1986, the state law allows a landlord to stop renting units, evict all
tenants, and sell the building for another purpose. Originally construed as a
way for landlords to "go out of business" and move into their
properties, the Ellis Act instead gained notoriety as a driving force behind a
wave of evictions that slammed San Francisco during the tech boom of the late
90s. Between 1986 and 1995, just 29 Ellis evictions were filed with the San
Francisco Rent Board; in the 1999-2000 fiscal year alone, that number ballooned
to a staggering 440. Under the current tech heyday, there are indications that
Ellis Act evictions are gaining fresh momentum. The San Francisco Rent Board
recorded 81 this past fiscal year, more than double that of the previous year,
and there appears to be an upward trend.
Subprime Is Back: Will This End Badly? - (www.cnbc.com) The subprime market for risky mortgage backed
securities is hot again and its revival is exceeding many people's
expectations, the chief market strategist at Rosenblatt Securities said.
However, he expects it will end badly. The subprime mortgage crisis, which led
to the financial crash of 2008, involved institutions making loans to those
with poor credit who later had difficulty maintaining their repayment schedule.
Wall Street brokerage firm Rosenblatt, which has been monitoring the situation
since the last crisis, said the credit-led bull market is well under way. "The
subprime market's revival is proving to be even stronger than we had
anticipated," Brian Reynolds said, in a research note. "This is just
a credit cycle, and it will eventually end badly like the others." Rosenblatt
Securities has been worried before. It showed outrage when General
Motors bought AmeriCredit car loans firm in 2010. The deal
repeated the excesses of the last credit cycle, it said at the time, when GM
had to hive off its financial subsidiaries which then needed taxpayers' money
to survive.
Fed Governor Raises the Specter of a Bubble in Junk Bonds -
(www.nytimes.com) Some financial markets are
showing signs of overheated speculation as investors take larger risks in
response to the persistence of low interest rates, a senior Federal Reserve official said in a speech on
Thursday. The official, Jeremy C. Stein, a Fed governor, highlighted a surge in
junk bond issues, the popularity of certain kinds of real estate investment
trusts and shifts in bank balance sheets as areas the Fed is watching closely,
although he played down any immediate threat to the financial system or the
broader economy. “We are seeing a fairly significant pattern of
reaching-for-yield behavior emerging in corporate credit,” Mr. Stein said in
St. Louis. He added, however, “It need not follow that this risk-taking has
ominous systemic implications.”
Why Americans still feel poor - (fortune.cnn.com) U.S. stocks have reached new
highs, but most Americans probably don't feel any wealthier. That's because the
prices of our homes have a bigger influence over how rich we feel and,
therefore, how much we're willing to spend, suggests a recent study by the National Bureau of Economic Research. The findings
clarify the big drivers of what economists call "the wealth effect,"
the idea that people spend more when they have more. This sounds pretty obvious,
but the real barometer of wealth hasn't been as clear. In the past, as the
Federal Reserve moved to buy up billions of dollars worth of bonds to stimulate
the economy, Chairman Ben Bernanke said
that higher stock prices boost consumer wealth. And in turn, the extra spending
helps the economy grow.
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