Many Guyanese in New York have been hit hard by the US economic meltdown, losing homes, jobs and pensions due to bad mortgages and risky investments that did not pay off.
Faced with soaring food and gas prices, they are cutting back, making adjustments to their lifestyle, while trying to protect their dreams of a better life for their children. In Guyana, the impact of the financial crisis has not had a huge effect on remittances as yet, although it is believed that it will be felt soon. A local cambio dealer expects the slump in the US economy to be felt by the middle of next month. Now, she said, her business is experiencing just about a two to three percent decline in money transfers from the USA.
In 2000, a census found 130,496 Guyanese-born residents living in New York City. Licensed real estate broker and writer/artist Edgar Henry said the crisis has taken a heavy toll on Guyanese and other Caribbean nationals, particularly in the housing sector. He said a number of Guyanese who went into purchasing houses “were caught with their pants down.” He knows at least ten Guyanese who were affected to varying degrees on home purchases but he believes there may be many more. They were affected mainly on account of bad mortgages due to predatory lending which was unregulated and they have no choice but to walk away from their homes.
While the real estate business has been badly affected since people right now do not want to take chances, he said, “I am rolling with the punches.” He said that during the time of plenty he had invested in other businesses in which he is part owner and some of them were now proving worthwhile. “I will ride it out,” he said referring to the financial crisis.
As a real estate broker, he said that getting the best terms on a mortgage now requires a high credit score, a substantial down payment, full documentation and solid financial reserves. However if time is on one’s side, he said a purchase now could improve their position. “If you need a loan now and have less than stellar credit or a minimal down payment, ask your broker about mortgage insurance,” he said.
He added: “If you can’t make a mortgage payment, don’t be shy, call your lender. Banks and lending institutions do not want to own your home, and the sooner you call the more options they can offer to cure your problem”.
Henry said that no one can deny that times are tough due to the financial meltdown which has resulted in recent mergers, thousands of layoffs, the Merrill Lynch, Freddie Mac and Fannie Mae fiascos, coupled with the proposed government bailout of the world’s largest insurance company AIG. He expects that remittances to Guyana and barrels and packages sent to Guyana from New York would decline in the coming months.
America is struggling with soaring prices, mounting debt, a volatile stock market, housing woes, and fluctuation of fuel prices, he said adding that in spite of the gruesome economic situation and the terrible ricochet effect on every phase of daily lives “we still have to find ways and means to survive. It is imperative that we cut costs, retire when our nest egg has taken a hit, pay back student and car loans and at the same time avoid foreclosure.”
For a woman who asked to be identified only as Sonia, the crisis has meant becoming the sole breadwinner for her family. She left Guyana three years ago to join her husband and two children in New York. In the first year and a half after she arrived in Brooklyn, Sonia and her family lived in the basement of her in-laws. She worked at two jobs to help her husband “to pay down” on a house so that they could eventually move out. Her husband was forced to take early retirement so as not to lose out on some of his benefits. While that might have been good, Sonia said he has lost substantial money on investments he had for their children’s education. She did not say how much was substantial. For now, she is still holding down two jobs: as a clerical assistant during the day and as a caregiver in the evening. She and her husband have had to “give up” the house they had mortgaged in Queens and they are now back in her in-laws’ basement; a situation which she does not like. Sonia wants to come back to Guyana but her husband does not, she said. One good thing that has come out of the financial crisis, so far she said, was that he has stopped drinking. He now tries to be more understanding to her, since he has all his family in New York and she had no one but him and the children.
Suffered heavily
In a telephone interview with the Stabroek News, investment banker Carlyle Stewart said he has suffered heavily in the markets, losing about US$100,000 on an investment in equity. “For me, it is painful,” he said. The loss, he said may not be a big deal on the part of market volatility, but he called it a huge loss for him considering the impact on his future plans, including vacations, tuition fees for his children and his general lifestyle.
On the real estate front, he said everything was safe with him. But he feels those losing homes, especially in the Jamaica and Liberty areas were due to “very bad financial decisions because they do not understand the markets and financial strategies.” On Monday, he said a number of houses on one block in Queens – where a number of Guyanese and Caribbean nationals live – was boarded up. “They had just lost their homes or they had just walked away from them. They cannot meet the mortgage, which in some cases are less than the mortgage balance. They might as well give up. Real estate value has depreciated,” he said.
Stewart, who has worked with the investment bank Barclays Capital for over a decade in various capacities and is on the trading floor for fixed investment income, expected to make back some money when the situation gets stable but described it currently as discouraging. Losses were part of the risks on the stock markets, he said.
Via e-mail, Editor of the Caribbean Voice in New York Annan Boodram told the Stabroek News he has lost directly through his accounts. He also lost out US$8,000 from a college fund for his son. Boodram, who is also teacher, said his income has not been affected directly since his job was contractual. But with the cost of basic groceries and other consumables having gone up, he said: “We pay more for less and we have to restrict some purchases while eliminating others.”
To deal with the impact of the crisis, he said he was trying to exercise more caution over spending and is being more conservative, generally.
In New York, he said some Guyanese have lost homes, while some of their homes are in foreclosure; and some who rent homes are being scammed and find themselves being evicted.
“Some have lost money on their pension, retirement investments or commercial investments. They have to deal with higher prices. Some have lost jobs while others are struggling – those in real estate, travel financial investments for example. They travel less, entertain themselves less, are more cautious in spending, bargain hunt, buy less, etc.”
He also said some businesses owned by Guyanese, particularly in the Brooklyn area, are closing.
Trade union activist and teacher Chuck Mohan lost US$10,000 on his Individual Retirement Account and his 410K Savings Plan. A friend of his has lost US$46,000 on similar retirement plans. He is a teacher and does not expect to lose his job since his skills are more or less needed.
Well I hope that my fellow Guyanese are keeping up with the news and seeing what is going on in the world we are all suffering from the stock market crumbling things are hard everywhere just remember that sometimes we may not be in A position to help you guys with cash or A barrell just hold tight A little and see what you can do for yourselfs remember no honest work is degrading, just A thought stay strong my people things will change, Love.
Come back to Guyana…..thats what the president said when he was up for election in 2006.
Comming back to Guyana is a great idea, just don’t come back looking for a job with the Government. Bring money. Open a business, and employ at least two people. This is how to build a country.
Come back to what? You? There is nothing in Guyana to came back to.
……….hi sandhurst guyana is home……..however in the meantime while big jag and his boys put together an exit stratagy……i will table your call/cause for discussion with guyanese living in new jersey…….!!…….i have a whole lot there…….hold the front down me…….
the immigration feels like people does get freedom in america but share stress guyana my destination for the future
answering to the crises of ny.it is very sad , but as a guyanese you cannot give up. we always have a saying in gt eat and left bamby i will never give up the place of my birth guyana,ta ta,
That’s right, we are taking a beating here, everything is going up in smoke. I try not to lose sleep over it anymore, we have been shaped by a system, where we rely on a multinational corporation for all our needs, now they are all going belly up, and so are we.
That is why the people of Guyana, need to refocus on their direction and priorities. Outsourcing is one area that need to be looked into. However all of us cannot become a skilled rocket scientist, there are fewer and fewer jobs in the USA.
We may all have to seriously look back at Guyana. We are children of the forest-that may well become our only salvation. I am troubled by what I saw as Guyana’s attempt to urbanise the city and villages, we are turning away from the goods of the earth. America can no longer sustain an economy that is based on a fractional lending system, neither can Guyana, it has reached it’s mathematical limits worldwide.
Money just did not evaporate, most of it was simply transferred into the pockets of the mega and ultra rich.
In Guyana I saw that we are trying to develop a system based on western economic style. nothing wrong with that, but it can only go so far. All of us cannot own a fried chicken franchise, a balance of goods and services, has also got to be created at the village level, or we will continue to create a wider and wider seperation between the haves and have nots.
Now more than ever, we need to develop strong village economies. We desperately need to depend less on western technologies and goods.
I hate to keep repeating myself, but I see a renaissance in village life, by first teaching every villager, the use of rammed earth building techniques. It requires low skill, but is labour intensive, this will provide work for many villagers.
There is no limit to the creative possibilities of rammed earth. It is an art form in itself, limited only by the imagination. It will create jobs for many, irrespective of a trained skill. It will open the creative mind and talents of young people. After examining their beautiful, creative handiwork, they will conclude, why stop here, why not create a garden complete with a fence.
Now more that ever we need to get back to the old way of doing things, Guyana is perfect, I saw no problems, I saw only a lack of solutions.
Joe.
Welcome back Joe
Ah did miss yuh but right now ah not too much pun de net.
Good to read that you see and saw possibilities for Guyana.
What you think Burnham was saying and trying to do in his days?
Joe if you ever get the chance to read some of the old newspapers
of British Guiana you will see that much of the local application
to local resources was pushed by the colonistists but the locals
resisted!
So you think that would ever change?
Never my friend.
All things good come from ‘abroad’ including meltdowns!
Now with restricted remittances from the good US of A more
suffering will result in Guyana.
A large part of the reason for this meltdown in ‘uncertainty.’ Every now and then you catch a snippet of it in the news, but by and large, nobody talks about it. It has to do with investors who do not trust a possible Obama administration, who are pulling their money out of the stock market. The ‘Obama Slide,’ one analyst called it .
Remember those ’speculators’ who were blamed for unnecessarily driving up the price of oil? Same attitude. Except it’s more that mere fiscal uncertainty. It seems there are some who just cannot bear to have their money gainfully employed under an Obama administration. Sounds like home, right?
Yet, others not so mean spirited are set to triple and quadruple their investments. Warren Buffet, for one, is buying up everything he can find. I am no prophet. But I doubt America will ‘burn down its house to kill a rat.’ Watch for a new beast to emerge from this meltdown. And if what I see in the news is true, expect things to level out once this election is over.
Capitalism in its purest form is the fair exchange of goods or service for some kind of payment (capital). In other words, if a manufacturer produces a marketable product he goes out and finds a buyer for his goods. Similarly, if you preform a satisfactory service (work) then the client pays and that exchange is considered honest capitalism.
The problem here in the US, is that too many people are making a substantial living without producing any product or rendering any service. In most cases, there is no exchange just folks gaming off of each other, yet the community of these so called non-producing middle man millionaires are growing exponentially every year. In short we have too many people on this gravy train without the support of comparable manufacturing to augment the wealth gained. This is not raw capitalism, in fact, it’s more like unsustainable exploitation with a short shelf-life.
This economic collapse in the US was so predictable and a long time coming on account of the losses in the manufacturing sector to China and India. Stay tuned folks, because things will get much worse before they get any better.
JOHAN U BLAME OBAMA FOR THIS WOW ARE U FOR REAL
JOHAN DID U NOTICE THE COUNTRY OWES IN THE TRIILLIONS I WONDER WHAT U WOULD SAY NO THE DEBTS CAME BEFORE HE WAS EVEN A NOMINEE SO BE CAREFUL AND USE 1% OF YOUR BRAIN
Johan:::Be real and stop watching fix news ooops I mean Fox News…..
Johan,
I think you got this one wrong. It was wall street who provided most of Obama’s financing, and still continues to do so, I am trying to figure out what is their ultimate plan for doing so. Believe me my friends, we are not the ones that get to choose the next president, there are powerful invisible hands at work, who has already made that determination, the president bends to their wishes first, in his spare time, he may look back at us.
Joe.
i do understand what you mean to say,be careful your context are confusing that is why you are getting negative replies.i am in the stock market business,so i know what is going on………THE WALLS OF WALL STREET HAS FALLEN DOWN….in fact, the rate at which things were going, i know there would be a crash but i did not expect it for this year,.,…….
Yes, it is rough over here, one loosing employment or house dont feel so good, but we still have to carry on we just don’t give up. Hope the situation gets better soon.
Miranda,
Very informative and educational article. Do more of this stuff.
130,496 Guyanese live in NYC. Perhaps as many as 60,000 are citizens and registered voters. Do a follow-up and encourage them to vote on Nov. 4th.
The Republicans are mainly to blame for the financial meltdown. Starting w/ Reagan (80 -88), they gutted all sensible regulations. De-Regulation is their mantra. First the airlines -anyone can start an airline – so the undercapitaized airlines started to go bust. Then investment banks – they self-regulate. They packaged thousands of individual home mortgages and use them as collateral to issue bonds. Revenue from the sale of bonds were lent to a second round of borrowers (read subprime borrowers). Then it all went bust. And, the house of cards show, written and produced by the Investment bankers while the SEC slept began to crumble. The rating agencies rated the bonds AAA. Greenspan said the free market would right itself. Republicans believe in laissez-faire economics.
ABSENCE OF REGULATIONS PRODUCED THIS MESS.
I love your comments, well said Raj of Queens N.Y.
John McCain, voted 90% of the times for the Republican Party and
President George Bush “FAILED” policies Mcain also voted for
the war in Iraq, another dum decision.
We as Guyanese have and must vote for Sen, Barack Obama
on November 4th, then and only then we will see real change,
Sen Obama is the best person to fix the shredded economy of
this country.
In the month of August Sen Obama raised 66M dollars.
It was reported today, Sunday on CNN that he raised 150M
dollars in the month of September, my point is that he has the
ability to get things done.
HANG TIGHT AMEN-RA, IT’S ALMOST OVER. JUST LOOK ON THE OTHER SIDE AND YOU WILL SEE GREENER PASTURES.
As bad as things are in the world, not just America, I’d rather be in America right now than in Guyana. In America, there are economic assistance programs that can help the progressive-minded until they get back up on their feet. And if you are a Guyanese who lived through the Burnham years of hardships, adjusting and stretching food stuff or repairing rather than throwing away and buying new stuff, you will survive better than most who never endured such hardships.
But let’s be fair and also recognize that in the midst of the meltdown, there are Guyanese who are living the good life because they knew from past experiences to always prepare for ‘rainy days’! Stabroek News needs to talk with Guyanese who are not ‘down and out in New York City’ because of the hard times. Well, they may not want to come across as ‘braggadacious’, or expose themselves to predators, but that reality exists for many Guyanese right now. It’s not all doom and gloom!
Bob Marley sang: “In the abundance of water, the fool is thirsty.” That means the wise will ensure he knows where to find water! And there is ‘water’ (wealth) in New York City!
A bunch of Wall St. crooks along with both Government and Opposition ministers created this mess…Its called…Co-operate Greed…. the corporate fat cats ceo’s robbed you of a whopping 62b dollars last year…they have nice names for it..golden parachutes…Guyana had a 2.1b US debt and was declared a failed state…..the US national debt in the is 10trillion…you know this is bound to happen..every one and every country in the world will be affected by this…I asked before…which one of you ever got fired from your job and how much you walked away with?…you are fired from your job and you get $$0.00 but these CEO’s get fired and walk away with millions and millions…yet no one…no one sees it as “thiefing”…Talk about the corruption index in the US….where is the German now?
evileyes,
I am in your camp on this, it is corruption and theft of the higest magnitude, but it is being called every thing else but. Now whenever a low level mule is caught thru the airport with some drugs, only then does the German show up with his corruption index. He will serve society better by just relaxing with a frankfurter in one hand and a Becks in the other.
Joe.
If things get bad, take whatever money you have, and go back to Guyana. Even before this situation, I herd a lot of us were suffering out here. But our pride would not permit us to go back home. Guyana is not as bad, as some of us make it out to be. And when all is said and done it;s still home.
IF YOU SUFFER IN AMERICA YOU ARE STILL IN A COUNTRY, BUT IN GT WITH ALL THOSE OPPOSITION YOU ARE BOUND TO BE IN HELL A SECOND TIME.