Of Editorials I wish I had read in the The Miami Herald, first ... by gimleteye

In order to fund pension liabilities and deliver money back to the McClatchy debt fund, the Miami Herald has cut staff to the bone. One of the places the resultant deficit shows up is the editorial page. Herald readers have no idea that newspaper subscribers in other parts of the state have access to a wider range of views and a deeper bench of editorial writers than in Miami. The St. Pete Times, the Palm Beach Post, and the Naples Daily News; to name a few.

I don't write this, to knock the few editorial writers at the Herald who pull their weight or even the past writers who do a star turn from time to time. There is another and less charitable explanation than economic necessity has put the paper on an informational diet: that Herald readers don't want complexity. (It really does say something when the newspaper's best editorial writer is its cartoonist.)

Miami's only daily newspaper is USA Today local lite. Here is an example of a tough, hard-hitting editorial that readers ought to have read in the Miami Herald first. What's so great about this editorial, that one wouldn't find in the Miami Herald? First of all, it is about a topic that the Herald scarcely touches: wetlands mitigation banking, one of the great frauds of the Growth Machine in Florida. Secondly, when the investigative report on which the editorial is based was first published, the reporter Craig Pittman noted the connection between the operator, a firm connected to Gov. Rick Scott's DEP chief, and suppression of an environmental regulator. Moreover, the firm was connected, through ownership, to the Carlyle Group. Anyone's antennas would stick up at mention of the Carlisle Group's involvement in a piddling $15 million project in Jacksonville.

So bless the St. Pete Times editorial writer for pointing out: "The Highlands Ranch Mitigation Bank is a joint venture between the Carlyle Group and a Jacksonville company. The Carlyle Group, which has in the past included people like former President George H.W. Bush and former Secretary of State James Baker on its board of directors, only has a lousy stinking $159 billion in assets, with investments around the globe." Linking up the pieces is something Herald editorial writers simply don't do very well.

Because local newspapers don't pick up the slack, the public is whip-sawed by demagogues like Rush Limbaugh (cf., post below "Stop Rush"). Maybe the Herald is worried about antagonizing its own advertisers. Click 'read more' for the St. Pete Times editorial.

Back scratchers at mitigation bank

By Daniel Ruth, Times Columnist
In Print: Tuesday, August 7, 2012

There's simply no justice sometimes. This wonderful company, the Highlands Ranch Mitigation Bank, is just trying to make a buck by protecting Florida's wetlands so that other developers can destroy them, only to be stymied by paper-pushing, tree-hugging bureaucrats all lathered up over stuff like following the law.

It's just not fair.

As reported by the Tampa Bay Times' Craig Pittman, all Highlands Ranch wants is a permit to convert 1,575 acres of a pine plantation in Clay County into a wetlands mitigation bank. Is this too much to ask?

After all, throughout Florida history, wetlands have been the bane of developers. You can't build something on a swamp. But because of those pesky little issues like recharging the aquifer, the source of Floridians' drinking water, the state decided maybe it should try to save some and created a program for folks like Highlands Ranch. Landowners make promises to maintain or restore wetlands, creating wetlands mitigation credits, which can then be sold for as much as $100,000 per credit to developers who want to destroy wetlands elsewhere...

Come on, Miami Herald! ... by gimleteye

There are points of view that the Miami Herald editorial board needs to take the time to express, that are getting lost in the shuffle of McClatchy towards some sort of resolution. We do our best here, for free. The strange part of it is: we hear that the Herald itself is very profitable. So why isn't the Herald putting the money into reporters, staff, and intensity on issues that affect not just north Florida where the St. Pete Times excels, but South Florida?

Click 'read more', for the St. Pete Times.

In its Sam Zell story, what The Miami Herald missed ... by gimleteye

The Miami Herald reported the Sam Zell story in a way that gave cover to Jorge Perez, surely the last man in Miami who ought to be papered over in a discussion about what is needed to revive the economy. Mr. Perez might not have been the salesman-in-chief of the housing boom, but he surely deserves to take a back seat now that the housing bust enveloped the economy. Zell gets the spotlight because he is a billionaire investor who slid out from under the real estate crash. His critique of Miami runs in tandem with Eyeonmiami: "Miami's economic future depends on whether it can create a well-educated, highly skilled, talented workforce." Yes, but.

Regarding the Herald's trumpeting messengers who might or not deserve to be shot: if the powers that be have created such a mess of a second tier American city, do they deserve any credibility at all? Whether touting the Miami Marlins Stadium, the PAC, the Arts Museum, or Mr. Zell, the Herald can't seem to find its balance. And what about Mr. Zell and the Tribune Co? One imagines Herald reporters reading the puff piece in their newspaper about Zell then barfing in their wastebaskets.

On Big Sugar: Why The Palm Beach Post, not The Miami Herald? by gimleteye

Hand it to the Palm Beach Post, sitting up there in the middle of Big Sugar country. They have no hesitation blasting the Florida legislature and its patrons from the sugar industry, regularly. Given that the billionaire Fanjuls throw their influence around in Miami and Miami-Dade County the same way they do in Palm Beach, why is it lowly blogs like EOM-- but not the Herald-- are willing to take strong positions that bring good things to life and not addicted to sugar?

Huffington Post Takes on The Miami Herald ... by gimleteye

It is inevitable that horizontal national news/blogs would send roots down to local audiences. Now we have a test case: the Miami edition of the Huffington Post.

So far Huffington hasn't put much money into the site, but its vertical ambition is intriguing. I doubt contributors are paid, but the local HuffPost formula could be an evolutionary jump. Seeding the site with national HuffPost stories (coded to Miami and Florida interest) and mashing them up with local derived stories with the HuffPost feel is an interesting concept.

I have no insight how the clash for viewers/audiences will work out for advertisers. (Jeesh, we have been doing this for years nourished only by true grit.) The Miami New Times, purely local, has its own sweet spot; the New Times jumps in with daily additions to its website, augmenting the weekly paper.

I doubt the HuffPost Miami is a threat to the New Times franchise. The Herald, on the other hand, is another matter. The paper is a jumble and sometimes seems to be published with a staff of three. It has given up on reporting local news with any kind of depth or consistency.

With a little investment, Huffington might find the keys to the web-based lock on profit from news. Blogs like ours will just have to sell to the highest bidder. And we'll post a link to the HuffPost site when it cross links with ours.

Let Us Now Praise Famous Parking Lots ... by gimleteye

News arrives in the Herald of the latest but not last blow to the $190 million deal-- struck by Greenberg Traurig and its Herald executive pals-- at the height of the building boom to convert 10 acres of Herald real estate to condos/retail/parking. The busted deal to create a Times Square, squarely in the middle of nothing, stands for the hubris of the boom in more ways than one, but the one we have focused on at Eyeonmiami is how the parking lot deal distorted the editorial view from One Herald Square-- stripping from the city's only daily newspaper critical analysis of the housing asset bubble that might have tempered the boundless enthusiasms related to the boom that took root first, then rotted.

Credit the Herald for reporting its own embarrassing embrace, if not detailing who got paid how much and how many millions in compensation were distributed long ago to Herald executives based, in part, on benefits to shareholders of the imagined deal. That would make a far more interesting story than a collapsed promise. But the parking lot is also emblematic of a city that can't plan its infrastructure to save its life, and, a newspaper that can't report it because of internal conflicts.

Herald founders were right to place the newspaper's view and operations at the intersection of the main route from Miami to Miami Beach. At the time, Miami was a small city. Despite its ambitions, Miami in the mid 20th century was small minded and mean, with its share of bigots and racism. All that traffic flowed past the Herald, across the causeway to island homes; from which one could hop on a boat at lunchtime and return with a locker full of fish for dinner a few hours later. That Miami-- the Miami of John and James Knight and the rod and reel club-- is gone and vanished. All that remains are a few fish docks with cleaning tables whose purpose is all but forgotten.

The way the city filled in leaves another kind of view; a city cut off from itself. The tragedy of privatizing waterfront in downtown Miami cannot be rectified without tearing down Bayside Marketplace and refocusing the attention back to the bay. In the meantime, civic structures, a private arena, and condos have filled in; from the Miami Heat to the Performing Arsht Center and the empty Herald parking lot. Nothing on this stretch of Biscayne Boulevard makes sense. It is an unworkable landscape created with glad-handing, and former bubbly and coke in the VIP rooms of condo openings. The Herald sits, resolute, in the midst of this history and this disconnected landscape.

On evenings when the Performing Arsht Center is scheduled at the same time as the Miami Heat and the circus, the pathetic single lane Biscayne Boulevard exit from 395 causes traffic to backfill all the way to 95. I know it is easier to get downtown, if you live downtown or mid-town or uptown; but what the city fathers allowed to be built (and now we will have a science museum and art museum, in the same traffic vector) is an infrastructure mess no tout or public relations megaphone can explain away.

I know: Miami is a fantastic place to live and the winter weather makes the rest of the nation yearn to be in our shoes. This is the finest city in the world. It is the best place on earth. The water is clean and the Everglades are saved. And the Miami Herald also has a parking lot to sell you.

Miami Herald Ombudsman roars: woaaa! stop the presses! by gimleteye

I can't resist an ill-informed comment on the Sunday editorial page of The Miami Herald. "When a partner goes too far, who is responsible" asks the Herald ombudsman, Edward Schumacher-Matos, of the Herald program that is feeling its way to online alliances with non-traditional suppliers of news, "as an innovative way to aggregate community information across South Florida into one site for readers and advertisers." So far, so good.

But now comes the rub; "Herald editors are finding themselves entangled with the owners of (some) whose ethics are challenged by readers." Hmmm. I'd never thought of that possibility: except as it might be applied to the ethics of Miami Herald editors and executives.

The Herald's example: Community Newspapers, a free advertiser supported give-away in twelve breath-taking editions owned by Michael Miller. Apparently readers have complained to the Herald, of the Herald's deigning to affiliate with such low merchandise. To wit, Michael Miller is a self-aggrandizing businessman whose primary interest is to increase the value of his property in South Miami-- where a density increase would be good for his net worth. A reader writes: "His goal is simply, to change the zoning governing height and density of commercial property that he owns on 62nd Avenue in South Miami." The ethicist Herald concludes, "... at least in his South Miami paper, (Miller) goes too far. The Herald should reign him in, or cut him off." En garde!

Wow. The Miami Herald dares not affiliate the fantastic power of its online readership with lesser organs that sully the good name of newspapers! Dilute the truth that readers expect? Never!

But wait. Wasn't there something about Miami Herald property adjacent to One Herald Square, figuring into the profits of Miami Herald shareholders and executives compensated on ROI and other deliverables that don't come in plastic wrap. Something about a parking lot and the plan by Greenberg Traurig attorney/developer Pedro Martin; was it a bankable promise for $190 million to turn that parking lot into a condo tower. And wasn't there something about the deal collapsing in the muck of the financial crash, skittering away on McClatchy's awful balance sheet. And what about the top guns at Greenberg Traurig playing footsie with Herald executives-- chasing Hodding Carter off to the sunset and installing Alberto Ibarguen at the Knight Foundation-- and what about the Herald's failure to report out the condo boom for what it was: rooted in fraudulent finance and speculation that contributed to keeping the greater Miami public in the dark about all the other excess, including the excess of executive compensation tied to profits based on... well, speculation? Yes the pot gets to call the kettle, black. Or is that politically incorrect to say so, or, does anyone remember anything anymore?

Mr. Ombudsman, I'm not a great fan of Community Newspapers. It is a trifle with the bite of a blind fourteen year old retriever. The scores it settles are not even the scores that count. But honestly, to see the debate on online affiliation carried out on the wings of the Herald's own sins of omission and taking to task a newspaperman for shamelessly shilling his own property value: well, sir, that is too much! Consider yourself served, by Eyeonmiami!


Posted on Mon, Jan. 04, 2010
Miami Herald land deal is extended

Miami Herald Staff Report

McClatchy Co., the parent of The Miami Herald Media Co., said it has extended the deadline of the contract to sell property surrounding The Miami Herald's bayfront property to Jan. 19. The contract to sell 10 acres of parking lots to developer Mark Siffin was set to expire Dec. 31.

In exchange for more time, the contract termination fee has been raised to $7 million from $6 million if the buyer doesn't close the transaction. The buyer also may pay McClatchy an additional nonrefundable deposit of $6 million by Jan. 19 to extend the agreement to Jan. 31, 2011.

The deal was first reached in March 2005 at the peak of South Florida's real estate boom. At the time, Knight Ridder, the Herald's previous owner, agreed to sell the surface parking lots and the Boulevard Shops on Biscayne Boulevard to a group led by Miami developer Pedro Martin for $190 million.

Martin's group later agreed to flip most of the 10 acres to Siffin for at least $230 million, though the price to McClatchy would remain at $190 million. McClatchy acquired Knight Ridder in June 2006.

Siffin has approval from Miami officials to build a big-box shopping center called City Square on the parking lot site and also planned to build a parking garagefor the nearby performing arts center.

McClatchy, which has been hit hard by the bleak advertising environment, planned to use the proceeds of the sale to reduce debt.

In 2008, when the contract was set to expire, McClatchy agreed to give the developer more time to complete the deal rather than to put the real estate up for sale again in a depressed market.


Read more: http://www.miamiherald.com/2010/01/04/v-print/1408640/miami-herald-land-deal-is-extended.html#ixzz0oqErrBci

Apocryphal story of a Bad Decade: The Miami Herald parking lot ... by gimleteye

A friend of mine went to a New Year's Eve Party at a non-denominational church. There, attendees wrote on a slip of paper what they would like to leave behind from the old decade and set them on fire in a pile. So long. Sayonara.

I guess executive management of McClatchy, that purchased The Miami Herald at the top of the market, would like to do that with its $4.5 billion purchase of Knight Ridder in 2006. What were they thinking? Newspaper readers know one thing for sure: the real estate boom was pixie dust that made executives in all industries related to the Growth Machine, rich.

That was the tenor of the decade, encapsulated in the deal to turn a 10 acre parcel, the company parking lot, outside the Herald headquarters into $190 million. The deal between the Herald and a group of investors lead by Pedro Martin was consummated in March, 2005 and it was supposed to close by Dec 31, as reported in the Herald in one of the final stories of the decade. At the time, it was just one more upward tick of the frenzy that had obscured the relationship of critical thinking by the mainstream press about the sad transformation of the Florida landscape by speculators into a market bubble. It also accounts for the poor coverage leading up to decisions to spend $500 million on the Carniverous Performing Arts Center and the planning for museums in the last open space in the downtown waterfront: Bicentennial Park. With so much money tied up in a parking lot, whose future value meant nearly $200 million to Herald owners, what chance did the public interest have?

The Miami Herald could not provide critical coverage of the most important story of the decade when the compensation of its top executives was tied to "everyone is doing it". It wasn't just downtown. It was in the farmland of South Dade and West Dade where development at any cost ran rampant. What is good for the goose, is good for the gander. In other words, the Herald couldn't write critically of growth in the suburbs so long as its profits and wealth creation was tied to real estate downtown. The Herald parking lot will stay an empty space for a long time. The deal looks to be busted. In my opinion, McClatchy will get its $190 million before newspaper readers get a mea culpa from past and present executives of the Miami Herald for failing to report the biggest story of the decade as it was taking place, dragging the US economy down with it.

Cold Front! by gimleteye

When I came out of the movie theater last night ("Where the Wild Things Are", great!), you could feel a swirling wind trying to push out a whole summer of heat and humidity at once. What a relief to turn off the air conditioning (and deny FPL a few dollars of revenue). The first cold front of the season in Miami arrives like a blessing. It put me in such a good mood that I was nearly willing to find grace in The Miami Herald ...

At the park the dogs were happy. Chasing and barking and excited in the new day. The front page of the Herald has three notable stories. The first, from McClatchy, is about the corruption of the nation's largest bond rating agency, Moody's that bears significant responsibility for the miscalculation of risk that lead to the unfolding economic catastrophe; the worst since the Great Depression. The story adds little to the public record. Everyone was doing it. A day late, a few trillion dollars short. The second story on the front page describes the unfolding consequences of this catastrophe in South Florida: the rising number of home foreclosures and the next tsunami on the horizon. It is a good story, and supports what I've believed for a long time: that this Great Recession is not over by a long shot. We could be heading into a decade or more of economic malaise in South Florida; worth considering in light of the lost decades in Japan as a result of its own property market bubble and bust.

I've written before that The Miami Herald largely missed the biggest story of the 21st century as it unfolded. Too bad. On the other hand, the third story is about the cash hoard held by Miami-Dade county commissioners, individually, and it shows the kind of forensic reporting that only a newspaper with paid journalists can bring to bear on the grief and poor judgement that passes for governance. Although there are only a few reporters on the local beat-- due to the paper's weakened finances, it is good to see the paper striving to catch up to the awful holes in coverage caused by the housing boom when the Herald executive office feverishly justified saying nothing bad about the Growth Machine itself; mainly because their salaries and compensation were so closely tied to profits based on advertising revenue from the Growth Machine. In the sense that the papers are not making money, it is perhaps easier for newspaper executives to pick up the rusty tools of their profession.

I appreciated the end of the report, giving the penultimate word to Commissioner Pepe Diaz, pontificating on "rainy day" funds and an independent observer the last word; noting that "rainy day" funds belong in general revenue not the pockets of county commissioners who are inclined to use their individual stashes to reinforce their permanent incumbencies.

This thinking-- "everyone is doing it"-- connects the county commissioners, corrupt ratings by bond agencies packaging financial derivatives (yes I do know what they are), and homeowners who bought more mortgage than they could afford in good times and now are drowning. The only piece that the Herald continues to fail to report: the role of the homebuilders and the engineering / lobbying cartel who still influence the Herald's executive suites. They were "doing it" too: the Greenberg Traurigs helping out the R. Allen Stanfords, spreading the miscalculation of risk as gospel of "free market" capitalism.

Too bad the Herald won't get into it, for readers. They might start with the travesty of Homestead; the bankers, and insider cronyism, and ethnic/racial politics that obscured so much fraud and corruption. It is just a suggestion, maybe the next cold front will blow it onto the front pages of The Miami Herald.

Sea level rise in Miami: free hip waders for all, including disbelievers: fruitless spending on mitigation has started ... by gimleteye

Yesterday's big question was the county budget hearing and how $400 million would be slashed from the budget by county commissioners who are insulated behind the impermeable barriers of permanent incumbency. But the bigger issue in the grand scheme of things was rising through city sewers only a few blocks away where sea water from very high tides was pushing onto Miami city streets. Exactly a year ago, Eyeonmiami featured, "Sea level rise in Miami, here now". The post included dramatic photos of flooding in downtown Miami near some of the city's new and empty condo buildings. (click 'read more', for more fotos)

The City of Miami has been quiet on the subject. It doesn't mean that city engineers haven't responded. They have. Thanks to one of our readers, we have photos taken from the same location as last year's flood tide. The photos show a flood control work in process: elevated roads surrounding the condo. Someone (taxpayers, maybe?) has already spent lots of money to fight off property owners. I assume the project also includes raised sewer drains that were too low to drain the high tides seen in last year's photos. I wonder who is making decisions to elevate roadways that are getting flooded by these tides. Who gets flood control from the impacts of global warming in Miami and who doesn't?




The Herald's front page story today attributes the extra high tides to the new moon tide. The Herald doesn't take up the question of science of unusual sea level rise that may be related to global warming. Strange. It is in the news, too, but just not in the Herald. This summer, scientists observed sea level rises up to two feet higher than expected on the East Coast. NOAA, according to a report published by the Environmental News Network, released a report on causes, including a slowing Gulf Stream. Read about the impacts of climate change from a slowing Gulf Stream, here.

In an informal poll of scientists and observers, my contacts are also seeing much higher, high tides-- and not just on the moon cycle. (Like the housing market crash that Herald editors failed to identify before it happened, I'm guessing the editors who are left will be paddling to work in canoes before they pick up the question if these super high tides are connected to a slowing Gulf Stream caused by climate change. And where are those hurricanes, anyhow?) Will Miami be elevating roadways throughout downtown, foot by foot of sea level rise? How much more money will taxpayers be throwing at "beach replenishment" of sand washed away by tides?

"September 15, 2009 05:56 AM
Sea Levels Rose as Much as Two Feet This Summer in U.S. East

Sea levels rose as much as 2 feet (60 centimeters) higher than predicted this summer along the U.S. East Coast, surprising scientists who forecast such periodic fluctuations. The immediate cause of the unexpected rise has now been solved, U.S. officials say in a new report (hint: it wasn't global warming). But the underlying reason remains a mystery.

A new report from NOAA identified the two major factors behind the high sea levels-a weakened Gulf Stream and steady winds from the northeastern Atlantic. The Gulf Stream is a northward-flowing superhighway of ocean water off the U.S. East Coast. Running at full steam, the powerful current pulls water into its "orbit" and away from the East Coast.

But this summer, for reasons unknown, "the Gulf Stream slowed down," Edwing said, sending water toward the coasts-and sea levels shooting upward. Adding to the sustained surge, autumn winds from the northeastern Atlantic arrived a few months early, pushing even more water coastward. (Article continues: http://news.nationalgeographic.com/news/2009/09/090910-sea-levels-rise.html) "

As to spending money on elevated roadways; wouldn't it be less expensive to buy taxpayers, hip waders? Then there is the matter of why Miami and Miami-Dade County are zoning more development in the way of the rising tides from climate change. But that's another story, for another day.

Visit msnbc.com for Breaking News, World News, and News about the Economy

Lite News for a Heavy Time: is it even possible to know what the Miami Herald is thinking? by gimleteye

Sunday's top of the fold story: "Train thief took a 120-ton joy ride" is still bugging me. Perhaps Herald executives commissioned a public opinion poll showing people are attracted like bees to pollen by train stories, and, joy rides. Any how, the depression zeitgeist is lite news for a heavy time. (click 'read more')
I would have been looking for another kind of story of joy rides. One of enough consequence to compel readers to pick up the newspaper. For instance: how Herald advertisers from the production home building industry took the nation on a joy ride, urged on by local bankers feeding financial derivatives tied to mortgages, making millions at every slice and dice along the way, destroying wetlands and drinking water aquifers, before crashing the economy into a wall, climbing out of the car and running away from the scene of the crime.

Of the MBA's who were driving the train, the New York Times reports, "It's so obvious that something big has failed," said Angel Cabrera, dean of the Thunderbird School of Global Management in Glendale, Ariz. "We can look the other way but come on. The CEO's of those companies, those are people we used to brag about. We cannot say, "Well it wasn't our fault" when there is such a systemic, wide-spread failure of leadership." (Is it Time to Retrain B-Schools, New York Times, March 15, 2009)

The comment echoed something I had just read in a fantastic account of wrack and ruin of Florida's environment, "Paving Paradise: Florida's Vanishing Wetlands and the Failure of No Net Loss." The writers report an internal email of one National Park Service official representing the Everglades against the predatory practices of rock miners in the Lake Belt region of West Miami Dade, "Florida is in a state of cannibalism, eating itself to increase its infrastructure."

Isn't it interesting the the John S. and James L. Knight Foundation, built by the Herald fortune and supervised by successive Miami Herald retired publishers, has never funded journalism to this effect: how to assess the cannibalism masked as Chamber of Commerce values? Talk about joy rides.

McClatchy, to be de-listed? by gimleteye

Bloomberg: McClatchy Co. will eliminate 15 percent of its workforce, slash executive and director pay and halt bonuses after the U.S. economy shrank at its fastest rate in 27 years last quarter. (Click 'read more')

McClatchy to Cut 15% of Jobs, Sees $30 Million Charge (Update1)

By Greg Bensinger

March 9 (Bloomberg) -- McClatchy Co. will eliminate 15 percent of its workforce, slash executive and director pay and halt bonuses after the U.S. economy shrank at its fastest rate in 27 years last quarter.

The publisher of the Sacramento Bee and Miami Herald plans to cut 1,600 jobs throughout the business, starting this month. McClatchy expects about $30 million in severance costs, it said in a statement today.

McClatchy has eliminated its dividend, halted matches to employee 401(k) funds and froze employee pension plans after its advertising revenue plunged 18 percent last year. It may lose its stock listing if it doesn’t lift its share price.

Elaine Lintecum, McClatchy’s treasurer, declined to say how much the company expects to save. Each of the company’s roughly 80 daily and non-daily newspapers would determine salary cuts and other savings, she said in an e-mail.

McClatchy, based in Sacramento, California, plunged 13 cents, or 22 percent, to 46 cents at 9:58 a.m. in New York Stock Exchange composite trading. The shares dropped 15 percent this year before today.

Chief Executive Officer Gary Pruitt’s base salary will be cut by 15 percent and he, like other executives, won’t receive a 2009 bonus, the company said. Pruitt’s salary in 2007 was $1.1 million.

Board members’ cash compensation will be reduced by 13 percent, and they won’t receive any stock awards for 2008 or 2009, McClatchy said.

An announced reduction on March 5 of about 130 jobs, or 12 percent, at McClatchy’s Star-Telegram in Fort Worth, Texas, will be counted toward the 1,600 cuts, Lintecum said. The newspaper said it would slash salaries as much as 10 percent.

If the U.S. recession persists through the first half of this year, it will the longest since the Great Depression. The economy shrank at a 6.2 percent pace in the fourth quarter of 2008, the weakest performance since 1982.

To contact the reporter on this story: Greg Bensinger in New York at gbensinger1@bloomberg.net

Sentinel editorial page beats The Miami Herald... by gimleteye

The Miami Herald is suffering massive financial losses. Reportedly, the newspaper is for sale. But that's no excuse for its poor editorial coverage of the housing collapse and related phenomenon. The Tribune is bankrupt, but its coverage--through the Orlando Sentinel-- excels. Here's an Orlando Sentinel editorial that many Miami Herald readers are interested in: the potentially calamitous effect on growth "management" in the State of Florida from the Republican-led legislature. Why aren't these issues being covered by The Herald? (please click, read more).

OrlandoSentinel.com

We think: Even in a recession, lawmakers must respect the environment
February 26, 2009


Days before the start of the legislative session, Tallahassee's resembling a MASH unit, trying to restore the state's health by stabilizing services ranging from education to transportation.

If state government's triage neglects the environment — typically ignored or mistreated during dire economic times — it can forget about any chances of a full recovery.

Unfortunately, efforts are under way that essentially could rub out what's left of the state's efforts to manage growth. And building on the progress the state has made in the fight against climate change is no longer certain, either.

Here are the challenges lawmakers and Gov. Charlie Crist must work to overcome:

False promises



A group of lawmakers led by Sens. Mike Bennett of Bradenton and Don Gaetz of Niceville is promoting a bill that would do away with road-building requirements the state now imposes on developers. Critics of Florida's so-called "concurrency" rules contend the costs have either stymied construction or driven developers to abandon the cities for rural areas, where they can build more cheaply and, in the process, create sprawl.

The senators propose eliminating the transportation requirements in urban areas so developers can build up, making cities more vibrant places to live, curbing growth in pristine areas and stimulating the economy to boot.

Encouraging population growth in metro areas — not in rural outposts like Yeehaw Junction — is what responsible land planners and managers also want. It's what the state's top growth manager, the Department of Community Affairs' Tom Pelham, wants, too. It's what we've advocated.

But oh, the bill's pesky details. Turns out it wouldn't just eliminate those transportation costs for developers in dense urban areas. They'd vanish in cities and counties with more than 1,000 people per square mile or with a population of more than 1 million.

That means developers could escape the cost of building roads in Hillsborough County, home to Tampa but mostly a rural landscape and, of course, Orange County, home to Orlando but also vast stretches of land still vulnerable to development.

There's another thing. In those and other heavily populated counties, the bill would do away with separate reviews of large-scale developments, reviews that have worked to safeguard imperiled species and environmentally rare or sensitive landscapes in rural areas.

Sens. Bennett and Gaetz are expected to retool the bill — hopefully, so it won't compromise efforts to prevent sprawl in rural Florida. Anything less would harm the state.

Hot air



Lobbyists for utilities, the automobile industry and other business interests count several allies in the Legislature eager to resist some of the governor's bold but needed initiatives to fight climate change. House Republican leaders are opposing Mr. Crist's call for legislation modeled after California and New York laws that would limit auto emissions.

They're also looking to "modify" Mr. Crist's clean-energy standards, including his call to reduce carbon emissions 80 percent from 1990 levels by 2050, and for utilities to produce 20 percent of their energy from renewable resources.

And the state's land-buying program that the governor has pushed the Legislature to fully fund, and which the Legislature last year reauthorized, likely will face legislative raiders. They're eager to send the money elsewhere, even though vast tracts needed to preserve water basins and wildlife corridors can be had in the current market for fire-sale prices.

In this economy, the saboteurs and opponents contend, it's not the time to go green.

But they'd oppose that movement in a booming economy, too.

Leaders in the Senate, including Republicans like Lee Constantine, are pushing right back at the House on emissions standards and with new regulations to protect springs, rivers and lakes from harmful fertilizers and leaky septic tanks.

Mr. Crist also should be able to bypass some of the House's resistance to funding green programs by tapping revenues now flowing from Washington. A state energy program that had offered $1.5 million in competitive grants to businesses and educators promoting alternative energy now should have $126 million in federal money.

An adviser to the governor notes most of the green investments can make the state more energy independent — a boon in this or any economy. He's right. Now's not the time for the state to weaken its efforts.
Copyright © 2009, Orlando Sentinel

A good summation by Dean Baker: Plunder and Blunder ... by gimleteye

Dean Baker writes an excellent summary of the causes and origins of the economic crisis. (Click, 'read more'.) He writes along the lines that I've been exploring on Eyeonmiami for a long time: "The real problem is that the public, including many of the pension fund managers who were taken for a ride, still don't understand what has happened. Perhaps the main reason for this confusion has been the quality of economic reporting. The media relied almost exclusively on the folks who got it wrong. The industry bubble-pushers and the bubble-deniers in policy positions were almost the only sources for economic reporting during the bubble years."

The media relied almost exclusively on the folks who got it wrong. Indeed. And in respects to the trillion dollar fiscal stimulus, still is.

Among the people who got it right were those who objected at public hearings across Florida to platted subdivisions zoned and permitted to ruin natural resources, streams, lakes and bays. (cf. Greenberg Traurig) But economists don't attend those hearings and don't follow how the corruption of local politics ties into finance. There are no "misery" indexes to track, along with disparities that Baker notes.

Newspapers publishers and editors (cf. The Miami Herald) confined such complaints to occasional "environmental" stories buried in the B section of the newspaper and even rarer appearances on the front page. If you had asked the paper's publisher/s and if you had gotten an honest answer, it would have been along the lines of: "people don't care about the environment the way they do about business. These environmental "battles" are examples of a privileged elite complaining about growth that is necessary." They might or might not have added that their own compensation relied on profitability of the newspaper that depends on keeping advertisers happy and content. In other words no adverse stories that could threaten their paychecks.

Now, I suppose, it is clear what a privileged elite did to the entire US economy while the media was sleeping.


Plunder and Blunder; How the 'Financial Experts' Keep Screwing You
By Dean Baker, PoliPoint Press
Posted by Alternet on February 7, 2009, Printed on February 7, 2009
Editor's Note: The following is an excerpt from Plunder and Blunder: The Rise and Fall of the Bubble Economy by Dean Baker, published by PoliPoint Press, 2009.

The stock market and housing bubbles were the central features of the U.S. economy over the last 15 years. The stock bubble propelled the strongest period of economic growth since the late 1960s. The housing bubble lifted the economy from the wreckage of the stock bubble and sustained a modest recovery, at least through 2007. However, financial bubbles by definition aren't sustainable, and when they collapse, they cause enormous social and economic damage.

The economy had no problem with financial bubbles during its period of strongest and most evenly shared growth, the years from 1945 to 1973. It only became susceptible to bubbles after the pattern of growth had broken down  -- when most workers no longer shared in the benefits of productivity growth, and businesses no longer routinely invested to meet increased demand based on growing consumption. We don't have enough evidence to say that bubbles are a direct outgrowth of inequality, but, again, we do know that bubbles weren't a problem when income was more evenly distributed.

The bubbles were allowed to grow only because the people in a position to restrain them failed in their duties. The leading villain in this story is Alan Greenspan. Greenspan mastered the art of currying the favor of the rich and powerful and held top economic positions under five presidents of both political parties. He also managed to gain a near cult-like following among the media. As a result, most of the public is largely unaware of how disastrous the Fed's policies under his tenure were for the economy and the country.

Most of the economics profession went along for the ride, somehow managing to miss a $10 trillion stock bubble in the 1990s and an $8 trillion housing bubble in the current decade. If leading economists had recognized these bubbles and expressed concern about the inherent risks, they could have alerted the public and forced a serious policy debate on the problem. Instead, the leading voices in the profession joined the chorus of Greenspan sycophants, honoring him as potentially the greatest central banker of all time.

The financial industry proved to be more incompetent and corrupt than its worst critics could have imagined. Did people who manage multi-billion dollar portfolios in the late 1990s really believe that price-to-earnings ratios would continue rising, even when they already exceeded 30 to 1? Or did these highly paid fund managers believe that PE ratios no longer mattered  -- as though people bought up shares of stock because the stock certificates were pretty?

It's hard to understand how anyone who managed money for a living could have justified keeping a substantial portion of their funds in the ridiculously overvalued markets of 1999 and 2000. You could play the bubble, riding the wave up and dumping stock before the crash. But a buy-and-hold strategy in 1999 and 2000 was a guaranteed loser. In the late 1990s, Warren Buffet famously commented that he didn't understand the Internet economy, and thus he pulled much of his portfolio out of the market. Buffet understood the Internet economy very well. He recognized a hugely overvalued stock market that was certain to crash. Why didn't fund managers?

The financial industry's conduct in the housing bubble was even worse. House prices had sharply diverged from a 100-year trend without any explanation. Furthermore, vacancy rates were at record highs and getting higher. In introductory economics, we teach students about supply and demand. If the excess supply keeps growing, what will happen to the price? Furthermore, inflation-adjusted rents weren't rising through most of the period of the housing bubble. There will always be a rough balance between sales price and rent. When sales prices diverge sharply from rents, some owners become renters, reducing the demand for housing. Similarly, some owners of rental units convert them to ownership units, increasing the supply of housing.

Decreased demand and increased supply lowers the price; what part of that reality did the highly compensated analysts fail to understand? How could the CEOs of the country's two huge mortgage giants, Fannie Mae and Freddie Mac, have been surprised by the housing bubble? The Wall Street wizards at Merrill Lynch, Citigroup, Bear Stearns, and elsewhere were probably even worse. Did they really have no idea that the bubble would burst and that a large amount of mortgage debt, especially subprime mortgage debt, would become nearly worthless? Did they think that this junk could be made to disappear through complex derivative instruments?

Wall Street sold these instruments to pension funds and other institutional investors. It also persuaded state and local governments to pay them billions of dollars in fees for issuing auction rate securities and for buying credit default swaps and other exotic financial instruments. In addition, many of the same institutional investors lost billions of dollars by holding the stock of companies like Merrill Lynch, Citigroup, and Bear Stearns, the value of which was driven into the ground by very highly paid executives.

The real problem is that the public, including many of the pension fund managers who were taken for a ride, still don't understand what has happened. Perhaps the main reason for this confusion has been the quality of economic reporting. The media relied almost exclusively on the folks who got it wrong. The industry bubble-pushers and the bubble-deniers in policy positions were almost the only sources for economic reporting during the bubble years. The vast majority of the people who follow the news probably never heard anyone argue that the economy was being driven by a stock bubble in the 1990s or a housing bubble in the current decade. Such views simply were not permitted. (The New York Times deserves special mention as a media outlet that actively sought alternative voices, especially during the housing bubble.)

Knowingly or not, these outlets have covered up the extraordinary incompetence and corruption that allowed these bubbles to grow. For example, in a recent three-part series on the housing bubble, the Washington Post reported a claim from Alan Greenspan that he first became aware of the explosion in subprime mortgage lending as he was about to leave his post as Fed chair in January of 2006. According to the article, Greenspan said he couldn't remember if he had passed this information on to his successor, Ben Bernanke.

This article makes it sound as though the explosion in subprime lending was an obscure piece of data only available to a privileged few. In reality, the explosion in subprime lending was a widely discussed feature of the housing market during the bubble years. If Greenspan was implying that he was unaware of this explosion, he was unbelievably negligent in his job as Fed chair. The notion that Greenspan would have to pass this information on to his successor  -- as though an economist of Bernanke's stature could be unaware of such an important development in the economy  -- is equally absurd. In other words, the Post article helped Greenspan present a remarkably straightforward development  -- namely, the massive issuance of bad loans  -- as complex and confusing.

In the same vein, the Wall Street Journal provided cover for Treasury Secretary Henry Paulson by explaining how the collapse of Fannie Mae and Freddie Mac caught him by surprise. These two financial institutions hold almost nothing except mortgages and mortgage-backed securities. What did Mr. Paulson think would happen to them in a housing crash?

The secret of these two bubbles is that there is no secret. Anyone with common sense, a grasp of simple arithmetic, and a willingness to stand up against the consensus could have figured out the basic story. The details of the accounting scandals in the stock bubble and the convoluted financing stories in the housing bubble required some serious investigative work, but the bubbles themselves were there in plain sight for all to see.

The public should demand a real accounting. Why does the Fed grow hysterical over a 2.5 percent inflation rate but think that $10 trillion financial bubbles can be ignored? Where was the Treasury Department during the Clinton and Bush administrations? What about congressional oversight? Did no one in Congress think that massive bubbles might pose a problem? Why do economists worry so much more about small tariffs on steel and shirts than about gigantic financial bubbles? What exactly do the people who get paid millions of dollars by Wall Street financial firms do for their money? And finally, why don't the business and economic reporters ask any of these questions?

The stock and housing bubbles have wreaked havoc on the economy and will cause enormous pain for years to come. We can't undo the damage, but we can try to create a system that will prevent such catastrophes from recurring and that ensures that people responsible for these preventable events are held accountable. That would be a huge step forward.

Copyright PoliPoint Press 2009.

Click here to buy a copy of

Plunder and Blunder: The Rise and Fall of the Bubble Economy

The financial worth of newspapers, measured by rate of decay ... by gimleteye

Yesterday, McClatchy announced cost-cutting measures that must be very upsetting to Miami Herald employees. Publisher David Landsberg wrote a memo, "This morning, McClatchy announced that it is freezing its pension plans and temporarily suspending the company match to its 401(k) plans, effective March 31." Talk about distress signals.

Landsberg goes on, "Here at the Miami Herald Media Company, we have seen an unprecedented loss in advertising revenue, with quite a few of our retailers and auto dealers going out of business or leaving the area. In addition, employment advertising revenues continue to drop to all-time lows and real estate remains very weak. These challenges are clearly driven by a deepening recession that is hurting our economy. We are still developing our plan to address this extraordinary economic challenge."

I don't believe Landsberg has a plan, any more than his immediate predecessors did-- except to the extent it meant skewing the reporting of the news toward the paper's big advertisers. In its avoidance of reportage that alienated advertisers-- like the explosion of unsustainable development in South Miami Dade--the Herald and other mainstream media blinded themselves to the unfolding economic disaster built on unsustainable credit and the explosion of debt and also lost the trust of readers.

It is clear enough that the costs of newsprint and distribution can't outlast this economic crisis. The moment for private equity investors to step in and rescue small regional and local newspapers has passed; it's an unattractive scenario to measure the worth of a newspaper by its rate of decay.

There's a bigger issue: can democracy survive without print newspapers? I wonder if my fear is a generational bias. Perhaps the Herald needs to go all-electronic and all local with its reporting. Will advertisers trust that format?

Miami's media still MIA on housing crash impacts, by gimleteye

Miami-Fort Lauderdale is the most overbuilt market in the nation for subdivision homes, according to a report released last Thursday by housing market data provider Metrostudy. You didn't read the story in The Miami Herald.

Six out of the top ten areas of the nation with the most oversupply of subdivision housing are in Florida. That's quite a record, but local readers at the epicenter of the political and economic ground zero of the housing asset bubble and collapse wouldn't have seen it. You had to read the Fort Myers News-Press for that.

Instead on Saturday, the Herald published "New rules raise the bar for condo mortgages in Florida." (Miami Herald, Jan 24, 2009). The story skips past the vast oversupply of condos in Miami and focuses on grievances against Fannie Mae's new lending bar against certain condominiums in Miami.

The article could easily have moved in the direction of reporting how Fannie Mae was responding to its own dire financial circumstances, brought about by greedy executives paid hundreds of millions to inflate the risk to taxpayers to the bursting point. That point is buried in the middle of the story: "Charles Foschini, vice chairman of debt and equity finance for brokerage CB Richard Ellis in Miami, said Fannie was protecting investors, borrowers and taxpayers, as it should in a climate of increased risk."

Instead the focal point of the Herald's report is that Fannie Mae will be making it even harder to fill buildings that are struggling under the weight of low occupancy, high maintenance costs, and foreclosures as credit tightens. The story leans to the point of view of South Florida real estate consultant Jack McCable, who says Fannie Mae's timing "couldn't be worse." Then it goes on, to end: ''To have the major source of loans draw a line through us is terrible; it's wrong and it shouldn't happen,'' Dodge said. "The feds can't pull the rug out from under us.''

The timing couldn't be worse; a result in part because Miami's media was part and parcel of the building boom and housing asset bubble. Without independent criticism of the bubble as it was inflating by the media, how was any countervailing force to build? Critics of the boom--environmentalists, for instance-- were given short shrift by the mainstream media; it was OK to be an advocate for wildlife, for instance, but not for economics which were, by some form of reasoning influenced by advertisers, only the provenance of qualified, sober, community-minded business interests. The Miami Herald, in particular, stifled any reporting of dissent or breath of consequences. It is still missing in action, on connecting the dots of the political origins in Miami of the housing bust despite strong investigative reporting like "Borrowers Betrayed" and "House of Lies". Those focus on poor exploited victims of fraud. In 2005, former president of the Latin Builders Association Willy Bermello was given the space on the Herald editorial page to write, "The bubble is not latex, it is stainless steel," the Herald editorial board allowed no counterpoint, no hint of doubt; it still is missing the story of the political origins of this economic disaster and its conception in subdivisions allowed to proliferate in Miami-Dade farmland.

Not only should the rug be pulled out, the US Department of Justice should go after those who caused this economic calamity.Would Alex Acosta, the US Attorney for Miami, be willing to test the principle of the "Honest Services Act" rule, as DOJ did in Palm Beach County?

The concept of “honest services” is derived from 18 U.S.C. Chapter 63 on Mail Fraud.
Under 18 U.S.C. § 1341 (Frauds and swindles),
Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, or to sell, dispose of, loan, exchange, alter, give away, distribute, supply, or furnish or procure for unlawful use any counterfeit or spurious coin, obligation, security, or
other article, or anything represented to be or intimated or held out to be such counterfeit or spurious article, for the purpose of executing such scheme or artifice or attempting so to do, places in any post office or authorized depository for mail matter, any matter or thing whatever to be sent or delivered by the Postal Service, or deposits or causes to be deposited any matter or thing whatever to be sent or delivered by any private or commercial interstate carrier, or takes or receives therefrom, any such matter or thing, or knowingly causes to be delivered by mail or such carrier according to the direction thereon, or at the place at which it is directed to be delivered by the person to whom it is addressed, any such matter or thing, shall be fined under this title or imprisoned not more than 20 years, or both.

And, pursuant to 18 U.S.C. § 1343 (Fraud by wire, radio, or television): Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communication in interstate or foreign commerce, any writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice, shall be fined under this title or imprisoned not more than 20 years, or both.


Fixin' to pitch a fit over Wall St. greed

By Jay Bookman

The Atlanta Journal-Constitution

Monday, January 26, 2009

If you're looking for a place to put the pittance you salvaged from
the stock market, I've spotted the next hot commodity, the next growth
industry. Under these conditions, demand is going to soar for this
item, and there's money to be made.

You ready? I'll whisper it in your ear, just between us friends:

"Pitchforks."

Yup, pitchforks. With good solid handles and sharp tines. When the
angry mobs start assembling to march on Wall Street and Washington,
ready to take out their anger at the greed and excess of the last few
years, they're gonna need pitchforks and torches. We'll sell 'em by
the thousands, like Obama buttons at the inauguration.

Tar-and-feather futures might not be a bad investment either.

I'm kidding of course, but only sort of. Like a lot of Americans, I'm
aggravated and frankly astonished to see the sense of royal
entitlement to other people's money that developed over the years on
Wall Street. And nothing seems to shake it.

The story of Bank of America, Merrill Lynch and Merrill's former CEO
John Thain illustrates that sense of entitlement all too well.

Last year, Merrill Lynch lost tens of billions of dollars —- $15
billion in the last quarter alone. Yet even after that performance,
Merrill executives felt they were entitled to billions in bonuses paid
with stockholders' money.

It didn't matter that Merrill's losses were so bad that in effect the
brokerage had to be rescued by taxpayers. It didn't matter that the
U.S. Treasury had to give Bank of America a total of $45 billion in
TARP funds to help the bank buy Merrill and save it from bankruptcy.

Not even that was enough to shake the sense of royal entitlement. Late
last month, just before the merger was made official and with Bank of
America still finalizing the taxpayer subsidy, Merrill executives
collected an estimated $3 billion to $4 billion in bonuses. They even
accelerated the payment schedule by a month to make sure the money
flowed their way before anybody could stop it.

Like I said: Pitchforks.

Thain, Merrill's CEO, at first tried to include himself in the gravy
train, pushing for a $10 million bonus even as the company collapsed.
Public outrage prevented that injustice, but it did not stop Thain
from pocketing a separate $9.7 million payment triggered by the change
of ownership. That was on top of the $15 million bonus he received
just for taking the Merrill job just a year earlier.

And as the cherry on the sundae, Thain had also spent an estimated
$1.2 million just redecorating his office.

On the scale of threats to the economy, such sums are admittedly
almost too minor to notice. Officials in government and on Wall Street
are trying to free up the flow of credit; they're trying to bolster
confidence in the banking industry; they're trying to save the jobs of
millions of Americans. And the honest ones admit that they aren't
really sure what will turn things around.

"The answer is nobody knows. The economists don't know. All you know
is you throw everything at it …" Warren Buffett said last week. "What
we do know is to stand by and do nothing is a terrible mistake or to
follow Hooverlike policies would be a mistake."

The American people seem to understand that. President Obama said in
his inaugural address that it's time to put away childish things, and
most Americans have taken a pretty mature approach to a frightening
situation.

However, their support for committing hundreds of billions of
additional taxpayer dollars to corporate bailouts hangs on the belief
that Wall Street shares their understanding of the gravity of this
situation. People have lost half of their life savings, and perhaps
their homes and jobs too, and they want some assurance that the greed
and excess has ended. They want to know that they're not being scammed
again.

And if government officials aren't willing or able to provide that
assurance —- well, the public probably won't respond with pitchforks.
They'll just insist the bailout be stopped in its tracks, and it'll be
hard to blame them.

jbookman@ajc.com

On Lennar and what is Eyeonmiami doing to 'help'? by gimleteye

I received two recent comments from readers, expressing different points of view about our blog, Eyeonmiami.blogspot.com

On "Lennar's Peace-of-Mind Job Loss Mortgage Payment Protection Program" a reader writes: "LSD and Houses - This post is silly. This company is not the only one offering some kind of payment incentive and I dont get what you are complaining about. Did lennar do something to you? What the hell are YOu doing to help. This post FAILS. You own me $$$ for reading it."

Another reader writes: "Please do not think i am being cynical as I mean it from the heart when i wish you all the very best in 2009. You are a ray of sanity in an otherwise gloomy and frustrating low ebb in human activity. Keep up the great work, you articulate for us who are not very good at expressing what we understand, experience and feel know has to be said. thankyou, thankyou, thankyou."

Let me try to address some points raised by reader #1.

Lennar's ad appeared on A1 of the real estate advertising section. It was noteworthy and included few details and a long disclaimer at the end. In my opinion, it was the worst form of incentive to consumers already battered and bruised by the collapse of the housing asset bubble.

On the question, "Did Lennar do something to you?", the corporation has been and continues to be at the center of local zoning decisions that we have written about extensively. Not in the way reported in recent news or on other critical housing blogs. Our tax dollars have been regularly employed on behalf of prominent developers like Lennar in ways we disagree with. Lennar's expired Florida City Commons plan in Miami-Dade comandeered a big investment of county staff, time and energy to break through the Urban Development Boundary.

In our archive, among thousands of individual blog posts over a period of years, readers can find other information on the role of lobbyists and corporations like Lennar to break through the Urban Development Boundary. What else has Lennar done? At the same time as Florida City Commons was being muscled forward (at the height of the housing boom), Lennar and its lobbyists pushed forward in closed meetings at County Hall for an affordable housing ordinance that in key respects omitted the needs of the neediest. The company heavily lobbied the annexation by Florida City of property in Miami Dade County in advance of its Florida City plan that many objected to on the grounds of important federal and state environmental laws.

I have written about the housing bubble financing methods in terms of metaphors, too: weapons of mass financial destruction or financial hallicinogens-- choose your poison. I'm not far off given the collapse of the US private banking system triggered by layers and layers of speculation by men and women of supposedly high standing.

If you trace the misplaced risk analyses by investors, by builders, and individuals who in many cases were encouraged to buy homes they could never reasonably afford, you arrive at the greatest jeopardy to the free enterprise system in modern history: the nationalization of the private banking industry. Put another way, it took no ideology to get us there other than greed.

Back to the question, 'how does Eyeonmiami help?' Many readers appreciate the information and views we provide. We add to a wider dialogue in the sunshine. That irritates some builders who have pressured the media by picking up the phone and calling the publisher or arranging special meetings in newspaper conference rooms from which reporters are excluded. By doing what we do, we 'help' public officials understand that the public cares, reads, and follows what is happening in our communities.

Corporate irresponsibility and private greed helped trigger the housing bubble an economic and political fact. We began providing this viewpoint to our readers well before the mainstream media would touch the subject. And we have connected the dots to the seeds of financial despair descending on so many families.

Lastly, I am deeply sceptical of federal intervention to "bailout" production homebuilders. Lennar and other homebuilders are pleading with Congress to allow them to write-off losses against profits stretching back into the boom.

Taxpayers never were asked to vote on whether they supported in the first place the economic policies and models that lead to the bubble in the first place, whose collateral damage to our quality of life and environment has been severe; why should we bail them out after so many unheeded warnings proved true? Many responsible homeowners and citizens were appalled by the lack of personal and corporate responsibility that fomented the housing bubble. Now we should allow federal tax policy to write-off those errors which already conferred great wealth on a few and socialized risk for millions of Americans?

As reported by Reuters yesterday, NAHB Chief Economist David Crowe said in a statement. "The fact that there has been microscopic movement in the historically low (consumer confidence)... over the last three months provides further evidence of the need for government action to rejuvenate housing demand," he said."

As far as owing our reader money to read our post; it could be a threat or a joke. Dumping more money into a failed economic model will inevitably lead to inflation and consequences even more serious than we have already endured.

In the not-too-distant future there will be a huge debate how to consume billions in federal tax dollars parachuted to the states from the federal government. Land speculators and big developers like Lennar whose financial model is built on large scale will want to steer those dollars to support new sprawl, new "transportation improvements" that do little for the needs of existing residents. We will object. And we will contest the pitch that investment in housing and infrastructure to serve sprawl creates the kind of lasting economic growth our nation desperately needs. That is our point of view.


January home builder sentiment sinks to new low
Wed Jan 21, 2009 1:48pm EST
By Julie Haviv

NEW YORK (Reuters) - Home builder sentiment sank to a new low in January as concerns about the faltering economy and reluctant home buyers hurt confidence in the market for newly built single-family homes, an industry group said on Wednesday.

The National Association of Home Builders said its preliminary NAHB/Wells Fargo Housing Market Index was 8 in January, down from 9 in December. That is the lowest level on record since the gauge was launched in January 1985.

Readings below 50 indicate more builders view market conditions as poor than favorable. The January index was below expectations of 9, based on a Reuters survey of economists.

Eric Belsky, executive director at Harvard University's Joint Center for Housing Studies, said home builders are not only struggling under sinking demand and a credit crisis, but are facing a flood of homes in foreclosure.

"They have been responding to slack conditions by reducing production dramatically, but demand continues to fall and until that comes back, the drop in production is not enough to make the market turn around," he said.

Interest rates on mortgages have fallen sharply recently, a key development that could help turn around the hard-hit housing sector, but not enough to improve demand at this point.

"Even though we have lower mortgage rates, people are staying sidelined out of fear over further home price drops, anxiety about the economy, their income and their job," Belsky said.

The housing market is suffering the worst downturn since the Great Depression as a huge supply of unsold homes, tighter lending standards and record foreclosures push down home prices.

"Clearly, conditions in the nation's housing market aren't getting any better, and they aren't going to get any better until the federal government takes substantial action to encourage qualified buyers to get back in the market," NAHB Chairman Sandy Dunn, a home builder from Point Pleasant, West Virginia, said in a statement.

The gauge of current single-family homes sales fell to 6 from 8. The index of sales expected in the next six months, however, increased to 17 from 16. The prospective-buyer traffic measure also climbed, rising to 8 from 7, the group said.

Home builders have curbed new construction as they have been working through inventories of unsold homes by slashing prices at the expense of profits to pay off debt and keep afloat.

"Builder views continue to track with historically low consumer confidence measures," NAHB Chief Economist David Crowe said in a statement.

"The fact that there has been microscopic movement in the historically low HMI and its component indexes over the last three months provides further evidence of the need for government action to rejuvenate housing demand," he said.

(Editing by Leslie Adler)


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McClatchy in the News ... by gimleteye

What do the paeans to Alvah Chapman and the busted deal for downtown Herald property have to do with one another ("Extension for Herald land deal", Miami Herald, Jan 1, 2009)?

By all accounts, Alvah Chapman was an honorable man, unwavering and dedicated to his personal values. But unconditional praise of his leadership of the Herald and in the community is no more warranted than a free pass to the city's only daily newspaper for missing the biggest story of the century: the development asset bubble now crashed in the worst economic crisis since the Depression.

Today, the financial viability of McClatchy is in doubt. The busted land deal shows the corporation manoevering to monetize its most valuable asset, land beneath the Herald offices on Biscayne Bay. As the Herald notes, today, the parent company's share price closed Wednesday at $.80, from $12.50 a year ago. The $190 million busted deal for the Herald property, conceived at the height of the building boom, now represents three times the value of the entire corporation.

But remember: at the time the Herald deal was announced, there was nary a peep from the paper how its dismal coverage of the real estate asset boom was partly in consideration of the paper's vested stake in the speculative bubble; especially the value of stock options granted to key executives.

During the entire run-up of the real estate bubble, that triggered a national economic crisis-- critics never had a voice at the Herald any more than they did in criticizing its political origins that pushed Jeb Bush to the governor's office twice and that Alvah Chapman represented.

Instead, readers were treated to viewpoints like Willy Bermello's famous 2005 editorial, “Build Them, and They Will Come” (May 21, 2005), “... real estate continues to still be a safe harbor for investors, whether it be equity or the purchase of a condo in South Florida, where doubling of your investment in less than two years is commonplace. If you have euros or British pounds, then you buy with a built-in 30 percent to 40 percent discount. Miami deserves its place next to Shanghai and Dubai. More important, it deserves our confidence. The bubble is not latex but stainless steel.”

The only thing that was stainless steel was the impervious nature of a well-heeled economic and political elite in South Florida that did not tolerate dissent. Mr. Bermello is a former president of the Latin Builders Association; the substantial player in the real estate asset bubble run-up through its lobbying for zoning and building permits of condos, sprawl, and a failed growth machine.

He is also of Miami's order that Mr. Chapman helped fashion called the Non-Group; a kind of hot house nursery for the generation of Hispanic leadership that assumed power in Miami-Dade County decades ago. It was built on construction and development.

After Hurricane Andrew, Mr. Chapman was asked by President Bush to lead We Will Rebuild. What obituaries have not mentioned is that there was, at the time, an outcry that the Herald also failed at first to credit; citizens raised objections as to, "who" will rebuild, and "we" will rebuilt, what?

Mr. Chapman and his allies dismissed suggestions; whether from women whose interests were not represented at first or community activists. For instance, what was re-built in Florida City, then, was exactly what had existed there before the hurricane despite a forward thinking study by architects and planners who had volunteered their time and energy to outline the opportunity for a new economic future based on integrating the built landscape with nearby national parks.

The spurning of a new direction in favor of the quick buck soon turned into the Homestead Raceway, and the miserable performance of county commissioners in protecting the public investment, and then the failed effor to redevelop the Homestead Air Base by Mr. Bermello's colleagues; all reinforced an immoveable political elite and forecast exactly what would happen as the 1990's evolved to the 2000's asset bubble in construction and development and housing.

From its market high on October 9, 2007 through December 31, 2008 the Dow Jones Wilshire 6000 has lost $6.7 trillion. The national median home price, from July 2006 to November 2008 has declined from $230,900 to $180,800. And we are witnessing the fading of The Miami Herald and the nation's newspapers without any admission of errors how the mainstream media and its voices were too close to the trees to see the forest or what hid there.

Am I Depressed This Holiday Season? You Betcha’! By Geniusofdespair

The State has a budget gap of $2.3 billion and counting, my portfolio is in the toilet, the Miami Herald might be bought by the very people we write about and, locally, Parkland goes before the County Commission next week, December 18th. Which has me most upset?

I have been kidding around about the newspaper but it really has me distressed. As much as I criticize the Miami Herald, I can’t imagine life here in Miami without it: an independent news source that actually pays reporters to dig up evil doings. Well, I guess I can imagine what it would be like, Rupert Murdoch’s Fox News. I wonder how editorials are doing over at the Wall Street Journal now? We would be seeing news through the eyes of whomever has the money to spare to buy the paper. That is not news. That is propaganda.

Governor Blagojevich of Illinois, among other things tried to intimidate a failing newspaper. He told the Chicago Tribune that the Illinois Finance Authority would only assist in the sale of Wrigley Field (one of the Tribune’s cash cows) if the paper fired its editorial board. Newspapers need to be independent, this is an example of what money woes can do to our quest for truth. What if the paper had agreed to his demands? He would not have been criticized any longer, the public would not know the truth about him.

I am not much for actual thinking today, but you get my drift, my fear: A Lobbyist/Developer/Power Broker owned newspaper. And, maybe worse, all the money woes today will influence the career choices of brilliant students, away from journalism tomorrow.

'Miami New Times" Supports My Buy of the Miami Herald, Except Doesn't Want the Competition. By Geniusofdespair

Apparently Kyle Munzenrieder of Miami New Times - Riptide 2.0 has been to my new blog Buy the Miami Herald. He writes: "Hey McClatchy, We Found You a Buyer."