Ilyce Glink's Blog

Welcome to Ilyce Glink's blog! Here you'll find Ilyce's latest insights on personal finance advice, real estate advice and consumer issues. Come back often for timely and interesting posts on a wide variety of topics.

Today on the Clark Howard Show, September 5, 2008

Today on the Clark Howard Show we discussed the following:

* Delinquency and Foreclosure Rate Increase in Latest MBA Survey. The delinquency rate, which includes all loans that are at least one payment behind but doesn't include loans that are in the process of foreclosure, now stands at 6.41 percent, up 1.29 percent from a year ago. The survey reported that 2.75 percent of loans were in foreclosure an increase of 1.35 percent from a year ago.

These are the highest rates recorded since the survey started.

"The national foreclosure numbers continue to be driven by the hardest hit states continuing to get much worse. The increases in foreclosures in California and Florida overwhelmed improvements in states like Texas, Massachusetts, and Maryland," said Jay Brinkmann, MBA's Chief Economist and Senior Vice President for Research and Economics.

* The unemployment rate rose unexpectedly to 6.1 percent, a high for this cycle. The job loss was a worse-than-expected 84,000. Some economists think we're now certainly heading into a recession and expect to see job losses of 100,000 or more this fall. In any case, job losses will take some of the edge off of inflation -- at least for the moment. And, at least gas prices are falling.

Labels: Clark Howard, Economy, Foreclosure, unemployment, WSB

posted by Ilyce Glink at 2:01 PM 0 comments

Fewer Teens Work This Summer

When I was a teenager I babysat, pet-sat and worked at an Arby's. My favorite summer I was working at a local newspaper during the day and at Arby's at night. What a rush it was to go out and cover a tornado along with the rest of the newsroom staff. I was getting experience for my future career and making some summer spending money.

This summer's teenagers may be having a harder time finding a job than I did.

Fewer teenagers are working this summer. In June, employers hired 683,000 teens, far fewer than the 1.1 million who found jobs a year ago, according to outplacement firm Challenger, Gray and Christmas.

Since 1998, the number of teens hired in July has fallen 43 percent from June levels. The Labor Department predicts 389,000 will be hired this July, according to Challenger. That means 1.2 million additional teens will have been hired this summer, the smallest gain since 1958.

Apparently employers hired more teens than usual in March and April, according to Challenger. So perhaps they planned ahead.

Summer jobs not only give teens some income but they also teach responsibility, a work ethic and, in some cases, a chance to try out a future career.

Labels: Economy, employer, summer jobs

posted by Melanie G. Rogers at 4:28 PM 0 comments

More Americans File For Bankruptcy in First Half of 2008

Labels: Bankruptcy, creditors, debtors, Economy, Student Loans

posted by Melanie G. Rogers at 10:58 AM 0 comments

Looking for a Job? Try the U.S. Government

If you're thinking you may be laid off in the next few months and are longing for the security of a government job now may be a good time to start applying.

It can take months to go through the hiring process because of background checks and security clearance procedures. And your resume may have to follow a different format. Check out USAJobs.gov for openings.

Local, state and federal governments have added more than 50,000 jobs this year so far, according to Challenger, Gray and Christmas, a global outplacement consultancy firm. The firm announced that it believes the federal government has at least 100,000 current openings.

If you visit local and state government Web sites you'll likely find additional job opportunities.

One factor impacting the government's strong hiring drive is impending retirements. Fifty-eight percent of supervisory and 42 percent of non-supervisory federal workers will be eligible to retire by the end of fiscal year 2010, Challenger says, citing the Partnership for Public Service.

Other reasons to consider federal employment include pension opportunities and educational benefits. Harvard is offering to waive $41,000 of law school tuition for those who plan to work in the public sector, according to Challenger.

There are, of course, downsides to working in government, but for many it can lead to a fulfilling career.

You can also search for jobs here.

Labels: Economy, government, Jobs, layoffs

posted by Melanie G. Rogers at 1:08 PM 0 comments

Cash Rebates: Coming Your Way on Monday?

President Bush stood in the garden of the White House this morning and announced that the tax rebates would be on their way in your pocketbook by Monday. (You should have your cash on Monday, if you elected to receive your refund by direct deposit. Paper checks will take longer.)

But only those who have filed their tax returns, and meet the income levels, will be eligible for a tax rebate. Sadly, I will not be among those getting an electronic deposit into my bank account.

What are you going to do with your money? With consumers feeling so down in the dumps about the economy (it was the worst numbers for the consumer sentiment survey in more than 25 years), my sense is that most people will either use the cash to pay down debt (an excellent idea!) or buy basic necessities: food and gas.

While $800 to $1,600 isn't enough money to stave off foreclosure forever, it might be enough to keep your family going for another month or two. The President is hoping you'll spend it all, and more, on goods that will help jumpstart our economy.

Call me a skeptic, but I don't think we're going to see a huge bump in the economy from this.

Labels: Economy, money, rebate

posted by Ilyce Glink at 2:45 PM 0 comments

Today on the Ilyce Glink Show

We're talking about the economy today on the Ilyce Glink Show.

I find I'm confused why the stock market is at 13,895, nearly at its all-time high, while gold is also at an all-time high, and a barrel of oil is nearly at an all-time high (at $83 per barrel). Meanwhile, consumer confidence is holding up.

On the show this morning, we took a couple of calls from folks who say that on the ground, if you're making good money, life looks pretty good. The manager of a Lexus dealer called to say sales are up 23 percent this year! That's pretty good. Another caller, Mack, said he's in sales and he's having a good year, too.

(BTW: It's not sour grapes. I'm also having a good year financially.)

But some analysts say we're looking at at the wrong things. Harley Davidson, the motorcycle manufacturer, says sales are way down. Manufacturers of RVs aren't doing well either. These analysts say that looking at same store sales for Target, Costco, and WalMart is a red herring. No matter what, people will still buy stuff -- they'll just buy less. Look to discretionary purchases to see what's going on.

Is this true? Are you thinking of pushing off a big expenditure this year? Or, are you buying more because life, as we head into an election year, is good?

Feel free to post your comments here. Hope you can tune into the show.

Labels: Economy, Mortgage, WSB

posted by Ilyce Glink at 11:22 AM 0 comments

What do a housing economist, an investment analyst, and a home builder have in common?

What do a housing economist, an investment analyst, and a home builder all have in common?

They all agree the housing market is weaker than it seems. But they're divided on how bad it really is and what can be done to improve it.

Emile Haddad is the Chief Investment Officer of Lennar Home Builders. The company, which was founded in 1954 and is headquartered in Miami, has about $10 billion in sales (give or take a house). Emile says the company has written down optioned property, sold others, and is trying to sell homes. They are offering some discounts and incentives. He believes (wrongly, I think) that the media has played a role in making the housing downturn worse than it might have otherwise been.

"If you would all just write a story that we have hit the bottom, things would improve," he told a gathering of 150 top business editors and writers at the recent Society of American Business Editors and Writers conference in Anaheim. (He got a few chuckles.)

Amy Crews Cutts is the deputy chief economist for Freddie Mac. She says that we're in a place we've never been before with regard to the fallout from the subprime lending mess.

"The prime mortgage market will be absolutely boring," she told attendees at the same conference.

"We expect delinquencies in prime fixed-rate mortgages to be about level as economic growth sustains increases in employment and incomes. Adjustable rate mortgage resets are likely to raise prime ARM delinquency rates a bit, however resets don’t start in earnest until 2008," she added.

The problem is with the subprime market and payment option loans, which became very popular in 2003. These loans haven't really reset yet, but already there are repayment problems very early on.

"People can't afford these loans right now," she said. And because certain pieces of useful information aren't available, no one really knows who has these loans and what's going to happen when they do reset. "Clearly, foreclosures and delinquencies will rise."

"There are $1 trillion in ARMs that will reset in the next year, and those people are going to have trouble refinancing or keeping their homes," predicted Mark Keisel, executive vice president with PIMCO. "We've never before had mortgage debt grow faster than the GDP in 10 years. You can make a good case that the economy has been supported by mortgages."

Keisel is worried about the number of permits being pulled (down 28 percent from last year) which means fewer jobs, which means the economy will be slowing and job growth will be slowing as well.

"If you don't have a job, you're not buying a house," he said.

But Keisel has a job and isn't buying a house. "I probably won't buy for another year or two."

Labels: Economy, Freddie Mac, Mortgage, Subprime

posted by Ilyce Glink at 6:03 PM 0 comments

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