Tag Archive: bankruptcy

Trump: “Print money”

Here’s a couple of scary-ass Trump statements. First the set-up. Trump likes to talk about himself as a master negotiator. Does not like to mention that his father launched him rich; he’s a self-made winner. And to show off, he…
Read more

Gov. Christie acts by fiat in AC with disturbing results

Gov. Christie in order to get his way can act with broad bipartisan/popular support (Opioid Antidote and Overdose Prevention Act which was overwhelmingly approved by the legislature), obtain narrow bi-partisan support (half-baked Dreamers Act), arrange a pre-negotiated agreement with legislative leadership (tenure for our Chief Justice in exchange for a Republican Supreme court judge), remove line items costs from the legislature’s budget bill (he does so every year), veto bills (his vetoes have never been over-ridden), go to court (he failed to quash marriage equality and Fair Share housing claims, but succeeded in reducing the pension payment last year), and with the vast power of his office he can act by fiat.

In the case of Atlantic City he chose to act by fiat. In his press release he provided little reason for imposing an Emergency Manager and no clear vision regarding the anticipated outcome. Rather than offer more guidance and additional financial assistance, he turned the matter over to a hired manager. He can now continue his quest for the presidency paying little attention to AC problems. In his Executive Order he rehashed some of the already well-known financial issues. More importantly he hinted at approaches which deeply disturbed credit agencies and will bring concerns from unions, creditors, and bondholders with a potential negative state-wide impact.

Jon Corzine: “I simply do not know where the money is”

Jon Corzine, in prepared statement to the House Agriculture Committee:

I simply do not know where the money is, or why the accounts have not been reconciled to date.

Margaret Brennan on Bloomberg TV pointed out this morning that this is the first time in over 100 years that a former United States Senator has been subpoenaed to testify in Congress.

The former NJ governor apologizes for MF Global’s bankruptcy under his watch this morning and “to all those affected”. But he says he doesn’t know where the missing money went.

Corzine will say he was stunned when he was told Sunday, October 30, 2011, that MF Global could not account for hundreds of millions of dollars of client money. Corzine did not specify an amount, but investigators are trying to track $1.2 Billion, about double the amount first thought missing. It appears these were funds that were to be held in the company’s segregated accounts. Corzine now stands to be accused of co-mingling client money with firm money.

The FBI and other federal authorities are now also involved, as well as the House Financial Services Committee and the Senate Agriculture Committee. You can imagine the forensic accounting that will be required to reconcile this, and get answers on who did what with which accounts.

You can watch here at C-SPAN.

Housing and Foreclosure Problems Call Out for State and Local Solutions

When Sean McGowan signed a contract to buy a New Jersey home in November, he didn’t expect he’d still be living with his parents nearly a year later.

Former  Bergen County Improvement Authority Chairman Ronald O’Malley pleaded guilty Tuesday to mortgage fraud, falsely claiming in documents of home buyers that they were employees of BCIA. This is just another example of the staggering amount of greed, corruption, misrepresentation, and criminality that worked its way through the housing, mortgage, and foreclosure arenas. Unfortunately for New Jerseyans the impact is devastating to many and to our economy at large.

The Mortgage Bankers Association report showed that New Jersey’s combined foreclosure/seriously delinquent rate – 11.36 percent – is now the third highest in the country. New home sales nationally are at a 5 month low. Home sales and delinquent home owners will take another knock as Bank of America and others have now been allowed by the NJ court to go forward with thousands of pending and future foreclosures after being ordered in December to halt the process due to improperly verifying the accuracy of their documents.

 

Chrysler to close a quarter of their dealers, including 30 in New Jersey

The New York Times is reporting on Chrysler’s plan to close a quarter of their dealerships. It’s been widely reported that there are far too many auto dealers in the country, but this is still a very sad day.  My parents bought a Dodge Dart the day after I was born, and I grew up with Chryslers.

I looked that the list of proposed closings that was filed in bankruptcy court, and I count 23 New Jersey dealerships from all over the state:

  1. Butler

  2. Belle Mead

  3. Cape May Court House

  4. Peapack

  5. Orange

  6. Manahawkin

  7. Englewood

  8. Kearny

  9. Cherry Hill

  10. Hamilton Square

  11. Paramus

  12. Runnemede

  13. Marlton

  14. Parsippany

  15. Maple Shade

  16. Shrewsbury

  17. Woodbridge

  18. Neptune

  19. Rutherford

  20. Jersey City

  21. Wayne

  22. Rahway

  23. Wyckoff

Even more G.M. closings should be announced tomorrow.

Update: Oops: paid reporter 1, blogger 0.  nj.com says it is 30 dealerships.  Here are the seven I missed; this is especially embarrassing since I’m pretty sure Elmer is the closest dealership of any kind to me. :

  1. Berlin

  2. Hightstown

  3. Elmer

  4. Westwood

  5. Green Brook

  6. Tenafly

  7. Trenton

NJ Bank gets bailout funds

Anyone looking for a loan:

Central Jersey Bancorp will receive $11.3 million from the federal government’s program to fortify banks, according to documents filed with the U.S. Securities and Exchange Commission earlier this week.

The Ocean Township-based parent company of Central Jersey Bank said it planned to use the money to improve its “already strong capital position” and to lend to the community.

Central Jersey Bancorp has 13 locations in Monmouth and Ocean Counties.  The article talked about why some banks applied for bailout funds and others didn’t. Here’s how it works:

The agreement called for the Treasury Department to purchase 11,300 shares of Central Jersey Bancorp preferred stock. That means the government would be paid back before other shareholders in case of a bankruptcy.

The government also received the option to purchase up to 268,621 shares of common stock at $6.31 a share for up to 10 years.

The government will receive dividends of 5 percent a year for the first five years and 9 percent a year after that — subject to approval of the company’s board of directors.

I guess if the government is giving out money, it’s good for some NJ banks to get a piece of the pie. I’d still prefer some of the money come my way, but that request seems to be falling on deaf ears. Maybe I need to start a bank.

Menendez wants Credit Card reforms implemented ASAP

Last week, federal regulators adopted new regulations on credit cards to crack down on certain deceptive practices. The regulations include curbs on such practices as raising interest rates on current balances and allocating all payments to balances with the lowest interest rates if a cardholder has multiple balances.

The problem is, they don’t take effect until 2010 which isn’t soon enough for Senator Menendez. He reached out by letter to the CEO’s of :

“The health of the economy depends on the financial health of consumers — we cannot disconnect the nation’s GDP from its credit card holders’ APR,” wrote Senator Menendez. “Because of the great danger facing our economy, it is important that you institute the protections, as outlined in the recent regulations, as soon as possible.  In this current economic climate, many families are struggling to pay their bills on time and are making enormous sacrifices in order to keep up with their payments.  But without relief, between today and a year from next July, the current economy combined with the continuation of these harmful practices may make it impossible for these families to continue to pay their bills on time. The Federal Reserve proposed these regulations in draft form in May of this year, so they come as no surprise. Slowly running out the clock and taking no action until the very last minute would be detrimental to the entire economy and these honest, hardworking families.”

These regulations don’t address cardholders whose rates have already been raised and are trying to get out of debt but instead are only making interest payments. It’s good to see the Senator staying on top of this issue.  Credit card debt is a looming problem for the future that is only getting worse in these tough economic times.  He also has introduced legislation that goes even further than the new regulations to try and prevent the problem from getting worse. I certainly appreciate his efforts, but also have to wonder if he regrets his vote for the bankruptcy law changes back in 2005?

And how about if the credit card companies jack up rates before the new regulations take effect?  There still needs to be much more done.  Consumers need to be more responsible for the debt they are accumulating, but they shouldn’t have to worry about being taken further advantage of when they’re not looking.

Corzine calls for 3-6 month Foreclosure moratorium

I don’t now if he’ll get it, but speaking today before members of the mortgage lending industry, Governor Corzine talked about freezing mortgage foreclosures:

New Jersey Gov. Jon Corzine on Monday called for a three-to-six month forclosure time-out, while government officials set up systems to help homeowners modify their mortgages. “We need a bottom up approach to modifying mortgages one home at a time,” Corzine told a gathering in Washington organized by the Office of Thrift Supervision. “It’s going to be messy but you got to get on the ground level.” Corzine said government officials should consider an approach similar to one put forward by Federal Deposit Insurance Corp. chairwoman Sheila Bair that would use $24.4 billion of a federal government $700 billion Troubled Asset Relief Program to modify loans.

He talked about the 1st bailout passed by Congress and how it’s not having an impact on the mortgage situation:

“The TARP plan is a piece of cloth concealing the most real and fundamental problem” of foreclosures, Corzine said at the Office of Thrift Supervision’s National Housing Forum.

The first $350 billion of the TARP has primarily been used to inject capital into banks’ balance sheets, but has failed to significantly increase lending to consumers, Corzine said.

Corzine said a better use of the funds would be a broad, systematic plan to modify troubled home loans and said the second half of the TARP should go to stabilizing the mortgage markets.

He also said the U.S. government should announce a time out on foreclosures and should return to pre-2005 bankruptcy rules.

Many other states have requested a break on foreclosures, but it appears Corzine is proposing a blanket program to help take some of the strain off of the system, but not everyone thinks this is a good idea:

HousingWire’s sources have consistently said a foreclosure moratorium alone is not enough to prevent foreclosures. Dustin Hobbs, a spokesman for the California Mortgage Bankers Association, called a blanket moratorium “a Band-Aid approach” that fails to address the situations and circumstances of each borrower and find a suitable solution. “The only way to stop a foreclosure is to modify the loan, and that has to take place between the servicer and the borrower,” Hobbs said in an interview. “So, as good as it sounds, [a blanket moratorium] really doesn’t have any teeth to it, as far as actually changing a borrower’s situation.”

We’re already on pace to hit 50,000 foreclosures this year in NJ alone and parts of the state like Ocean County are seeing 30 foreclosures per day. As of November, NJ was unfortunately in the top ten across the country helping lead the way:

New Jersey was ranked eighth nationally with a foreclosure filing rate of one out of every 410 homes, a nearly 75 percent increase from October 2007.

We were ranked 10th in May, so the trend is definitely going in the wrong direction.   I’m not near smart enough to say I have the answers to this problem because it certainly wasn’t created overnight.  I don’t think taking any one action will be a quick fix.  This is going to take some time and pain, but we need serious discussions because the problem got worse as a result of people not seeing the risk before their eyes or not being willing to discuss what they saw in hopes it would just go away  Now that risk has turned into a catastrophe and continuing to wait only does more harm.  I know we need to find the right answers to the problem, but no answers or condemning the ideas that are suggested don’t advance a solution.  

If you’re going through the economic ups and downs struggling with your home mortgage, tell us what you are experiencing.

Chris Smith Denied Bankruptcy Protection to Troops

Josh Zeitz is the Democratic nominee in New Jersey’s Fourth Congressional district. He is running against Republican Chris Smith, who has backed George Bush’s ecnonomic and foreign policies and who serves as the chair of the anti-choice caucus in the House.

Chris Smith says that he wants to run on his record in Congress. Unfortunately, there are parts of his record that voters may find less than appealing, namely his vote to deny our troops bankruptcy protection.

More after the jump.