Ouch:

The most common subprime loans were known as "2/28" in the industry: 30 years, including a two-year teaser rate before the interest rate rose. Now these loans have reset, and we're seeing the fallout.

But prime borrowers, too, got loans that started out with low payments; if you bought or refinanced your house in the last few years, it's not unlikely that you have one. With an "option ARM" loan you have the "option" (which most borrowers happily take) of paying less than the interest; the magic of "negative amortization." The loan grows until you hit a specified point—the exact point varies with the lender; with Countrywide, it'll come after about four and a half years—when the payment resets to close to twice where it was on Day 1.

Just two banks, Washington Mutual and Countrywide, wrote more than $300 billion worth of option ARMs in the three years from 2005 to 2007, concentrated in California. Others—IndyMac, Golden West (the creator of the option ARM, and now a part of Wachovia)—wrote many billions more. The really amazing thing is that the meltdown in California is already happening and virtually none of these loans have yet reset.

Better Use Those...

...frequent flyer miles asap. According to this article, the airline industry is in major catastrophe mode. Interestingly, the article is not from some crazy outside source but from an industry trade publication.

Pay careful attention to the date of the article.

It was published in 2005 when oil was $60 a barrel--and almost all of the article's short-term predictions are proving accurate.

Train travel, anyone?

UPDATE:

More on the topic, here and here.

"The Story of Stuff"

Watch this fascinating and entertaining set of free videos here.

Books That Seem to Matter...

...we haven't finished it yet, but find it so interesting that The Transition Handbook warrants immediate recommendation.

One note: though the title may sound like another survivalist guidebook, the actual book is not. Instead, it takes a very reasoned and level-headed approach toward the different scenarios that a post-cheap oil world may encounter.

And, in doing so, recognizes that there are opportunities for good results--not just collapse scenarios (scenarii?).

So, Daily Sprawl recommends The Transition Handbook as a book that seems to matter.

"Scenes" from World Made By Hand...

...are now posted on the book's website. Once again, haunting music supported by thought-provoking narrative.

Prohibit Food Fuel...

...here's another instance of the problem with ethanol and other "food fuels":

Many believe that the food crisis is in its infancy and they worry about increasing food-based political instability worldwide.

British Prime Minister Gordon Brown said this week he's worried that ethanol production is pushing up food prices everywhere, and he called for an urgent review of the issue. Economist Dr. Hazell has said that filling an SUV tank once with ethanol consumes more maize than the typical African eats in a year...

...More profitable biofuel crops have now deprived the food chain of a large supply of corn and other crops, driving up the cost of corn-based food such as corn meal, tortillas, corn syrup and a hundred other crops and products which grace our tables at ever greater cost.

Let us again state this very clearly--in a world with a growing population, yet a finite amount of possible food production--using food (like corn) to create fuel is ridiculously short-sighted. Essentially, what it does is prioritize human transportation methods over human subsistence.

A grave miscalculation of the highest order.

No Aloha?

The recent events here in Hawaii and across the nation make you wonder just how risky is Hawaii's future.

For several years planners and futurists such as the University of Hawaii's James Dator pointed to a condition they call "Peak Oil" as the tipping point. Simply described "Peak Oil" is when the production of the global supply of oil starts to shrink.

Click here and read more.

A New Daily Sprawl Bookmarked Blog: Mish's Global Economic Trend Analysis.

Yeah, it sounds a little wonkish but the blog actually covers the pending economic challenges in a very approachable manner.

Check it out.

A Cool Tool...

A new Web-based tool developed by the Center for Neighborhood Technology, a Chicago-based urban development think tank, can help put facts behind those daydreams. The CNT developed a Web site, at http://htaindex.cnt.org, that takes into account household expenditures for transportation, along with home prices, to estimate whether a home is truly affordable for households with moderate incomes.

Read the whole story here.

First Major Retailer...

...looks ready to face the effects of peak energy:

Linens 'n Things Inc., a home-furnishings retailer caught by an increasing debt load and shrinking housing market, is expected to file for Chapter 11 bankruptcy-court protection by Tuesday, several people familiar with the matter said.

How Soon Until Peak Oil?

This article considers that question:

Fuel prices alone are unlikely to bring America to its senses.
It clearly will take outright shortages with lines at the pumps, curtailed deliveries and many other misfortunes before serious measures to deal with declining oil supplies –- speed limits, rationing, mandatory car pools, improved mass transit -- are taken. Thus the question becomes: how soon?

From a recent email...

I recently participated in an email exchange related to these important sprawl issues. I thought I'd post my response below. Hopefully it helps...

One of the most troubling things in Alabama is that state law prohibits the use of gas tax revenue for non-road building/repair transportation strategies.

What if a portion of the gas tax could be used to facilitate rail transportation between Huntsville, Birmingham, Montgomery, and Mobile?

Or, in a partnership with Georgia and/or Tennessee to extend rail options from Alabama to Nashville and Atlanta?

Ultimately, the long term future of air travel is bleak. Within 10 to 20 years, only the richest of rich will enjoy this perk. The concept of commercial aviation companies like Delta, Southwest, and United will be, at best, nostalgic reminders of a cheap oil era. One that fell victim to the ages-old reality that demand is always defeated by a lack of supply—in this case non-renewable fuels.

The outlook for commercial trucking is even worse. Hybrids and plug-in EVs might salvage some local vehicular travel but not the big rigs. They’ll lose out to the more cost effective (and less energy intensive) rail and river methods of transportation

As members of these communities, we can choose to embrace (and advocate) these issues today or we can continue down the dead-end route of supporting unneeded bypasses and elevated highways—an approach that will simply make the changes forced on us by Peak Energy that much harder to bear.

My Latest Column...

...from Future Montgomery Magazine discusses two downtown mixed-use projects and can be read here.

Grasping at...

...more desperate solutions.

Here's the deal: any "solution" to peak energy whose main goal is to maintain the current auto-centric lifestyle intact is not a solution at all but, rather, a diversion from the fundamental unsustainability of such a system.

It's the equivalent of an entire culture desperately banding together to save the beta-max.

In other words, ridiculously nostalgic, at best.

Getting Greener...

In addition to our local food efforts, the Daily Sprawl family is looking for other incremental ways to reduce our nonrenewable energy use. The idea being that alot of little steps can combine into big ones.

I recently replaced my gas lawn mower with this "reel mower" type. We have a pretty small yard so it works well. Plus, less noise, no fuel cost, and--in general--a better looking yard.

"A Deal with the Devil"

When Brian and Dawn McCausland bought this Colonial on a half acre in Montgomery County in 2004, they made a deal with the devil during a sky-high housing market: They and their four daughters would live here, but Brian would commute 100 miles round-trip to his job as an insurance adjuster in Delaware County.

A gallon of gas at the time was $1.76 - $150 a month for their 2002 Chevy Malibu. It beat paying more for a similar house closer to work.

But now, with gas averaging $3.30 and rising, the McCausland dream is getting soaked at the pump to the tune of $300 a month, or $3,600 a year, double their cost four years ago. They are among many families of modest means who took on big commutes from exurbia for a taste of upward mobility.

Read the whole--sadly all too common--story here.

Headline:

"Foreclosures Come to McMansion Country":

Million-dollar fixer-upper for sale: five bedrooms, four baths, three-car garage, cavernous living room. Big holes above fireplace where flat-screen TV used to hang.

The U.S. housing crisis has come to McMansion country.

Just as the foreclosure crisis has hollowed out poorer neighborhoods, "for sale" signs are sprouting in upscale developments so new they don't show up on GPS navigation screens.

Poor people weren't the only ones who took out risky, high-interest loans during the housing boom. The sharp increase in housing costs -- and the desire to live in brand-new, spacious houses with modern features -- led many affluent buyers to take out loans they couldn't afford.

The consequences of sprawl continue to demonstrate little distinction among its targets. The crazy thing is that there are literally hundreds of thousands of these McMansions, located in isolated places where daily things like a loaf of bread, can only be obtained via a car trip.

Now, the permanent increases in gasoline will make these places incredibly difficult to resell because fewer and fewer will be able to afford the auto-centric lifestyle that they demand.

This whole mess is spiraling and the spiral is getting faster and faster...

Local Food Sourcing

One thing that Daily Sprawl is focusing on these days is an effort to find our food more locally.

Doing so offers a variety of health benefits as well as reduces the need to transport food over large distances--something that will be nearly cost-prohibitive in a post-peak energy situation.

Here in Montgomery, we've started with the following:

1. Joining a Community Supported Agriculture with Bolling Bee Farms

2. Buying our grains, flour, and the like from Oakview Farms Granary

3. Considering the purchase of our meat products from Boutwell Farms

We also buy local eggs from a family at church.

Daily Sprawl will keep our readers updated on this effort to "go local" in response to the present energy and health challenges facing our world.

One Commentator Checks in with...

...his review of Austin, Texas--the venue for the recently completed 2008 Congress for the New Urbanism:

For all of its reputation as a lively place, Austin's city center didn't add up to much. Of course, there was the famous Sixth Street strip of music joints, which in recent years has morphed into a perpetual party scene in the mold of Bourbon Street in New Orleans -- except in the case of Austin, the buildings themselves are little more than packing crates with bars and bandstands, while the side streets are adorned with rows port-a-johns reeking in the impressive heat of the Texas spring.

While Kunstler typically writes more as a cynic, we shared several of his impressions about Austin's urbanism.

All in all, a city full of potential that appears to be slowly being realized. But, if that occurs in the form of those tall condo towers, then the potential is in (to use the words of one infamous Texan) "big time" trouble...

Daily Sprawl Recommends...

...this documentary from the Canadian Broadcast Company.

Click here to learn more about "Radiant City":

Genie Award-winning Radiant City offers an entertaining look at life in suburbia.

While Evan Moss zones out in commuter traffic, Ann toils away in her dream kitchen and the kids play sinister games amidst the fresh foundations of monster houses. Developers call it big business, but the Moss family call it home. Welcome to the neighbourhood and welcome to Radiant City - an entertaining and startling look at 21st century suburbanites and suburban sprawl.

When Sprawl Encroaches on Farmland...

...thanks to one of our readers who forwarded this interesting article discussing the many complex factors involved in sprawl and the effects on agricultural land:

It's quite tempting to sell off a farm in parcels for $20,000 an acre, sometimes much more if an entire farm is being developed. For most landowners, property rights are a priority; farmland preservation less so. As for someone who wants to cash out, it's rare to find anyone willing to leave money on the table.

But the evidence that urban sprawl is a problem continues to mount. Among the many considerations:

* More than 6 million acres—an area the size of Maryland—were taken out of agriculture and developed between 1992 and 1997, according to American Farmland Trust, an organization whose goal is to protect farmland.
* Within the next 32 years, this country will add 100 million people to its population, bringing the total to 400 million. How we use land in that growth will only become more of an issue.
* The argument that people have to live somewhere is easily countered by proof we are planning our spaces poorly. From 1982 to 1997, the U.S. population grew by 17%, but land development grew by 47%, according to American Farmland Trust. Since 1994, 55% of developed land went into 10-plus-acre lots.
* When the editor of this magazine asked readers about their biggest problems, the concern that outweighed all others was newcomers moving to the country.

Daily Sprawl Arrives Today at...

...this year's big CNU event in Austin, Texas.

While Daily Sprawl isn't going car-free this year, we will have some reviews of the walkability scene in Austin.

Look for the updates starting next Monday.

p.s. One thing we'll definitely be doing is joining the rest of the CityLoft Corporation team as they pick up their CNU Charter Award for the A&P Lofts.

Watching Wal-Mart Go Away...

Some people snicker when we suggest this but it is extremely likely that, within the next decade, Wal-Mart and its cheap oil-driven business model will not just slow down but, quite likely, go away.

After all, cheap goods at cheap prices only work if you can cheaply make and transport them. A fact that a Peak Energy marketplace will mercilessly punish.

Yet Another Story...

...on the growing number of potential exurban "ghost towns":

Peek behind the palm trees and there you see the most shocking sight: abandoned swimming pools, fetid and green, left to the elements and choked with algae. Thousands of people have walked away without even draining the water. Mosquito control agents now patrol these murky pools, treating them with pesticides to keep disease-carrying larvae from forming.
“With the skyrocketing foreclosure rate, the problem is compounding daily,” said Jared Dever, a spokesman for the government district that monitors insect breeding grounds. He said about 2,000 abandoned swimming pools would have to be treated in just one part of Riverside County.

Granted, the "ghost town" label is usually hyperbole, but the image of 2,000 abandoned homes and their backyard pools filling with stale water creates a pretty compelling Daily Sprawl picture.

Living in Sprawlanta...

This NPR story examines one Atlanta family and the monetary and time costs they've incurred since moving to Sprawlanta:

Outside metropolitan Atlanta, one of the nation's most congested cities, Michelle Carvalho's dreamhouse is 3,000 square feet. It has five bedrooms, a two-car garage and a big yard.

Her 16-month-old son's day care is 10 minutes away. But Carvalho's real commute, to her job as a cancer prevention researcher at Emory University, can take anywhere from an hour to an hour and a half, depending on traffic.

Meanwhile, this companion NPR story shows how another Atlanta family is living in a much more sustainable way:

The Taylors live in Atlantic Station, a new community in mid-town Atlanta designed to put jobs, homes and shopping all in one place, close to public transportation. Developments like Atlantic Station are springing up around the country, and proponents say they help cut car pollution, including the carbon dioxide that contributes to climate change.