Daily Archives: December 13, 2010

CNN/Money: Criminally Irreponsible

Desperate to get the game going again, they are encouraging home buying.

There isn’t even a disclaimer on the article.  At the very least, they should be ashamed of themselves (h/t zero hedge):

Latest down-leg in home prices accelerates

It’s perplexing that the latest down-leg in U.S. home prices has gone virtually unnoticed by the media and the markets. The Case-Shiller index is down in each of the past three months and there is still roughly two years’ of unsold inventory overhanging the market once the “shadow” foreclosure backlog is included.

Meanwhile, as we saw in the latest UofM consumer sentiment survey, demand is dormant as homebuying intentions slipped in December to a level that can only be described as anaemic. Mortgage applications remain near decade-low levels and part of this reflects lingering caution among private lenders who are still maintaining fairly stringent credit guidelines — have a look at Housing Shaky as Lenders Tighten on page A4 of the WSJ. Interesting enough, the banks are once again sending out credit cards en masse — perhaps because borrowers this cycle have ensured that they stay current on their plastic even as they fall behind on their mortgage payments — see Lenders Return to Big Mails on Credit Cards on the front page of today’s NYT.”

Bastards, lying to their readers to benefit themselves.

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Filed under financial crisis

Legal Fees (a/k/a “Money IV”?)

Norm Pattis brings up a too little discussed topic among lawyers, and does it in the right way.  As in, who the hell is some bureaucrat to come along and second-guess whether a legal fee is “reasonable”?

The bureaucrat would be a “lawyer” from the disciplinary committee, of course.  But in general these people are not real lawyers.  They have never had clients.  They have not had to live on legal fees.  Rather, they have held government positions their entire careers and then presume to sit in judgment over what some other lawyer, who has done those things, has charged or received for his work.

Legal fees are extremely difficult to quantify.  Contingency fees are working “on spec”, but it’s a huge gamble undertaking litigation with your only hope of payment being a “favorable outcome”, whatever that is.

By contrast, large firms generally charge by the hour, and within their business model their clients can mostly afford it.  Then again small, independent firms and solos, particularly those doing criminal defense, could try to charge by the hour but the monthly invoices quickly begin to resemble a very unlikely fantasy:  the clients simply can’t pay on that basis.

Elsewhere, in view of this reality, Brian Tannebaum has discussed rule #1 of criminal defense:  get paid in full up front.  But how does a lawyer calculate what constitutes “in full”?  Brian doesn’t say.

Let me fill the gap here:  it is a risk analysis.  The most important indicator of what the risks are is the severity of the charges the client faces, not the merit of the charges.  There are other factors but this one is by far the most important.

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Filed under Judicial lying/cheating