Bull Market officially over!! Year heading negative.

[Felya]

New heights of unemployment just released. Guessing the Dow gains 500?

[Rasulis]

It's the same concept as the old financial instruments bundling together of these rentals and selling them at high price the rent is the dividend sort of. Also there's very little or none of the admin or maintenance if you need help they just ignore you and kick you out.

Actually there is an easy way to proof that SF is too expensive for corporate rental homes. The article mentioned that Invitation Homes and American Homes 4 Rent control 60% of the market. I went to their website and checked if either has any properties in SF. American Homes 4 Rent has only 4 in the entire CA. None of them close to SF. Invitation Homes does have more homes in CA. Fifty seven in Northern California. None in SF or South Bay (i.e. Silicon Valley). None in Berkeley, Fremont, Oakland, etc. Their closest property to SF is in Richmond. On the other hand, in Atlanta alone, Invitation Homes has 311 homes.

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New heights of unemployment just released. Guessing the Dow gains 500?

It is actually down. Although, the decline likely has more to do with Senate wanting to delist Alibaba and Baidu than the unemployment number. Hell, Alibaba has a 600b market cap. If it is not a Chinese company, it would have been on the S&P 500.

On the good news side, FB is up again. My wife has gained over 60% of her investment in FB in March, and 92% in DocuSign. She has been doing I told you so quite a bit.

Mortgage forbearance is going to be the next issue for the Fed to tackle. Hardest hit states NY, NJ, FL and NV. FHA and VA loans have the highest rate of 30-, 60- and 90-day delinquency right now.

[Zan15]

Actually there is an easy way to proof that SF is too expensive for corporate rental homes. The article mentioned that Invitation Homes and American Homes 4 Rent control 60% of the market. I went to their website and checked if either has any properties in SF. American Homes 4 Rent has only 4 in the entire CA. None of them close to SF. Invitation Homes does have more homes in CA. Fifty seven in Northern California. None in SF or South Bay (i.e. Silicon Valley). None in Berkeley, Fremont, Oakland, etc. Their closest property to SF is in Richmond. On the other hand, in Atlanta alone, Invitation Homes has 311 homes.

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It is actually down. Although, the decline likely has more to do with Senate wanting to delist Alibaba and Baidu than the unemployment number. Hell, Alibaba has a 600b market cap. If it is not a Chinese company, it would have been on the S&P 500.

On the good news side, FB is up again. My wife has gained over 60% of her investment in FB in March, and 92% in DocuSign. She has been doing I told you so quite a bit.

Mortgage forbearance is going to be the next issue for the Fed to tackle. Hardest hit states NY, NJ, FL and NV. FHA and VA loans have the highest rate of 30-, 60- and 90-day delinquency right now.

Meh they will just tack it on to the end of the term under the agreement and move on.

right now with how fired up the market is in a lot of states thanks to record low rates I imagine a lot of area's can absorb a lot of foreclosures and short sales.
its the urban and real rural area's that are going to see issues which might be bad, but could end up being a wash.

[Draco-Onis]

Actually there is an easy way to proof that SF is too expensive for corporate rental homes. The article mentioned that Invitation Homes and American Homes 4 Rent control 60% of the market. I went to their website and checked if either has any properties in SF. American Homes 4 Rent has only 4 in the entire CA. None of them close to SF. Invitation Homes does have more homes in CA. Fifty seven in Northern California. None in SF or South Bay (i.e. Silicon Valley). None in Berkeley, Fremont, Oakland, etc. Their closest property to SF is in Richmond. On the other hand, in Atlanta alone, Invitation Homes has 311 homes.

Those assets are bundled together with other rental properties in not so good areas just like they did with MBS so you aren't just exposed to homes in one state. The main point is to sell these assets at a high price by making them look attractive profit on the rentals is not the primary goal.

[Rasulis]

ya I've been looking to downsize to a sub 1000sqft house in the country and these houses are dropping like flies and the realtor says there are multiple offers on every one.
She said she has not seen this kind of action in years that it defies logic.

It is interesting. The housing market in SF was slowing down. There was an article in Forbes from September 2019 about how the housing boom in SF is over. Then COVID-19 happened, and the market is smoking hot again. Homes are selling for 7 to 17% over asking and pending in 11 to 17 days from listing. Most with waived contingencies. Right now SF has the highest Redfin compete score in the US.

https://www.redfin.com/city/17151/CA...housing-market

Defies logic is an understatement.

The Mall of America hasn't paid its mortgage in 2 months

The biggest shopping center in the country, The Mall of America, has missed two months of payments on its $1.4 billion mortgage, a sign of just how much retail real estate owners are reeling during the coronavirus pandemic.

[Breccia]

The Mall of America hasn't paid its mortgage in 2 months

Wow. I had no idea the largest shopping center on the fucking planet had an American airline business-style fiscal model.

Honestly, we should have seen some actual progress on rent/mortgage relief by now. Maybe the Mall of America deserves it, maybe not, but there must be literally hundreds of thousands of bars, restaurants, and other small businesses that closed for the public good while still owing their landlord a check. The topic was kicked around a while, but doesn't seem to have gotten traction besides "get a loan".

[Zan15]

Wow. I had no idea the largest shopping center on the fucking planet had an American airline business-style fiscal model.

Honestly, we should have seen some actual progress on rent/mortgage relief by now. Maybe the Mall of America deserves it, maybe not, but there must be literally hundreds of thousands of bars, restaurants, and other small businesses that closed for the public good while still owing their landlord a check. The topic was kicked around a while, but doesn't seem to have gotten traction besides "get a loan".

Nah businesses got their mortgage help why would they help out actual taxpayers....duh

[Resurgo]

Coming from the standpoint of a small business owner;

I got lucky, my landlord let us defer our rent due for April/May out till Jan/Feb of next year. Only negative is that Jan/Feb is traditionally THE slowest months for us, so realistically, I'll have to find a way to pay it regardless long before that.

Much as I don't like the situation, I have to at least be thankful that I'm not with the last landlord. I have a few small business owner friends that are still with the last landlord and even if closed, the landlord demanded rent to be paid. So there's that.

[Rasulis]

Nah businesses got their mortgage help why would they help out actual taxpayers....duh

The scary part is what happened when the eviction moratorium end? How do renters pay the accumulated rent in one lump sum.

Also on the news.

California repays $1.4 billion federal loan for unemployment benefits

That was quick. Especially considering that because of the pandemic, they don't have to pay interest.

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Coming from the standpoint of a small business owner;

I got lucky, my landlord let us defer our rent due for April/May out till Jan/Feb of next year. Only negative is that Jan/Feb is traditionally THE slowest months for us, so realistically, I'll have to find a way to pay it regardless long before that.

Much as I don't like the situation, I have to at least be thankful that I'm not with the last landlord. I have a few small business owner friends that are still with the last landlord and even if closed, the landlord demanded rent to be paid. So there's that.

We own our own building. However we only used 4 suites and we rent the remaining suite to a tutoring company. Since schools closed, they also had to shut down. I told them that we would waive their March & April rent. They are still closed, but last week they mailed me an envelope with 4 checks in it. For their March, April, May and June lease payments. I was shocked.

[Resurgo]

We own our own building. However we only used 4 suites and we rent the remaining suite to a tutoring company. Since schools closed, they also had to shut down. I told them that we would waive their March & April rent. They are still closed, but last week they mailed me an envelope with 4 checks in it. For their March, April, May and June lease payments. I was shocked.

That's truly awesome on both fronts, for both you and your tenant!

[Zan15]

The scary part is what happened when the eviction moratorium end? How do renters pay the accumulated rent in one lump sum.

.

well they should have accumulated all those extra 600 dollar payments, but we know how well people save money.
Also they did not do a very good job at educating people that they will need to pay the rent down the road.
I know many people who think they don't have to pay it at all. A L O T

The scary part is what happened when the eviction moratorium end? How do renters pay the accumulated rent in one lump sum.

Also on the news.

California repays $1.4 billion federal loan for unemployment benefits

That was quick. Especially considering that because of the pandemic, they don't have to pay interest.

.

Most likely they got the quarterly tax payment influx from corporations and business and that was more than enough in benefits to pay it back. On top of their normal unemployment tax collections.

We own our own building. However we only used 4 suites and we rent the remaining suite to a tutoring company. Since schools closed, they also had to shut down. I told them that we would waive their March & April rent. They are still closed, but last week they mailed me an envelope with 4 checks in it. For their March, April, May and June lease payments. I was shocked.

I wonder if they got their PPP payment. They have to provide proof very quickly to show what they are spending the money on or they have to repay/interest it. so they probably just said fuck it and paid it all at once.

[Rasulis]

I wonder if they got their PPP payment. They have to provide proof very quickly to show what they are spending the money on or they have to repay/interest it. so they probably just said fuck it and paid it all at once.

Very likely. I have not had a chance to call the owner. Before she closed the office in March, she told me that she is going to try to shift the business online to keep the 30 - 40 part time tutors she had, mostly SDSU & UCSD students, employed. I would hate to lose her as a tenant. She has been a great tenant for the last 7 years.

BTW, the market cap of the FAAMG (Facebook, Amazon, Apple, Microsoft, Google) stocks now exceeds that of the entire euro zone equity market. How do you say FAAMG anyway?

[Breccia]

Hertz files for bankruptcy.

Unfortunately they forgot to fill up the tank before filing and had to pay an extra $25.60

[Zan15]

Very likely. I have not had a chance to call the owner. Before she closed the office in March, she told me that she is going to try to shift the business online to keep the 30 - 40 part time tutors she had, mostly SDSU & UCSD students, employed. I would hate to lose her as a tenant. She has been a great tenant for the last 7 years.

BTW, the market cap of the FAAMG (Facebook, Amazon, Apple, Microsoft, Google) stocks now exceeds that of the entire euro zone equity market. How do you say FAAMG anyway?

scary.

now that permanant layoffs are starting to accelerate (IBM latest), i might bail on the market again.
Also a few more companies filed for bankruptcy including Hertz. Though they were debt ridden before this

[Breccia]

Memorial Day weekend deals latest economic blow to travel industry

I don't know if there's a "Black Friday" for the travel industry. If I had to guess, I'd say July 4. But yeah, the reduction here's going to hurt like hell -- specifically, a loss of $8 billion compared to last year.

The three-day holiday weekend, which typically kicks off the summer tourist season, is expected to bring in just a third of last year’s revenue, according to data from the U.S. Travel Association.

Those dire figures and the near-collapse of the industry itself are prompting more calls for government aid.

“Our industry is still in what we would call rescue mode. We need help significantly,” said Chip Rogers, CEO of the American Hotel and Lodging Association (AHLA).

The plunge in revenue has some trade executives wondering if the summer travel season can even be salvaged. Leaders are now pinning their hopes on congressional action and more reopening at the state level so that the July 4th weekend can help make up for lost time and money.

“Time is of the essence. We know that now the next package is not looking imminent in the short term [but] it’s critical to get something done” before Independence Day, said Tori Emerson Barnes, executive vice president of public affairs and policy at the U.S. Travel Association.

Congress, however, isn’t expected to pass additional legislation anytime soon.

Senate Majority Leader Mitch McConnell (R-Ky.) has signaled bla bla bla "No to Everything" crawled back into his shell

We already saw serious spread of COVID-19 from Spring Break beaches. Hopefully, two months later, people are on better behavior and the beachfront businesses are better aware of the risks. Because near as I can tell, McConnell has demanded the next bill have lawsuit protection, meaning that the lawsuit protection doesn't exist yet. And even if lawsuit protection is enabled, once your name is on the "I stayed at this hotel and I got COVID-19" list, it doesn't end well from there. You don't have to be sued to lose business if people know, or even suspect, you can't protect your own customers.

[Rasulis]

scary.

now that permanant layoffs are starting to accelerate (IBM latest), i might bail on the market again.
Also a few more companies filed for bankruptcy including Hertz. Though they were debt ridden before this

I have not been following IBM. It is a bit strange that they are laying off people when the other tech giants are on a hiring spree. When they gave that DOS contract to Gates, they probably never dreamed that the day would come when Microsoft, not only would become a competitor, but would eclipsed them.

BTW, it appears that the news that tech has abandoned CA is overblown or wishful thinking by Texas governors. Here is an incomplete short list of CA tech companies that dominate the COVID-19 economy - Apple, Google, FB, Activision Blizzard, Digital Reality, DocuSign, EBay, PayPal, EA, Everbridge, Netflix, NortonLifelock, Nvidia, Peloton, ServiceNow, Oracle, Slack, Virtu, Zoom, Intuit, Intel, Qualcomm, AMD, etc. When it comes to biotech and telemedicine companies which are also doing well in this economy, the only competition for CA is MA.

[Breccia]

NBC News pays tribute to those we've lost in the last two weeks alone, such as Hertz and JCPenny. We know most of those names. But they add to the bad news. (Here's a more convenient list)

But even before May, there were signs of trouble for the brick-and-mortar commerce world this year.

Back in mid-February, Pier One entered Chapter 11, a move that affected roughly 970 locations and 18,000 employees scattered around the United States with some in Canada. Art Van Furniture, said it would be shuttering on March 8, affecting 3,000 employees and 169 locations around the Midwest. And on March 11, Modell’s, which claimed to be the oldest sporting goods store in America said it was entering Chapter 11, closing the doors of about 140 locations with 3,600 employees on the East Coast.

And even beyond retail, there were signs of trouble elsewhere in the economy. In January, Bar Louie, the trendy upscale chain of bar/bistros, announced it would begin a bankruptcy restructuring hitting 90 locations and 1,500 employees.

In other words, even before the COVID-19 pandemic hit the United States, there were signs that 2020 might not be shaping up to be a great year for merchants with real-world physical locations. Part of that may have been economic exhaustion. The post-Great Recession expansion had been unfolding for more than 10 years (since 2009) when 2020 arrived. Some retrenching may have been inevitable.

Now, finding older predictions is not all that hard.

U.S. Bankruptcies Rise in 2019 After Eight Years of Decline (lead by Alabama)

Farm bankruptcies jumped 20% in 2019, even with billions in aid from U.S.

The unemployment rate of the United States has been steadily decreasing since the 2008 financial crisis, but by 2030, it is projected that the unemployment rate will increase to 4.5 percent. This would be an increase from 3.7 percent in 2019.

Weekly jobless claims fall but number of unemployed surged to a more than 1 1/2-year high

2020 Annual Retail Sales Expected to Fall to 13.48 Million

This article, titled Economists are slashing 4th-quarter GDP forecasts, has this quote:

Numerous banks cut their 2020 GDP estimates in mid-December after Boeing announced it would halt 737 Max production in January. The bestselling model was grounded worldwide after two crashes, in late 2018 and early 2019, killed 346 people.

The pause in inventory buildup will drag on GDP in the first quarter of the new year, JPMorgan said December 17, adding that it could cut roughly 0.5 percentage points from the benchmark figure.

Real Wages Decline in December, Barely Up From Year Ago

All of these articles have one thing in common: they were published in January. Well before any outbreak.

But with that in mind, I can't help but notice the Q1 2020 GDP revision hasn't come out yet, it's due out in a few days. Last we heard, it was negative 4.6%. We're seeing 40% loss predictions from everyone from banks to investors to the CBO to even the Atlanta Fed. Bankruptcies are on the rise, and that includes shale companies and yet more farms.

There's no good news here. But there wasn't going to be much in the first place. The roof was already leaking before the tornado.

[Rasulis]

The real nightmare would be when all the eviction moratoriums end.

[Thepersona]

The real nightmare would be when all the eviction moratoriums end.

Ok, they evict 100s of thousands of tenants. And then what? who would have the money to rent ATM? i see another housing market crash in the following 4-5 months

[Breccia]

The real nightmare would be when all the eviction moratoriums end.

Ok, they evict 100s of thousands of tenants. And then what? who would have the money to rent ATM? i see another housing market crash in the following 4-5 months

It might not be so simple.

Landlords lining up to evict hundreds of Tampa Bay tenants once moratorium expires

The rush to protect tenants from homelessness has resulted in a confusing patchwork of local, state and federal protections, most of which have little or no legal precedent.

In Hillsborough County, for example, an administrative order allows the Sheriff’s Office not to enforce a writ of possession, the final step of an eviction. But no such protection exists in neighboring Pinellas County, where about 190 evictions have been filed since DeSantis’ order.

Then there is a statewide order issued by Florida Supreme Court Chief Justice Charles Canady. It suspends the requirement to issue writs of possession to county sheriffs through May 29, though in practice it stays in effect as long as DeSantis’ order does.

Muddying the waters further is the federal CARES Act, which prohibits evictions in residential properties that receive government subsidies, such as Section 8, or that have federally backed mortgages — that is, mortgages owned or secured by government entities such as Fannie Mae and Freddie Mac. The CARES Act’s eviction suspension expires July 25.

And here's one from Texas:

Renters prepare for tough choices as eviction proceedings resume in Texas

Unemployment has disproportionately affected renters since the crisis began. Advocates fear displacement and an increase in homelessness.

Housing advocates are warning that with more than 1.9 million Texans filing for unemployment relief in the last two months, eliminating eviction protections for renters could soon lead to an increase in homelessness.

“This puts a lot of renters in an even more difficult place than they were before, having to make difficult decisions between getting food on their table or a roof over their heads,” said Heather K. Way, director of the Entrepreneurship and Community Development Clinic at the University of Texas Law School. “There will be many people losing their housing, as they have fallen through the cracks of the different and limited eviction protections available.”

The number of people who could be impacted by lifting the eviction moratoriums is not known because there's no data available yet to understand who is covered by the patchwork of regulations existing in the state. But Way said affordable housing was already scarce in Texas and that renters have been disproportionately affected by the economic crisis created by COVID-19.

“There’s easily thousands of households,” Way said. “There’s people suffering since March, but there’s also new people getting laid off.”

Officials at the Texas Apartment Association, whose 12,000 members include around 7,500 property owners and operators, said that landlords are also having to deal with the pressures caused by the crisis.

“For our members, evictions are always going to be a measure of last resource, and we are recommending them to work with residents that have been impacted by COVID-19. If a resident is having problems paying rent, we hope they reach out to landlords to work with them,” said David Mintz, vice president of government affairs with the Texas Apartment Association. “Property owners need to keep running properties, pay employees, vendors, mortgages, utilities and all the other expenses. There really has to be this balance that we need to meet.”

(Keep an eye on Houston. The moratorium was just lifted and the Texas SCOTUS says evictions can continue)

'Mass evictions' feared in Iowa when governor's order giving renters relief for nonpayment expires

It varies drastically by state.

Oklahoma County deputies about to start serving eviction notices by law amid pandemic

versus

New York State Stays Evictions and Foreclosures Due to the COVID-19 Pandemic

It's not purely by party, either. Indiana just extended. California's eyeing the door (at least in SF they are). It's a whole thing. Simply put, however, there's no clear "what happens after?" easy answer. However, best of my knowledge, there's no federal help specifically for paying the rent. And McConnell has been fighting the "all-purpose" money for some time.

For more, but outdated, information, this May 1 ABC News article talks about the predicted 'mass evictions', as well as some pre-existing conditions (more people have been renting recently).

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More bad news for Phase One. China literally used the term "Cold War" referring to Trump and Pompeo's actions.

It doesn't even matter if Trump and Pompeo are right anymore. Trump wanted a trade deal, and every action he's taking is damaging those hopes.