Sunday February 6 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Cantor: ‘No Federal Bailout of States’. - (online.wsj.com) House Majority Leader Eric Cantor ruled out any congressionally authorized bailouts for states struggling to balance their budgets under the weight of mounting entitlement costs and dwindling tax revenue. “There will not be a federal bailout of the states,” the Virginia Republican told reporters Monday afternoon. The new majority leader also opposes any push to grant states the right to declare bankruptcy, a move favored by many conservatives because it would give local politicians the leverage to re-work long-term compensation, retirement and health care benefits for state workers. Mr. Cantor argued that states have all “the requisite tools” to balance their budgets every one or two years, as many states require. He cited the examples of New Jersey and his native Virginia, where Republican Gov. Bob McDonnell wants to require all state employees to contribute to their retirement accounts. States with yawning deficits have seen the cost of paying off that debt rise in the last year. To appease the bond market, some have taken relatively drastic measures to increase revenue or cut spending. For example, Illinois recently increased its income tax from 3% to 5%, a 66% increase.

Obama Said to Call for 5-Year Federal Spending Freeze - (www.bloomberg.com) President Barack Obama will propose tonight a five-year freeze of non-security discretionary spending as a way to reduce the federal government’s budget deficit. Obama plans to offer the freeze in his annual State of the Union address to Congress, Melody Barnes, director of the president’s domestic policy council, said in a Bloomberg Television interview. It would extend a three-year freeze Obama proposed last year by an additional two years, to 2015. Obama will also look for savings in security and defense spending, and will endorse a proposal by Defense SecretaryRobert Gates to cut $78 billion from the Pentagon budget over five years, Barnes said.

Bank Valuations Stuck at 2009 Lows Shows No Recovery - (www.bloomberg.com) Valuations for U.S. financial stocks have fallen so far, it’s like the rebound from the worst crisis since the 1930s never happened. Banks, insurers and asset managers in the Standard & Poor’s 500 Index trade at 12.3 times estimated earnings, close to the lowest level since the bull market began in March 2009, according to data compiled by Bloomberg. The group is the second-cheapest among 10 industries in the gauge even as analysts say profits will rise 18 percent this year, exceeding the S&P 500, data compiled by Bloomberg show. While the biggest equity rally in more than five decades has lifted the S&P 500 above its level when Lehman Brothers Holdings Inc. collapsed in September 2008, the failure of price- earnings ratios to widen is a sign to Pioneer Investments and Gamco Investors Inc. that gains in banks may end when government stimulus ends. Bulls such as OppenheimerFunds Inc. say forecasts for a three-year economic expansion mean the stocks will prove bargains as earnings and dividends increase.

Sandy Weill: The Man Who Shattered Our Economy - (www.truthdig.com) Sandy Weill just picked up a humdinger of a wine vineyard estate in Sonoma, Calif., for a record $31 million, so the foreclosure crisis—which the former CEO of Citigroup did so much to create when he successfully lobbied then-President Bill Clinton to sign off on radical deregulation of the banking industry—must be over. After all, Weill wasn’t desperate for shelter, already being in possession of a 14-acre estate in über-exclusive Greenwich, Conn., and a 120-acre spread in New York state’s Adirondacks. Let’s also not forget the penthouse that he bought for $42.4 million in New York City in 2007 as the banking collapse he helped engineer was fast developing. Not too shabby for a guy who ran Citigroup into the ground by trafficking in what proved to be toxic mortgage-based securities. Thanks to legislation that Weill got President Clinton to sign off on, Citigroup was allowed to become too big to fail, and when fail it did, the taxpayers had to bail the humongous bank out—to the tune of $50 billion in a direct subsidy and $306 billion more for the housing mortgage- backed securities Citigroup was holding. The Treasury still owns a good chunk of Citigroup common stock, now trading at a paltry four dollars and change per share. However, like all of the other top dogs involved in this scandal, Weill has emerged from a housing crisis that has impoverished tens of millions of Americans with his own personal fortune intact. Indeed, as evidenced by his vineyard purchase, he has quite a bit of money to throw around. Although the value of most housing in Sonoma County, in the heart of the wine country, is down 30 to 50 percent, Weill was willing to pay close to the asking price for his new property. And why not? As the San Francisco Chronicle website quoted one Coldwell Banker real estate agent as saying, the sale “is not an indicator of an emerging real estate recovery, but rather the ability of the world’s wealthiest individuals to buy what they desire.”

California Trailer-Park Owners Fight to End Rent Control - (www.time.com) For the past 28 years in Goleta, Calif., manufacturing engineer Kenneth Tatro has lived in Rancho Mobile Home Estates, where he could afford to raise his four children in a beachside community in which home prices are typically out of reach for the middle class. He retired a few years ago to enjoy peaceful walks with his wife and his dog Kayla, but today Tatro — who is 71 years old and the president of his park's home-owners association — finds himself on the front lines of a war over California's nearly 5,000 mobile-home parks, where as many as 1 million people live under roofs they own but on top of land they rent. "They are going after the weakest and most vulnerable prey: our demographic, with our captive housing and financial position," explains Tatro of the battle, which pits low-income and middle-class people like him against wealthier opponents, the owners of the park land. "However, we are coming back at them straight up. They have not seen the fight we are [giving them] and will continue to give them."

OTHER STORIES:

Consumer Confidence in U.S. Rose More Than Forecast - (www.bloomberg.com)

Home Prices in U.S. Declined 1.6% From Year Earlier- (www.bloomberg.com)

Fed Likely to Press On With QE Even as Business Lending Rises - (www.bloomberg.com)

Never Trust a Real Estate Economist - (www.unconventionaleconomist.com)

Why Credit Deflation Is More Likely than Mass Inflation - (www.libertarianpapers.org)

Zombie Money Kills Real People - (theautomaticearth.blogspot.com)

Bernanke bond plan faces more skeptics within Fed - (www.news.yahoo.com/s/ap)

IMF Raises 2011 GDP Estimates on Stronger U.S. Growth - (www.bloomberg.com)

The Fed and the Long Bond - (www.ft.com)

Chinese President Hu Questions Dollar - (www.online.wsj.com)

How retirement is being reinvented worldwide - (www.csmonitor.com)

The Age of De-Leveraging - (www.cravensbrothers.com)

Boston Fed president calls housing market "moribund" - (www.marketwatch.com)
Fed Officials Saw Housing Bubble in 2005, Didn't Alter Policy - (www.bloomberg.com)
Hedge funds bet China is bubble close to bursting - (www.telegraph.co.uk)

Saturday February 5 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Mortgage Giants Leave Legal Bills to the Taxpayers - (www.nytimes.com) Since the government took over Fannie Mae and Freddie Mac, taxpayers have spent more than $160 million defending the mortgage finance companies and their former top executives in civil lawsuits accusing them of fraud. The cost was a closely guarded secret until last week, when the companies and their regulator produced an accounting at the request of Congress. The bulk of those expenditures — $132 million — went to defend Fannie Mae and its officials in various securities suits and government investigations into accounting irregularities that occurred years before the subprime lending crisis erupted. The legal payments show no sign of abating. Documents reviewed by The New York Times indicate that taxpayers have paid $24.2 million to law firms defending three of Fannie’s former top executives: Franklin D. Raines, its former chief executive; Timothy Howard, its former chief financial officer; and Leanne Spencer, the former controller.

Warning From S&P on Munis - (online.wsj.com) Downgrades of bonds issued by state and local governments could increase this year, according to a report to be issued Monday by credit-rating agency Standard & Poor's. The $2.9 trillion municipal-bond market has been thrown into tumult in recent months, in part because of growing fears that some state and local governments will default on their debt. Investors have pulled out record amounts from muni-bond mutual funds, while the yields on muni bonds, which move inversely to price, have hit their highest levels since the depths of the financial crisis. A downgrade of a government borrower would likely put downward pressure on the price of its bonds, resulting in higher borrowing costs and potential losses for investors. Standard & Poor's says it expects greater muni-market volatility this year, but cautions that a rise in borrowing costs wouldn't add to municipalities' credit concerns unless bond yields were to surge. While rating downgrades may increase in 2011 compared with recent years, S&P says the majority of state and local government borrowers will maintain their medium to high investment-grade ratings.

Rahm Emanuel Can't Run for Chicago Mayor: Court - (www.cnbc.com) A lawyer for Rahm Emanuel says the former White House chief of staff will appeal a ruling that says his name can't appear on the ballot for Chicago mayor. The lawyer, Mike Kasper, said that they will take the case to the Illinois Supreme Court. Earlier Monday, an Illinois Appeals Court ruled that Emanuel's name can't appear on the ballot for Chicago mayor because he didn't live in the city in the year before the election. The court voted 2-1 to overturn a judge's ruling to keep Emanuel's name on the Feb. 22 ballot. Those challenging Emanuel's candidacy have argued that the Democrat doesn't meet the one-year residency requirement because he rented out his Chicago home and moved his family to Washington to work for President Barack Obama for nearly two years. Emanuel has said he always intended to return to Chicago and was only living in Washington at the request of the president.

Foreclosures in Colo. mountains scaling record heights - (www.denverpost.com) Seven bedridden years after tumbling from a rooftop, Terry Counterman can walk again but could soon lose his Carbondale home in a foreclosure sale. "I've been sending them paperwork and forms for two years. Someone from the bank calls five, six times a day, telling me to send them more forms. I'm sending them all the money I have, and they say it's not enough," said the 63-year-old former roofing inspector, whose lender plans to sell his home of 30 years next month. "I didn't buy this place as an investment. I bought it as my home." On Garfield County's tally of foreclosures, Counterman's bank reports he owes about $67,000 on his loan. He's one of an unprecedented number of homeowners in Colorado's high country who are battling foreclosure. The crush of foreclosure filings in mountain communities continued through 2010, eclipsing not just the records from the previous year but the fallout from the formidable crash of the mid-1980s.

Licensed Realtor Indicted in Massive Mortgage Fraud - (www.enewspf.com) Six defendants were indicted January 12 on federal charges alleging that they participated in a $15 million mortgage fraud scheme involving more than 40 residential properties located in Chicago and south suburbs, federal law enforcement officials announced today. The defendants include two licensed realtors and a licensed loan officer who bought and sold homes, recruited others to act as residential purchasers, and allegedly caused various financial institutions to lose approximately $4.5 million on mortgage loans that were not repaid by the borrowers or fully recovered through subsequent foreclosure sales. According to the indictment, the lead defendant, Wanda Rivera-Burton, a licensed realtor, was employed as a loan originator and also owned a real estate company, Options-R-Us Realty, as well as co-owned B&W Investments and Property management, Inc., with co-defendant and loan officer Brenda Tibbs. Another defendant, Lynette Johnson, was a licensed realtor employed by Options-R-Us Realty and owned World Investment and Management, the FBI says. River-Burton, 39, of Chicago, was charged with seven counts of bank fraud, two counts of wire fraud, and one count of mail fraud in a 10-count indictment that was returned today by a federal grand jury. Tibbs, 55, of Tinley Park, was charged with two counts of bank fraud, and Johnson, 55, of Chicago, was charged with three counts of bank fraud and one count each of wire and mail fraud. Also indicted on one count of bank fraud each were Viktor Blanks, 51, of Oak Lawn, Dina Dunn, 48, of Chicago; and Nathaniel Maxwell, 34, of Chicago. All six defendants will be ordered to appear for arraignment in U.S. District Court.

OTHER STORIES:

Spain’s Deficit Progress Creates Cushion for Cajas: Euro Credit - (www.bloomberg.com)

California’s Sutter Health Leads Week’s Debt Sales: Muni Credit- (www.bloomberg.com)

Metals Traders Worth $3 Million at Wall Street Banks - (www.bloomberg.com)

Is Steep Yield Curve Signaling Pain to Come? - (online.wsj.com)

Global Price Fears Mount - (online.wsj.com)

Steel price forecast to rise by up to two-thirds - (www.ft.com)

Global economic uncertainty leaves oil outlook in limbo - (www.ft.com)

Trichet Signals ECB May Look Through Temporary Inflation Jump - (www.bloomberg.com)

Kan Says Japan Must Shoulder Rising Welfare Cost, Embrace Trade - (www.bloomberg.com)

Increasingly Confident Fed Is Set for First Meeting of 2011 - (www.nytimes.com)

Protecting Profits at a Price - (online.wsj.com)

New Push at Fed to Set an Official Inflation Goal - (online.wsj.com)

Friday February 4 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Nightmare on Wall Street - (www.huffingtonpost.com) In a ruling that could be historic, the Supreme Judicial Court of Massachusetts ruled against two fraudster banks, US Bancorp and Wells Fargo, who illegally foreclosed on homes. In short, the two banks stole homes to which they had no legal claim. This rattled stock markets, causing the broad-based KBW Bank Index to fall by 2.2%, with Wells Fargo's stock prices falling by 3.4% as markets began to recognize that "business as usual" theft of American homes by banksters will be subject to greater scrutiny. Tellingly, the banks have been arguing that they are following industry practice. The ruling in Massachusetts (one of the most respected Supreme Courts in the US) affirms that industry practice is fraudulent. Perhaps as many as 66 million mortgages (those tainted by improper industry recording procedures) could be affected by the ruling.

Homedebtor Tricks To Get Out of Paying Mortgage - (www.wsbtv.com) A Channel 2 Action News Investigation has uncovered a new scheme homeowners are using to avoid foreclosure. It involves canceling their own mortgage, and some homeowners told Investigative Reporter Jodie Fleischer it’s working. But at least one local official calls it fraud. The Internet is flooded with offers promising to help save your house. Susan Weidman started her research after losing her husband to a brain tumor. With mounting bills, she didn’t want to lose her home, too. “I didn’t really set out to think that I could possibly get a free house. I just wanted to stall,” Weidman said. Weidman said she hasn’t paid her mortgage in a year. She received several foreclosure notices but the sale never happened. “I’d like to think it was the paperwork I filed all right, because everything I filed was basically with fair warning and asking them questions that they refused to answer,” she said. Weidman filed several documents with the Cobb County clerk of court including a document that challenged the mortgage and another that revoked her power of attorney.

Responsibility: But Didn't The Borrower Sign The Mortgage? - (www.ourbroker.com) It hardly seems unfair. Aren’t borrowers responsible for the loans they take out? It’s not like someone is held at gunpoint and forced to accept the worst loan lenders can concoct. That’s the thinking of a considerable segment of the population, a segment represented in some of the email I receive as well as in the ethics classes I teach for real estate brokers. Borrowers, according to such logic, should not be bailed out. They signed up for a loan and if it had woeful terms it was the borrower’s job to know better. Let the market take its course; if people fail they’ll know better the next time. Besides, individual responsibility counts. It’s not up the government to rescue people who made bad financial decisions goes such thinking, especially real estate investors. As President Bush said in August 2007, “it’s not the government’s job to bail out speculators, or those who made the decision to buy a home they knew they could never afford.”

US Banks Report Phantom Income on $1.4 Trillion Delinquent Mortgages - (globaleconomicanalysis.blogspot.com) Robert Lenzner at Forbes writes US Banks Reporting Phantom Income on $1.4 Trillion Delinquent Mortgages. The giant US banks have been bailed out again from huge potential writeoffs by loosey-goosey accounting accepted by the accounting profession and the regulators. They are allowed to accrue interest on non-performing mortgages ” until the actual foreclosure takes place, which on average takes about 16 months. All the phantom interest that is not actually collected is booked as income until the actual act of foreclosure. As a result, many bank financial statements actually look much better than they actually are. At foreclosure all the phantom income comes off the books of the banks. This means that Bank of America, Citigroup, JP Morgan and Wells Fargo, among hundreds of other smaller institutions, can report interest due them, but not paid, on an estimated $1.4 trillion of face value mortgages on the 7 million homes that are in the process of being foreclosed.

Prime Southern CA Cities Tipping Downward - (www.doctorhousingbubble.com) It looks like certain mid-tier California markets like Culver City are starting to see some of this behavior. Culver Citynow has a flood of condos on the market selling in the $100,000 range which only a few years ago would have seemed nearly impossible. Yet as we now know with the California budget once reality hits prices have to come in line with revenues or cuts have to be made. Now these examples are becoming more and more common and I believe we will see a price correction in many of these markets in 2011. This is similar to the Beverly Hills home on the market in the $500,000 range. Today we will look at a home, an actual single family residential in Culver City that has cracked the $300,000 mark.

OTHER STORIES:

An easy inflation-killing idea: Save the penny - (www.theglobeandmail.com)

Many Rich People Don't Feel Very Rich; Only a few get most income - (www.nytimes.com)

Shiller: Expect House Prices to Decline in 2011 - (www.youtube.com)

Foreclosure ruling may be good news for homedebtors - (www.marketwatch.com)

Banks foreclose on rental property owners with excellent payment histories - (www.4closurefraud.org)

Public strongly opposes debt ceiling increase - (www.reuters.com)

Will Raising the Debt Ceiling Bail Out the Banks, Again? - (www.usawatchdog.com)

Despite QE2, Interest Rates Will Likely Keep Rising - (www.dailyfinance.com)

Few foreclosures, no bank failures in Canada because no mortgage deduction - (www.mcclatchydc.com)

Thursday February 3 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

House price drops exceed Great Depression - (www.reuters.com) Home prices fell for the 53rd consecutive month in November, taking the decline past that of the Great Depression for the first time in the prolonged housing slump, according to Zillow. Home prices have fallen 26 percent since their peak in 2006, exceeding the 25.9 percent drop registered in the five years between 1928 and 1933, the housing data company said in a report on Monday. Prices fell 0.8 percent over the month. It is a dubious milestone for the U.S. housing market which has failed to gain much traction despite a host of government programs to reduce delinquencies and encourage demand with temporary tax credits and lower interest rates. Many economists expect further price drops, even if there are some anecdotal signs of growing demand, such as in pending home sales data.

House sales languish in Las Vegas - (www.upack.com) At 14.3 percent, Nevada has the highest unemployment in the country. The latest housing report won't do the Silver State's jobless rate any favors. According to Local Market Monitor, a real estate analysis company founded in 1990, Las Vegas is the worst place to buy a house in the country due primarily to its high unemployment rate. Speaking to CNNMoney.com, Local Market Monitor's COO Carolyn Beggs said Las Vegas has a lot of jobs in the manufacturing and construction industries, but because those markets have been so volatile, it's hard for job seekers to land a stable position. Meanwhile, Las Vegas area homes are also one of the country's best buys.

Downturn's Ugly Trademark: Steep, Lasting Drop in Wages - (online.wsj.com) In California, former auto worker Maria Gregg was out of work five months last year before landing a new job—at a nearly 20% pay cut. In Massachusetts, Kevin Cronan, who lost his $150,000-a-year job as a money manager in early 2009, is now frothing cappuccinos at a Starbucks for $8.85 an hour. In Wisconsin, Dale Szabo, a former manufacturing manager with two master's degrees, has been searching years for a job comparable to the one he lost in 2003. He's now a school janitor. They are among the lucky. There are 14.5 million people on the unemployment rolls, including 6.4 million who have been jobless for more than six months. But the decline in their fortunes points to a signature outcome of the long downturn in the labor market. Even at times of high unemployment in the past, wages have been very slow to fall; economists describe them as "sticky." To an extent rarely seen in recessions since the Great Depression, wages for a swath of the labor force this time have taken a sharp and swift fall. Dale Szabo, who has two master's degrees, lost a job as a manufacturing manager in 2003. In late 2005 he took a job as a school janitor: 'I never dreamed I would be doing it. But I have to pay the bills.' The only other downturn since the Depression to see similarly large wage cuts was the 1981-82 recession. But the latest downturn is already eclipsing that one.

Young refuse to pay debts incurred by the old - (www.bloomberg.com) “You say you want a revolution,” the Beatles sang in a song that was released in the year that students across Europefamously took to the streets to protest against the established order. It may not quite be 1968 all over again. Even so, there is a whiff of youthful rebellion in the air. Young people across the region have been staging angry demonstrations in the last few months as government austerity measures take effect. The kids have a better case than their parents did. Even if they are doing so incoherently, the protesters are making a valid point: Europe’s young are being offered a rotten deal. What we are witnessing may well be the first shots in a long generational war. Whereas the last century was dominated by a battle between classes over how to divide up the economic pie, this one may be over how you divide it up between generations. The protests have been hard to ignore. Greek students took to the streets in October over harsh budget cuts. In the U.K., plans to triple university fees provoked riots. Demonstrators attempted to smash their way into the Treasury and attacked a car carrying Prince Charles and his wife, Camilla, through central London.

Accounting Tweak Could Save Fed From Losses - (www.cnbc.com) Concerns that the Federal Reserve could suffer losses on its massive bond holdings may have driven the central bank to adopt a little-noticed accounting change with huge implications: it makes insolvency much less likely. The significant shift was tucked quietly into the Fed's weekly report on its balance sheet and phrased in such technical terms that it was not even reported by financial media when originally announced on Jan. 6. "Could the Fed go broke? The answer to this question was 'Yes,' but is now 'No,'" said Raymond Stone, managing director at Stone & McCarthy in Princeton, New Jersey. "An accounting methodology change at the central bank will allow the Fed to incur losses, even substantial losses, without eroding its capital." The change essentially allows the Fed to denote losses by the various regional reserve banks that make up the Fed system as a liability to the Treasury rather than a hit to its capital. It would then simply direct future profits from Fed operations toward that liability. "Any future losses the Fed may incur will now show up as a negative liability as opposed to a reduction in Fed capital, thereby making a negative capital situation technically impossible," said Brian Smedley, a rates strategist at Bank of America-Merrill Lynch and a former New York Fed staffer.

OTHER STORIES:

Jobless claims top 600,000 in November - (www.economy.ocregister.com)

Job Openings in U.S. Fall by 80,000 to 3.25 Million - (www.bloomberg.com)

Corporate Communism Is Killing Us - (old but true - www.businessinsider.com)

Reclaim Democracy for the People! - (www.citizensamendment.org)

House prices fall for fourth straight month - (www.upack.com)

No U.S. housing inflation until 2012 - (www.wildly optimistic) - (www.financialpost.com)

ZipRealty closing 11 unprofitable offices - (www.thebusinessjournal.com)

The future belongs to the adaptable - (www.theautomaticearth.blogspot.com)

France's Sarkozy Brings Message on Dollar to US - (www.nytimes.com)

Japan Will Buy Euro-Region Bonds, Joining China in Assisting Irish Bailout - (www.bloomberg.com)

California Treasurer Spanks Legislature - (www.youtube.com)

Wednesday February 2 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

You Think Houses Are a Slow Sell? Try a Yacht - (www.nytimes.com) What is tougher than having one sleek mega-yacht for sale in a glutted market? The answer, for the moment at least, is having two mega-yachts on the market. In boom times, yacht enthusiasts would order a new dream boat and keep their old one for the two or three years the builder needed to complete the new boat. Then, they would quickly sell the older yacht to impatient new millionaires and billionaires eager for their requisite status symbols. But that equation changed with the financial crisis two years ago and took the super-yacht market down with it. Some of the wealthy have ended up like Peter A. Hochfelder, the principal and founder of Brahman Capital Management, a private investment firm in Manhattan. Mr. Hochfelder already owned a 134-foot Lürssen, named Blind Date, that was built in 1995. He commissioned a second boat in 2007, a 161-foot Trinity yacht, that he christened with the same name. It was completed in 2009.

Legal confusion and uncertainty now surrounds the housing market - (www.thestreet.com) The latest sword placed in the heart of the housing market occurred on Friday with the first high court ruling against banks and in favor of homeowners in Massachusetts, which ruled that there was no legal right to foreclose because assignment was not done properly -- again, questioning the integrity of the home title chain, the legal right to have foreclosed on 3 million homes since 2007 and the right to foreclose on another 8 million homes that are currently in the distressed/foreclosed pipeline. In addition to this verdict's immediate impact, it brings about death by a thousand cuts ... the litigation phase of the foreclosure crisis is going to get out of control. Homeowners, originators, underwriters, trustees, servicers, title companies, MI firms and everybody else involved in the origination, funding, securitization, servicing and insuring spaces will be suing everybody else. Multiple, big cases will come from state AG's, and class action suits will be announced daily. -- Mark Hanson.

Massive legal confusion and uncertainty now surrounds the housing market, and with the recent rise in interest (and mortgage) rates, how anyone can make an optimistic housing forecast (or any forecast at all!) is beyond me. For housing, it's (very) different this time.

Brooke Astor Apartment to Sell For $27M Off? - (www.nypost.com) A mystery buyer has agreed in writing to obtain the late Brooke Astor's Park Avenue home -- but for way less than half of the original $46 million asking price. The Upper East Side building's co-op board has yet to accept the bid, which a source described as "in the high teens." In the meantime, the sprawling duplex on the 15th and 16th floors of the classic 1931 Rosario Candela building has been shown to other interested parties -- in an attempt to raise the bid past $20 million, said sources who have toured the unit. As one broker put it, Astor's estate is "simply dying to get another bid." That the low offer was accepted at all suggests Astor's son, Anthony Marshall, and his wife, Charlene, "are desperate for money," the broker said.

The Post reported last year that Marshall, 86, owed $7 million in legal fees. And those bills continue to mount since he's appealing his conviction on charges of trying to swindle his mom out of $60 million -- and is enmeshed in an epic legal battle over how much he's entitled to from the estate.

A Lawsuit That Dirty Debt Collectors Should Be Worried About - (www.dailyfinance.com) Federal Circuit Court Judge Denny Chin just issued an opinion in a consumer class action case that should send chills down the spines of debt collectors, perhaps including foreclosure-mill law firms and their process servers, nationwide. Judge Chin decided that plaintiffs alleged enough information about the debt collectors in this case -- a law firm, a process-serving company and a debt-buying company -- to sue them for being a criminal enterprise under the Racketeer Influenced Corrupt Organization (RICO) law. Judge Chin also allowed claims under the Fair Debt Collection Practices Act. Why should other companies in and related to the debt-collection business be so nervous?
Well, Monique Sykes and the other plaintiffs claim that the defendants' business model is as follows:

· Buy debt with little documentation that the debt is accurate.

· File lawsuits claiming personal knowledge of the debt but using robo-signed affidavits instead.

· Deliberately fail to tell the "debtor" that the lawsuit is pending (a practice called "sewer service").

· Get a "default" judgment against the debtor when she fails to show up in court to defend herself.

· Enforce the judgment, including by freezing the debtor's bank account.

Grandma in California Uncovers Major Robo-notary Violations - (www.4closurefraud.org) Anita Carr is used to discovering fraudulent activities, even when she is not employed. In 2001 she discovered accounting irregularities at a Fortune 500 where she was a Director in Information Technology. This led to investor lawsuits against that company for accounting fraud and insider trading. At a prior employer she contacted the FBI and worked with them to ensure they investigated Medicare Fraud. The CFO of that company went to prison. Now, in fighting to determine title on her home, she has discovered something even more slimy and with much broader implications. In an attempt to validate a ‘squiggle’ type mark on a recorded document with the Alameda County Recorder’s office, Ms. Carr felt it imperative that she obtain a copy of the page from the notarial journal from the California notary who performed the notarization of the ‘Corporation Deed of Assignment’ related to her property. Ms. Carr, under California laws, is entitled to purchase a copy of the page in the notarial journal related to her property and so she wrote to the Orange County Recorder’s office and sent a check to cover the copy fees. Orange County is where the notary was registered. Within weeks she received a certified letter back from the Orange County recorder stating that they should have the notarial journal, but they did not have it. See, once a notary is no longer a notary in California, it is the law that they must turn in their notarial journal to the county recorder. Ms. Carr, in a lawsuit against her home loan originator Home123 Corporation, now in bankruptcy in Delaware, asked recently in informal discovery if they had the notarial journal. The answer came back ‘no’.

OTHER STORIES:

The job market: a lost decade - (www.marketwatch.com)

The End of New Deal Liberalism - (www.thenation.com)

The long-term fall in the housing price index - (www.themarketfinancial.com)

Massachusetts Ruling on Foreclosures Is a Warning to Banks - (www.nytimes.com)

Central banker urges China to cut US debt holdings - (www.reuters.com)

Sovereign Debt Unsafe, Default Concern Spreads to US, Japan - (www.bloomberg.com)

The Truth About Real Estate Prices - (www.sfgate.com)

Trend Toward Renting Continues, Even Among Those Who Could Easily Buy - (www.online.wsj.com)

Gold is a bubble - resist its charms - (www.money.cnn.com)

China property market limps into new year - (www.malaya.com.ph)