Politics from the Palouse to Puget Sound

Thursday, January 20, 2011


Bob Clark

Unemployment Not Improving
Reverse Mortgage Foreclosures
Foreclosures Continue in Washington State at High Rates
Municipal Bonds at Risk?

For the month of December things weren’t quiet as bad as the awful November numbers in Washington State except for the fact that some 36,730 Washingtonians dropped out of the workforce and gave up trying to find a job. The U3 number (% collecting unemployment benefits) came in at 324,270 which was less than November because of a math detail. That detail centers on the number of people LEAVING the workforce (above). The U6 number or the number of folks unemployed including those in the U3 category was 599,195.

Things were gloom in King County: 8.4% collecting benefits or 92,170 that means that 186,534 people remain unemployed in the state’s largest county. In Snohomish County the U3 & U6 numbers were 9.8% or 37,220 and 64,565 totals. In Pierce County it added up to 9.2% or 36,620 and 67,667 folks out of work.

On the national scene the numbers at the end of the week ending 1/15 were not very encouraging. (Editor’s note: don’t believe the fools who write for the newspapers or report on the local TV outlets who report only the SEASONABLY ADJUSTED NUMBERS. These numbers MEAN NOTHING!). Going to the unadjusted numbers at this website we find the following: 550,594 people filed for FIRST TIME unemployment benefits for this week. Remarkably we now have 9,607,423 people collecting some sort of unemployment benefits nationwide according the US Department of Labor. If you calculate the U6 number or the total number of unemployed folks it comes in at 14,880,092! That is a lot of people who are unemployed. Several million other Americans have resorted to finding jobs that they are over qualified for and are simply doing what they can to survive.

Reverse Mortgages in the thousands up for foreclosure

If you are over 62 don’t believe these ads folks and see an attorney before signing any reverse mortgage contract. Fact is that even though the FHA is trying to help out seniors, the unfortunate truth is that literally hundreds of thousands of seniors who took our reverse mortgages are about to lose their homes as lenders are now going after those seniors who have not followed their contracts. That contract requires them to pay for a certain level of home insurance and PAY their property taxes. In addition, many of the reverse mortgage contracts have a clause that gives the home to the lender, no matter how much equity exists in the home.

HUD has already given approval to lenders to proceed to foreclosures on seniors with reverse mortgages in default and that is NOT good news! On top of that many real estate investors are already monitoring the public record to zero in on these foreclosures in order to make money on this terrible situation. Apparently this problem is particularly bad in California, Florida and Arizona.

The latest foreclosure numbers for the State of Washington are not good. Here is the map and you can take a look on a county by county basis. 40,874 homes have been foreclosed over the past 12 months and some 4,029 recent foreclosures on the market.

The Obama Administration has been very skilled at lying and doing everything it can to hide the worst recession in the history of the USA. Changing the subject on the left leaning MS/NBC, CNBC, CNN, CBS, NBC and ABC doesn’t put food on the table or pay the car and mortgage bills!
Fast Breaking News: State's want to go bankrupt, Do you own muni's? You might want to selectively review them and get out of those that your broker or research indicates are risky and uninsured, such as almost any municipality in the State of California or the State itself. For those of you who scoff at this suggestion you might want to recall the default here in Washington State of the Washington Public Power Supply System (WHOOPS!) that cost bond holders 2.25 Billion Dollars (that with a B)!
Right now institutional investors have unloaded more than 14 Billion dollars in Muni’s and are running for cover. A link to today’s NY Times piece about States that want to declare bankruptcy is above. By the way Washington State’s budget deficit is now estimated to be much more than $6 Billion dollars, and I would like to know where they intend to come up with that money.

Thursday, January 06, 2011

Political News and Economics Magazine

Bob Clark
Governor Quagmire sits on her you know what and is doing nothing as it appears we have a MAJOR DISASTER with November’s unemployment numbers for the State of Washington. The numbers came in at levels signaling what I have been saying for 6 months: WE ARE IN A DOUBLE DIP RECESSION IN WASHINGTON STATE. To give you a picture of this disaster, 322,700 folks were collecting unemployment insurance in November in this state and that’s up almost 6,000 from October. Total unemployment in Washington was 602,846 or 17% in November up about 12,000 from the previous month. In the Tri-county area: King 9.1% or 134,270, Snohomish 38,110 or 10% and Pierce County 36,530 or 9% of the total workforces in those counties were collecting unemployment benefits. At the national level the US Department of Labor is reporting that 577,279 folks showed up to file for NEW unemployment benefits last week up more than 52,000 in the previous week (read the unadjusted numbers at this site). As I have said many times in the past SEASONABLY ADJUSTED NUMBERS ARE NOTHING LESS THAN A MAJOR LOAD OF MALE BOVINE EXCREMENT!

John Koster’s campaign has been questioning the vote counting in Whatcom County during the last election the grape vine tells me and that does not surprise me one bit. Larsen came in with 13,500 plus votes when the polls at the time showed him down against Koster county wide, yet the almost tie vote between the two swung the election to Larsen. Hmmm?

There was a major shakeup in the Snohomish County GOP with a whole new slate of leadership during the last central committee meeting. Activist Bill Cooper has taken over from Jim Kellett as county chair, Billye Brooks-Sebastiani takes over as Vice Chair, Olga Farnam takes over as State Committee Woman and Councilman Michael Plunkett assumes the State Committee Man position at the State central committee meetings.

A major battle is shaping up between conservative Bill Rennie and former radio talk show host Kirby Wilbur to take over the State Chairmanship of the Washington State Republican Party from the very unpopular Luke Esser (who is on his way out!). If I were to bet on the race I would say that right now it is to close to call with Kirby having a slight edge. The problem for Wilbur is that the Tea Party folks and most of the conservative wing of the state GOP are supporting Bill Rennie!

Foreclosures continue to pile up and threaten to destroy Washington State’s housing market. In the month of November, according to RealtyTrac, 4,067 homes were foreclosed on statewide. That brings year to date through November: 40,722 homes foreclosed on in the State of Washington. Here is the map for the month of November. I would like to clarify that a number of the 40,000 plus homes foreclosed on so far this year have been sold, but not enough to impact the continued decline in home values in Western Washington. To make matters worse many who signed up for ARM’s (Adjustable Rate Mortgages) a few years ago will find their mortgage payments double or triple during 2011 because a huge number of these ARM’s are expiring this year at the 3,5,6, and 10 year time frames all converging on this new year. That could mean that foreclosures could skyrocket in the first and second quarters of 2011.

The State of Washington’s tax revenue took a big hit this holiday season according to my sources at the State Legislature. Not with standing these bogus reports from the worst newspaper in the state: The Washington Post owned Everett Herald, the real number of this coming budget shortfall are already being talked about at the 5 Billion dollar plus level and that does not count unfunded liabilities for State Pension funds that could total as much as 20 Billion dollars according to my sources.
Breaking news: The US Department of Labor is saying that December's U3 number (the number of people collecting unemployment benefits) dropped to 9.4%. What they did not say was the fact that the reason for the drop is because a large number of people nationally left the work force because they have given up trying to find a job; that depresses the U3 number mathematically. Even though some 100,000 jobs were added in December, most of these jobs are TEMP/contractor jobs that ended at the end of the retail Christmas season. So if you see the "brain dead" media falling all over themselves saying this is good news, you may know the truth.

During the week ending 1/8/2011 770,413 people signed up for unemployment benefits for the first time up 191,686 from the previous week; an all time record! Meaning that all of those temp retail jobs for the holidays are over and the people are out of work. The total number of people collecting unemployment benefits as of 12/25/2010 was 9,193,838 folks, an all time record.