Kelly Kearsley sent this in:

Snow, cold temperatures and a sluggish economy pushed Pierce County’s median home price down by 13 percent in December, according to figures released by the Northwest Multiple Listing Service Tuesday. That was the largest year-over-year monthly decline in 2008.

The end-of-the-year snowpocolypse didn’t help the already weakened real estate market as the weather kept buyers and agents from touring homes or even making it to work.

“I wasn’t seeing too many faces during the last half of the month and a lot of it had to do with the weather and it being too dangerous to drive,” said Dick Beeson, a NWMLS director and broker/owner of Windermere/Commencement Associates in Tacoma.

At $235,000, the median price for a single-family home or condo did perk up a bit from November when it was $230,000. The median home price in December of 2008 was $269,950. (Median means half of the homes sold for more and half sold for less.)

Pending sales in the county during December were down almost 14 percent and the number of homes and condos for sale decreased by 11 percent compared to the same month last year.

The latter is good news for home sellers.
“The (high) inventory levels have been one of the problems,” Beeson said. Too many houses for sale makes buyers nervous and tends to drive down prices.

Whether the county has hit the bottom of its price depreciation is anyone’s guess, though Beeson anticipates that the current low interest rates, new president and a promise of an economic stimulus from Congress will boost consumer confidence – and ultimately the real estate market.

Margo Hass Klein, an associate broker with Coldwell Banker Bain, said the buyers are out there – it’s getting the financing that’s tricky. Now Klein prepares her clients for finding financing before she starts showing them properties.

Still she is optimistic about 2009.

“I’ve already had four offers this year,” she said. “There’s still going to be a bit of a trickle down, but I’ve had nothing but good signs.”

Consumers are trying to squeeze more out of every dollar, so some Subway franchises in the Tacoma area are cutting the cost of everything on their menu.

The company announced Tuesday that participating franchises will reduce prices across the menu by an average of 8 percent to 12 percent.

“We appreciate our loyal customer base,” Seattle-Tacoma Marketing Board Chair Paul Armour said in a statement. “Our new menu-wide price reductions are designed to let our customers and all local consumers know that we care about them, and want to continue to provide healthy, delicious quick-service foods that are convenient and affordable to them.”

There are 359 Subway stores in the Seattle-Tacoma area.

The Internal Revenue Service feels your pain.

In a conference call this morning with reporters nationwide, IRS Commissioner Doug Shulman outlined a series of initiatives aimed at comforting taxpayers in troubled economic times.

“Over the next couple of weeks and the next several months, Americans are going to go through their annual ritual of citizenship,” Shulman said.

He acknowledged that in 2009, thanks to 2008, “citizens are facing some extraordinary challenges.”
For all taxpayers who will contact the agency this year, he said, “I’ve instructed all personnel at the IRS to be sensitive. Our people have been instructed to work with taxpayers (and) help them work through these difficult times.”

Shulman listed five steps that may help ease the travails of the 2009 tax season:
• IRS employees have been given greater authority to suspend collections in certain hardship cases – job loss, severe illness, limited Social Security or welfare income – where taxpayers are unable to pay.
• “We’re going to be more flexible with taxpayers who have an existing installment agreement,” Shulman said. If a taxpayer has been compliant in making payments, and faces financial hardship, the agency may allow a skipped payment or a reduced monthly payment.
• The agency may review home values used to calculate “Offers in Compromise,” which reduce the amount of taxes owed. (Incidentally, the latest available figures, from 2007, show 46,000 offers received by the IRS, with 12,000 accepted for a total value of $228.9 million. All figures were lower than recorded in 2005 and 2006.)
• New options for people who might otherwise default on an Offer in Compromise.
• The agency will speed the delivery of levy releases – a levy resembles a wage garnishment – by easing requirements facing taxpayers who request an expedited release.

But don’t think these actions signal an IRS that has taken to singing lullabies. The agency remains in the business of assessing and collecting taxes.
“If someone just doesn’t pay their taxes, doesn’t file – they’re going to end up in trouble,” Shulman warned.

He also outlined two other initiatives – a new section of “What if?” scenarios at the agency Web site, www.irs.gov, and an expansion of the Free File program at the site – that could also help taxpayers in “difficult economic times.”

His message to taxpayers with questions or concerns: “Pick up the phone and talk to us.”
“We’re going to work with taxpayers who have legitimate needs,” he said.

However (and you knew there was a “however” in this story), "This isn’t a free ride,” Shulman said. “People who can pay still need to pay their taxes.”

He cautioned, “The IRS will enforce the law and people need to pay their taxes.” He expects a “vast majority” of taxpayers will be able to pay their due. For for a minority “who find themselves in difficulty and need flexibility, we’re going to give it to them,” he said.

The number to call, if you’ve got questions for the IRS, is 1-800-829-1040.

And April 15 remains the date your taxes are due.

British Columbia terminal operators are reportedly studying a new contract proposal from the Longshore union that could end the threat of a strike at Canadian ports.

That proposal was drafted over the weekend in marathon talks between the union and waterfront employers.

The dock foremen had threatened to strike last Friday, but the new proposal puts off that possibility until at least Jan. 12.

If the foremen strike, other International Longshore Workers Union members could halt work both in Vancouver and Prince Rupert, halting all but grain traffic through the two ports.

The Canadian government considers grain shipments essential and has prohibited work stoppages at those terminals.

Alaska Airlines today reported its December traffic was down 5.2 percent but its planes were nearly five percentage points fuller than last year.

That's because that while fewer passengers flew fewer miles last month than in December 2007, the airline had reduced its capacity by a greater amount, 10.9 percent.

Alaska's regional brother airline, Horizon Air, reported 21.5 percent fewer revenue passenger miles (one passenger paying to fly one mile) last month than in the same month in 2007. The airline, like Alaska, had reduced capacity by a larger amount (21.8 percent) yielding slightly fuller flights.

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Connie Brown, executive director of the Tacoma Pierce County Affordable Housing Consortium, writes to ask about all that money we've been hearing about.

"Maybe I’ve missed the discussion on this, but where is all the money now that’s been lost in the last year or so by individuals, businesses, banks, etc? I have a short list of theories, but I think it’s worth an analysis that we can all understand. My list: big oil companies, Haliburton/Blackwater, dictators of resource-rich countries, large investors on the sidelines."

Good question, Connie. I'll open this up to readers, to see if anyone has a view one way or the other. (Readers: Please comment if you've got the answer.)

Here's my take:

There never was any money. Let me illustrate with a puzzle. Three guys go into a bar and order a big, special drink. It’s 6 p.m. The day-shift bartender makes the drink and charges the group $30. Each guy gives him a $10 bill. The guys are at their table drinking when the night-shift bartender comes over and asks how much they paid for the drink. They tell him. He walks back behind the bar feeling bad. He knows that the drink should have cost $25, and that the earlier bartender was overcharging.

Calling the waitress over, the night bartender gives her five $1 bills and tells her to return the money to the table with the three guys. Walking to the table, she has trouble figuring how to split $5 three ways, so she ends up giving each guy a buck and she pockets $2 for herself.

How much did each guy pay? Nine bucks. What’s three times nine? Twenty-seven. Add the $2 the waitress kept, and that equals $29.

So what happened to the other dollar?

Where’s the money?

Got a gift card from KB Toys? Use it or lose it.

The Washington Attorney General’s office says this week that the company has given notification that it is liquidating its stores and will not accept gift cards or store credit after Sunday, Jan 11.

The AG says KB Toys stores and KB Toys.com operate as separate businesses, and gift cards purchased from stores cannot be spent online, according to a notice on the KBToys.com site.

KB Toys has three stores in Washington, in Centralia, North Bend and Vancouver.

Gift cards bought from KBToys.com can be replaced with an electronic gift certificate that can be used for online purchases, according to this notice http://www.kbtoys.com/help/KBgiftcardemail.html. The site doesn’t specify when those certificates expire. KBToys.com is a subsidiary of The Parent Company, which also filed for Chapter 11 bankruptcy, the office says.

Under Washington’s gift card law gift cards and gift certificates sold by retailers generally never expire or carry expensive maintenance fees. If a company files for bankruptcy, however, it’s up to the court to decide which financial obligations are honored.