BUBBLE TALK: Old thread

May 07, 2006

BUBBLE TALK: Old thread

Have at it

139 comments:

Smart Grid blogger said...: Read: Toms River, NJ schools hold tax rate hike; March 30, 2006 4:16 PM
Smart Grid blogger said...: Bloomberg News: U.S. Treasuries Decline, Pushing 10-Year Yields to Highest in 21 Months

March 30, 2006; March 30, 2006 4:29 PM
Smart Grid blogger said...: Fed raises rates and may hike again

remember that the FED is fighting economic Inflationary pressures and is not going to save the bursting of the Housing Bubble...imho; March 30, 2006 5:23 PM
Smart Grid blogger said...: Rates on 30-Year Mortgages Rise
Thursday March 30, 4:09 pm ET
By Martin Crutsinger, AP Economics Writer
Rates on 30-Year Mortgages Rise After Federal Reserve Pushes Key Short-Term Rate Higher

WASHINGTON (AP) -- Rates on 30-year mortgages rose this week after the Federal Reserve pushed a key short-term rate up for the 15th time and indicated that more rate increases were possible.
Mortgage giant Freddie Mac reported Thursday that rates on 30-year, fixed-rate mortgages averaged 6.35 percent this week, up from 6.32 percent last week.

The increase pushed rates to the highest level since they hit a 2 1/2-year high of 6.37 percent the week of March 9.

Analysts attributed the increase to the Fed's decision on Tuesday to raise the federal funds rate, the interest that banks charge each other, to a five-year high of 4.75 percent while indicating that further rate hikes were possible.

"The market was a little surprised at the (Fed's) comments which implied more tightening in the future," said Frank Nothaft, chief economist for Freddie Mac.

"That raised the expectation that inflation may be more of a threat than was previously thought, and that kind of thinking promotes upward pressure on mortgage rates like we saw across the board this week," Nothaft said.

Rising mortgage rates are expected to cool off the extended boom in housing that saw sales of both new and existing homes set records for five consecutive years. Analysts are looking for sales to drop by around 6 percent this year.

Rates on 15-year, fixed-rate mortgages, a popular choice for refinancing a home mortgage, averaged 6.00 percent this week, up from 5.97 percent last week.

One-year adjustable rate mortgages rose to 5.51 percent, up from 5.41 percent last week.

Rates on five-year hybrid adjustable rate mortgages also rose, climbing to 6.02 percent, up from 5.96 percent last week.

The mortgage rates do not include add-on fees known as points. The 30-year and 15-year mortgages carried an average nationwide fee of 0.5 point while the one-year ARM had a fee of 0.8 point and the five-year ARM carried an average fee of 0.6 point.

A year ago, 30-year mortgages averaged 6.04 percent, 15-year mortgages stood at 5.58 percent, one-year adjustable-rate mortgages were at 4.33 percent and five-year hybrid adjustable rate mortgages averaged 5.43 percent.

FROM: http://biz.yahoo.com/ap/060330/mortgage_rates.html?.v=2; March 31, 2006 6:15 AM
Smart Grid blogger said...: CNNMONEY.COM: Inflation fears punish Dow
Blue-chip average sinks as Treasury bond yields hit 22-month high, oil prices rise, but Nasdaq composite bucks the trend.; March 31, 2006 8:15 AM
Dogcrap Green said...: I'm out of here

Will check back in a month to see if Kieth (the foreingner in London stealing their work) is still pissing and moaning abt his raciest views on Mexicans; March 31, 2006 12:39 PM
Smart Grid blogger said...: read this great rticle: The Fed Officially Kicks Off the Next Recession
by Robert McHugh; March 31, 2006 4:52 PM
Anonymous said...: dogcrap green - Keith is racist, not "raciest"; April 01, 2006 7:36 PM
Anonymous said...: You bubbleheads on these blogs are so depressing! If everyone listened to you guys....the world would come to an end. Thank God for realistic people that can think clearly for themselves and not listen to the non-sense you all talk about!!

"Oh No! The real estate market has come to a halt. Prices will drop. Payments will go up. Realtors will be jobless. Sellers will lose money..etc, etc, etc...." Give me a break!!

The market is correcting itself. Things are picking back up. People's payments are going up because people make STUPID choices as far as the loans they picked!! Realtors will never be jobless. Prices will go down for a short period, but over the long haul....they will continue to rise and people will continue to gain equity in their homes.

Soon, this will all pass and you will have nothing else to talk about.....LOL; April 01, 2006 8:02 PM
blogger said...: nice to see david lereah from the NAR posting! welcome aboard!; April 01, 2006 9:38 PM
Smart Grid blogger said...: Read:

The Weekly Standard: Housing Bubble Trouble
Have we been living beyond our means?

by Andrew Laperriere
04/10/2006, Volume 011, Issue 28

"If something can't go on forever, it won't."
--Herb Stein; April 01, 2006 9:59 PM
Anonymous said...: From the article above:

"The National Association of Realtors recently produced an analysis of about 100 different metropolitan areas and found prices justified in every one. The NAR concludes it would practically take a depression for home values to drop 5 percent."

Hmm. I suppose too, if we polled busboys and bag carriers, we would learn that 100% of their tips are reported to the IRS.; April 01, 2006 10:56 PM
Anonymous said...: Take a look at this chart for San Diego county foreclosure stats. Graphic interpretation, of a looming housing crisis.

http://tinyurl.com/zlvc2

There really is no doubt, that the carnage to people's equity will rival or exceed the 1990s bust.; April 02, 2006 1:49 AM
Anonymous said...: mummy? I'm scared.; April 02, 2006 6:19 AM
Anonymous said...: HOSPITAL JOBS in New Jersey supporting Housing Bubble in North Dover, Toms River, NJ 08755 will be affected too...imho !!!

read: TRENTON,NJ: Suburban hospitals could lose millions

ZILLOW.com North Dover, Toms River, NJ 08753 for Home Prices around the Community Hosiptals; April 02, 2006 7:47 AM
Anonymous said...: Regarding what Ian Toll said at the top of this page...

If you or anyone else who's a renter gets hassled by a landlord, simply send (anonymously) them a used copy of the movie Pacific Heights about the renter from HELL. It will make any landlord think long and hard about hassling a tenant : ); April 02, 2006 4:04 PM
Anonymous said...: dogcrap green - Keith is racist, not "raciest"

Consult Webster. He is a bigot.; April 02, 2006 11:00 PM
Dave Barnes said...: Nice chart at http://bwnt.businessweek.com/housing/2006/index.asp; April 02, 2006 11:17 PM
Anonymous said...: I wonder if they'll be having "foreclosure parties" like they had all those condo opener parties?; April 03, 2006 12:25 PM
Anonymous said...: I started thinking about buying a condo in Destin, Florida last July after a visit. I already own a vacation rental cabin in North Georgia (cash flow positive) and wanted to add a beach condo as a second vacation rental property.

I had heard from many sources a year ago a prediction of a bubble in some areas and I think the Florida gulf coast (particularly the Destin area) was in a major bubble. Big concern is, the rental rates aren't near enough to compensate for the mortgage, taxes and association fees. Near as I can tell, even keeping the thing rented virutally full time would still end up costing me about $1000 - $1500 per month, which wouldn't kill me but just doesn't taste very good if you know what I mean.

I have started to see condos in the complex I'm interested in start to stay on the market much longer and have not seen prices increasing over the last year. But I haven't seen prices coming down in this complex, although I have seen some huge price decreases in a few other complexes here and there on individual units. I just saw one sell for $435,000 with the two units on both sides with exactly the same dimensions listed at $575,000. I found that quite incredible. I'm hoping the bubble goes ahead and completely deflates as soon as possible and I'm hoping to find what I want in the complex I want for around $300,000 - $350,000 or even less rather than $450,000 to $475,000.

I am soliciting educated opinions of the future of condo prices in the Destin area? What is the thinking these days: wait 6 months, 12 months, 24 months? I know I want to buy one but I want to be smart and patient.; April 03, 2006 1:39 PM
blogger said...: dwilliams - wait until the unit is cash-flow positive rent vs own.

period.

it'll get there. they always do.; April 03, 2006 3:26 PM
Anonymous said...: Where are statistics for unsold homes nationwide?

Interesting that new home construction hit a record pace (maybe warm weather related) in Feb., but last week they announced new home sales were DOWN. Doesn't this imply new homes stacking up like cordwood?

I wonder if Bernake will stop raising rates for a while to let the increase in rates sink into the economy. If he does, the markets will explode upward.

But longer term I think housing will have an extended downturn and bring alot of other industries with it.; April 03, 2006 4:01 PM
Anonymous said...: Have A Look.
http://www.321gold.com/editorials/daughty/daughty032906.html; April 03, 2006 7:32 PM
Anonymous said...: Question: Do I feel sorry for all the real estate bag holders?

Answer: My wife ran away and married my best friend, I miss him very much.; April 05, 2006 3:07 AM
Anonymous said...: 93 Percent of Lenders Predict Housing Prices Will Drop 10 - 20 Percent.

Why do they have such loose lending standards? Is it because they know Uncle Freddie or Aunt Fannie will by the junk loan off them? How long until Freddie and/or Fannie fail resulting in a HUGE government bail out?

http://biz.yahoo.com/bw/060404/20060404005995.html?.v=1; April 05, 2006 3:35 AM
Anonymous said...: Check out the latest PMI report on under/overpriced MSAs.; April 05, 2006 5:38 PM
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-------------
Another troller using this forum to push something. Maybe Kiyosaki is trying to rake in some more nickles and dimes, so he can keep renting bling to make idiots believe he's rich.; April 05, 2006 7:08 PM
blogger said...: uk - post here in bubbletalk, but know that I get sent emails from many users with the same articles - especially the big hot ones. I also get news feeds and google pushes too, so usually got it covered - but post here to make sure; April 05, 2006 10:38 PM
Anonymous said...: 40% of home sales are second homes bought by baby boomers. that greedy materialistic generation is going to blow its savings on over-priced real estate and demand the government bail them out.; April 06, 2006 2:58 AM
Anonymous said...: i need some illegal aliens to raise my children and mow my lawn. lord knows i'm too good to raise my own children or take care of my home. i would rather spend my time at starbucks talking about how some people don't take care of their own children.

i don't want to pay fair wages to an american citizen or legal alien. illegals don't complain, you can pay them slave wages, and you can throw them to the curb if they ever get hurt. by the way, don't you just hate how walmart treats its employees?; April 06, 2006 3:05 AM
Anonymous said...: good news all:

A wacky left coast federal judge in California has ordered the city of Los Angeles to pay the relatives of gangster rapper Christopher Wallace over $1 million (aka Notorious B.I.G., aka Biggie Smalls) for misconduct and other irregularities regarding his murder. Wallace was murdered in a drive-by shooting after a hip-hop party in Los Angeles in 1997. It is believed that the murder was in retaliation for the shooting death of rapper Tupac Shakur in Las Vegas in 1996. Wallace's relatives claim that the LAPD is responsible for the murder. The city does not plan to file an appeal.

Isn't it wonderful how the government is spending the taxpayers' money?; April 06, 2006 4:54 AM
The Thinker said...: Here in the NYC metro area, it seems as though housing is picking up some. Is anyone here starting to think that just maybe this bubble has a year or two of life left in it?; April 06, 2006 2:00 PM
Anonymous said...: "The Thinker said...
Here in the NYC metro area, it seems as though housing is picking up some. Is anyone here starting to think that just maybe this bubble has a year or two of life left in it?"

Yes it does, a good solid year at least. I think that construction will hit an all time high in 2006. The increased inventory and lower, (but still very profitable for the sellers,) housing prices will draw out those hesitant homebuyers who have been sitting on the fence waiting to jump in.
Rates are still lower now then when I bought my house in 1988.
Couldn't ask for a better time to buy(buy sensibly that is.); April 06, 2006 2:55 PM
Smart Grid blogger said...: Inflation concerns push mortgage rates higher

Thursday April 6, 1:07 pm ET

Mortgage rates remain relatively low, but they've been rising in recent months, a trend that continued this week.
Freddie Mac's weekly report says the average 30-year fixed-rate mortgage rose to 6.43 percent, up from last week's 6.35 percent average.

Long-term mortgage rates are about a half percentage point higher than a year ago. One-year adjustable-rate mortgage reached 5.57 percent this week, about one and a half percentage points higher than one-year ARMs were averaging this time last year.

"There is concern that the continued high level of energy cost may lead to inflation in other sectors of the economy," says Freddie Mac (NYSE: FRE - News) chief economist Frank Nothaft. "And fear of inflation leads to higher mortgage rates, like the ones we see this week.

A report earlier this week from the Mortgage Bankers Association showed mortgage applications last week rose the most in two months. Refinancing also rose, although the refinancing activity is now about half what it was a year ago.

Published April 6, 2006 by the Washington Business Journal; April 06, 2006 7:03 PM
Anonymous said...: Proof that the bust has officially started. Hollis Lynch of Henderson, NV recently filed a trademark for " WILL SELL REAL ESTATE FOR FOOD". It's verifiable at uspto.gov; April 07, 2006 3:45 AM
Anonymous said...: Median price of a house in Seattle more than $400,000

--Pending home sales in Seattle and King County fell again in March, while home prices continued to climb. Real estate experts said the declining sales shouldn't be cause for concern and likely reflect a "normalizing" of the market after many years of strong sales.

The median price of a King County house climbed in March to $365,000, a 12.3 percent jump from the same month last year, according to a report issued Thursday by the Northwest Multiple Listing Service.

But pending sales countywide fell 8 percent compared with the same period a year ago.

The same trend held true in Seattle, with pending sales down 8.8 percent and the median home price climbing nearly 15 percent, from $355,000 a year ago to $407,000 in March.

http://seattlepi.nwsource.com/business/265860_homesales07.html

I've been trying for over a year to buy my first property in Seattle. I'm officially waving the white flag.; April 07, 2006 5:03 PM
Anonymous said...: good luck in seattle......while pending home sales dropped for the month of March, inventory has actually gotten tighter when looking at inventory over the past 6 months and year.......

the current job growth in that area and forecasts through 2010 make it a tough area to afford right now......seattle pricing is not going down anytime soon; April 07, 2006 6:29 PM
Anonymous said...: Depending on why your moving nd to where - another apt? to a home ? I would just live out the security, I do not wait for them to nit pick everything.; April 08, 2006 5:05 AM
Anonymous said...: tug of war continues... cited from a realtor website:

A comment pertaining to the current market, "Most Sellers are ONLY remembering the previous market when Listing their home or condo For Sale but the Buyers know Today's New Market"... Especially, with Today's ever increasing inventory!

http://realtytimes.com/rtmcrcond/Massachusetts~Newton~nickrioux; April 08, 2006 11:13 PM
dcbubble.blogspot said...: personally I dont think the housing bubble is a national story

its a regional story about place like phoenix, miami etc.

in dc, not metro washington, i see prices stablizing. sure they are off their peaks, but not plummet. way outside the beltway i think prices will drop. no reason to pay big bucks in centerville.

www.dcbubble.blogspot.com; April 09, 2006 2:29 AM
Anonymous said...: Hey there's a Communist idiot in one of the threads claiming that North Korea is actually capitalist and Western Europe is Communist. LMAO; April 09, 2006 3:52 AM
Anonymous said...: My Uncle just came back from the east coast of Florida. He can't belive how many houses are for sale there. The prices he said are very high. I see the same here in westchester New York. For sale signs are everywhere. The inventory is exploding!! The next few months will be interesting. I guess all of the housing bubble articles are true, the for sale signs convinced me..; April 09, 2006 2:05 PM
Anonymous said...: "4 teens arrested in death of NYU student

Cops arrested four teens suspected of killing an NYU student by chasing him into the path of a car in Harlem as they shouted, "Get the white boy!"
Two of the suspects accused of terrorizing John Broderick Hehman were only 13 years old. The other suspects, Hassan Mayfield and Andre Johnson, are both 15, police said.

Chatting on a cell phone on his way to visit a buddy, Hehman was confronted outside a Popeye's fast-food joint at E. 125th St. and Park Ave. at 8:30 p.m. on April 1, sources said. "I'm almost there," he told the pal before the line went dead, sources said.

After Hehman, 20, handed a wheelchair-bound homeless man a dollar bill, one of his attackers allegedly asked him, "What about us? Where's our dollar?" police sources have said.

Terrified, Hehman raced into the middle of the intersection where he was rammed by a silver Mercedes. He died at Harlem Hospital four days later.

Homicide detectives and investigators from the NYPD Hate Crimes Task Force had scoured the East Harlem neighborhood looking for members of a roving gang believed to be responsible for Hehman's death and menacing businesses.

Mayfield and Johnson were both charged with second-degree murder and attempted robbery late yesterday.

Charges were still pending for the 13-year-olds suspected of causing Hehman's. death.

The attack recalled the infamous Howard Beach case in 1986 when a group of racist white thugs chased a black man onto the Belt Parkway where he was struck and killed by a car."

That's something you won't see CNN and the alphabet newschannels report on - if it was a group of whites who chased a black man then it would be on CNN 24x7 for the next 3 weeks

http://www.nydailynews.com/news/crime_file/story/407249p-344783c.html; April 09, 2006 4:04 PM
Anonymous said...: I agree with what Anon said about the guy chased to his death by those in a "protected class". Traditional news sources are worse than bad. They're outright dangerous. It's outrageous, getting worse and is why sites like Wnd.com, DrudgeReport.com and NewMax.com are so popular.; April 09, 2006 11:33 PM
Anonymous said...: re Seattle:

Price reductions are happening all the time in Seattle.

In Jan., 10-15% of the MLS was price-reduced. By Feb., 20% was price reduced. In March it was 30%.

Do not kid yourself, prices are dropping in Seattle.

The economy of the area is NOT strong enough to support the high prices. If it was, Seattleites would not have needed to use almost 70% "creative" loans to buy last year.

Stop listening to lying realtors and lying NAR economist Lawrence Yun about the Seattle market.

You are responsible for your own financial well being. They will not tell you the truth.

Buyer be ware. Take control of your life and do your own research on the Seattle market before buying there.

If you fail to do your own research before buying,you've got no one but yourself to blame when you find out you've been had and your property is worth less next year than what you purchased it for this year.; April 10, 2006 2:35 AM
Anonymous said...: please read:

Homebuyers feel pinch of rising rates
Consumers squeezed as adjustable-rate mortgages expire

Updated: 5:26 p.m. ET April 9, 2006; April 10, 2006 7:57 AM
Anonymous said...: Two more months of the same trend in housing we have seen since November and the bubble will be as undeniable as the fact that we have a complete idiot for president. The dominoes will all start falling ,,, Republicans out of congress, the religious right back under their rock and then ... corporate american out of our lives.; April 11, 2006 8:07 AM
Anonymous said...: The Libtards keep bidding up the home prices in Californicate and Taxachussetts and it's all the Bush's fault. Never blame anyone for their actions. Only a right-wing nut would do that. It is always somebody's else's fault.; April 11, 2006 7:49 PM
Anonymous said...: Concerned in Seattle said:

Price reductions are happening all the time in Seattle.

In Jan., 10-15% of the MLS was price-reduced. By Feb., 20% was price reduced. In March it was 30%.

What are you looking at? The link that Keith always provides shows that Seattle prices went up 2.4% last month, 6.3% the past three months, and almost 8% in the last six months......doesn't look like a price reduction to me.

http://www.benengebreth.org/housingtracker/
location/Washington/Seattle/

Also....Seattle inventory is down 17% since 6 months ago! It does not look like it is going to get any easier to buy in Seattle any time soon,,,,,,; April 12, 2006 2:19 AM
Anonymous said...: "Dogcrap Green said...
I'm out of here"
Please don't return..; April 12, 2006 4:41 AM
Anonymous said...: News for Realtors Looking for Work

Posted on this site:

http://newspundit.net

Have a great laugh. This message was offered for homor only and was intended to be understood as satire.; April 12, 2006 5:04 AM
dcbubble.blogspot said...: Condo prices in DC are going down, but single family house prices are going up. DC Bubble has talked about this trend before, and below are statistics from the Greater Capital Area Association of Realtors illustrate the trend.

http://dcbubble.blogspot.com/2006/04/incredible-bifurcating-market-condo.html; April 12, 2006 3:07 PM
Anonymous said...: LOW MORTGAGE RATES were just history now !!!!

read: Interest rates near four-year high; home loans fall 5.5%; April 12, 2006 5:26 PM
Anonymous said...: I've seen far too many landlords who do try to take advantage and keep security deposits for normal wear and tear. That is definitely an abuse and should not be tolerated. On the other hand, I have seen just as many renters who try arguing to get their entire deposit back even though they have painted the rooms wild colors which will need to be covered (even when the lease specifically stated "no painting"), tenants who let their pets (which were also not allowed) tear holes in the carpet and then don't understand why they're responsible for replacement, etc.

The thing that gets me the most about these negative cash-flow landlords has nothing to do with the security deposit--it has to do with them trying to get rid of their property and make a huge profit. Some of them think, "Oh, well, it's twelve units so I should get $600K for it!" and don't understand that a smarter investor pays for property according to how much it makes, not how big it is. Whenever I hear, "Oh, it could make money--the rents are just low, they could be much higher!" I just want to ask them, "Well, then, why the heck haven't YOU raised them?"; April 12, 2006 9:47 PM
Anonymous said...: The gray area with the security deposit is with older units or houses that have significant wear and tear at the beginning of a lease. At the end of a lease, the landlord may feel he needs to replace the carpets or repaint and charge the full cost to the tenant. So the commplete cost of a renovation or upgrade that would have been necessary anyway falls on the tenant. When landlords are bleeding cash, the temptation to shift the entire cost on the most recent tenant is very strong. So renters should take lots of photos and attach addendums to the lease specifying the condition of a property at the outset, to guard against landlord abuse at the end of the term.; April 13, 2006 2:50 AM
Anonymous said...: Thanks for standing up for me...I always knew I was a great person...but why am I so reviled?; April 13, 2006 1:03 PM
Anonymous said...: Rosie, he's just jealous because you've had more women than he'll ever have, since he spends all his time sitting there in his mother's basement, stuffing his pudgy face with Cheez Curls and posting hateful stuff on discussion boards.; April 13, 2006 2:57 PM
Anonymous said...: Today the 10 yr yield closed above 5% and I sung a little tune to celebrate the end of Realtor(TM)s:

(Sung to the tune of Pop Goes the Weasel)

No more six percent
Now it's maybe two--ooo
round and round the neighborhood
open house now seven days
Pop Goes the 10 Year!

Inventory builds and builds
Flippers dump everything
Condos come on day by day
Mortgage bankers laying off
Pop Goes the Profit!; April 13, 2006 9:12 PM
Anonymous said...: Hey, concerned is wrong-

actually "Concerned" is correct.

If you scroll down to the bottom of the benengebreth site, you'll see that he bases his graphs on ASKING price.

If you go to http://www5.metrokc.gov/reports/property_report.asp

You can find the actual "sold" price (albeit a couple months late).

I did this with an MLS list from Ravenna/Laurelhurst a month or so back and was astounded to find that 40 out of the 57 properties that had sold went UNDER asking- by anywhere from 200K-5K.

That's when I knew Seattle was turning. Only 8 of the 57 had been bidded up.

The complete list is on the Seattle Bubble site somewhere (in March I think).; April 13, 2006 9:51 PM
Anonymous said...: BTW-

Also re Seatle:

According to the Seattle Times last Sunday, YOY median price is finally beginning to fall in Seattle.

It fell in 3 of about 30 sections that they track.

In one section the median fell 30%!!

The other 2 sections were more modest (-4.1 and -0.2) but hey, it's a start!; April 13, 2006 9:58 PM
Anonymous said...: Here is my musical contribution, in honor of the 10 year note rising above 5%:

(Sung to the tune of "london bridges falling down")

Interest rates are going up
Going up, going up
ARMs/INT-onlies going up
Can you say "we're hosed"?

Your commission's going down,
Going down, going down
Silly realtor, get a job
Burger King is hiring!

No more stinking seminars
get rich quick, get rich quick
bankruptcy it beckons thee
my fair flipper; April 13, 2006 10:27 PM
an_dochasach said...: An energy efficiency consultant pointed out another downside to this global bubble. Builders are erecting thousands of energy inefficient homes all over the world because panicky buyers and speculators are buying them with little regard for quality or efficiency.

When oil is $120/barrel it will become terribly obvious that 1970-2006 construction was as inefficient as my 1972 Buick. Unfortunately, unlike Buicks, we will be stuck with guzzler houses for a very long time.; April 13, 2006 11:39 PM
Anonymous said...: Are we going to see people in these massive McMansions all over the country, not able to fully heat their houses.

Now, mortgage poor would mean too poor to buy heat, along with furniture.

http://www.AmericanInventorSpot.com
AmericanInventorSpot.com; April 14, 2006 2:23 AM
Anonymous said...: so in seattle, 27 of 30 areas went up in price, and 3 went down??

does not look like an ideal place to get a cheap house; April 14, 2006 4:43 AM
Anonymous said...: http://www.pbs.org/newshour/bb/economy/jan-june06/biofuels_4-13.html

sigh, i didn't hear it wrong last night...here it is:

CO-2, of course, is the primary greenhouse gas, whose concentrations in the atmosphere, after holding steady for thousands of years, are rising at what the great majority of climate scientists now warn is an ominously accelerating rate. The problem is that atmospheric CO-2 seems to act like a blanket, trapping heat, warming up the world.

WALLACE BROECKER, Columbia University: People are going to look back in 200 or 300 years and say, "Those idiots back there, they could see that, by adding all this CO-2, they were going to make some horrendous changes on the planet. And, yet, and they also realized that they could avoid it by a reasonably small cost. Why didn't they do it?"

PAUL SOLMAN: Columbia University scientist Wally Broecker isn't just talking about any idiots; he might even be talking about you and me.

WALLACE BROECKER: Every time you drive a standard American or Japanese car one mile, you release from your tailpipe one pound of CO-2. So if you drive your car 20,000 miles in a year, you produce 20,000 pounds of CO-2.

-Di; April 14, 2006 12:24 PM
Anonymous said...: When oil is $120/barrel it will become terribly obvious that 1970-2006 construction was as inefficient as my 1972 Buick. Unfortunately, unlike Buicks, we will be stuck with guzzler houses for a very long time.

Exactly....whenever I look at a house I want to know the SEER/Efficiency ratings of the HVAC and Water heater. Every subdivision I've visited has the absolute minimum....80% efficiency gas appliances.

The cost difference between min and max efficiency isn't that much and the cost savings over the life of the house is huge. Many utilities offer rebates to subsidize the cost of energy efficient appliances.

After encouraging my friend to get the builder of his subdivision house to upgrade the appliances the builder said "NO". Of course they get good deals on the crappy stuff.; April 14, 2006 3:48 PM
Anonymous said...: TOMS RIVER, NEW JERSEY 08755

Here comes the revaluation, Dover

Home visits may start in June
Posted by the Asbury Park Press on 04/14/06
BY JEAN MIKLE
TOMS RIVER BUREAU

DOVER TOWNSHIP — Field visits to homes could begin by June as the township starts its revaluation process.

The Township Council Tuesday introduced an ordinance to bond $2.5 million for the revaluation, much less than the initial estimates of $3.5 million to $4 million to complete the work.

State law allows municipalities to bond for the cost of revaluations, spreading payments over a five-year period.

The council is expected to adopt the bond ordinance at its April 25 meeting, and Tax Assessor Glenn Seelhorst said Dover will then sign a contract with Certified Valuations Inc., the Randolph firm that was the low bidder for the revaluation work.

"We had anticipated having to pay up to $4 million," Council President Gregory P. McGuckin said. "We went out to bid and the bids came back lower than we had anticipated."

Seelhorst said that once the contract is signed, it must be approved by the state Division of Taxation before work can start. Certified Valuations Inc. recently completed a revaluation of Newark, the state's largest city. It is a large firm with enough field inspectors and other employees to handle the Dover revaluation, Seelhorst said.

The company will open an office in downtown Toms River within 30 days of the state's approval of the contract, he said.

Dover has the most taxable single-family residential properties in the state, Seelhorst has said, with about 38,000 residential taxable parcels.

The Ocean County Board of Taxation has given the township until Oct. 1, 2007, to complete the revaluation work. That means the new property values will be in effect for the 2008 tax year.

A revaluation is normally ordered when the assessed value of properties in a town falls below 70 percent of market value.

In a letter sent in February 2004 to Brush, Ocean County Tax Administrator Barbara Raney said residential properties in Dover were estimated to be assessed at 51.2 percent of their true value, while commercial, industrial and apartment properties were assessed at about 63 percent of true value.

Vacant land was assessed at about 58 percent of true value, Raney said.

Seelhorst said the township's last revaluation was conducted in 1993, when property values were depressed.

Revaluations are normally ordered to ensure that all property owners are paying their fair share of taxes. Assessed property values typically rise significantly in a revaluation, but not all homeowners would pay more in property taxes.

Property taxes may decline in certain areas of town, especially those where property values have increased more slowly than in other sections.

The barrier island and other waterfront areas of town are expected to see dramatic increases in property values as a result of the revaluation. Values in the waterfront areas have jumped 20 to 25 percent per year, compared to about 10 percent a year for inland areas, Seelhorst has said.

http://www.app.com/apps/pbcs.dll/article?Date=20060414&Category=NEWS02&ArtNo=604140447&SectionCat=&Template=printart; April 14, 2006 7:14 PM
Anonymous said...: Can anyone tell me of a state with no property tax (school tax) or a state with the lowest property tax.; April 14, 2006 11:46 PM
Anonymous said...: People are foolish, rates are rising, who knows they may go to 8% or to 19% like they have before, almost all areas have tons of inventory sitting empty. This is not a 6 month problem, not a year problem, it may be a one or two decade problem like Japan. Never before has a society taken on so much debt, unless your house is paid for with cash its a liability on the balance sheet, along with your SUV, which you will be selling when $5 gas arrives next year.; April 15, 2006 8:09 AM
Anonymous said...: A friend bought a house in socal i n 2000 for 185,ooo and now he owes 420,000 with an io loan and ready to refi again. The house is worth 480,000 how long before he's bk. Lots of these people in socal but they have a nice suv with 20's. Maybe not this year or next but this will all come to a bad end for alot of people.; April 16, 2006 6:00 AM
Anonymous said...: The sick and incoherent person who posted on Sunday, April 16, 2006 7:16:53 AM

should be investigated by the police!; April 16, 2006 11:52 PM
Anonymous said...: To ANON 12:02:03 PM
You said 'the market is correcting itself'. Do you know how many pro- real estate people I have heard repeat that phrase recently?? A shhheeat load. You are merely repeating what you heard someone say or in the media. You are in denial! You are probably in the industry and drank not only the glass of kool-aid but the entire jug. As far as RE agents never losing their jobs...In CA the old saying applies: If you dont know anyone with a RE license then you dont have many friends. They are a dime a dozen now. The industry is saturated with RE wanna-Bes. When the market turns a bit more south, heads are going to roll. Think the dotcom bust. All those wanna-B Microsoft certified engineers that signed up at the corner stripmall school promising instant 90k salary upon graduation. I know those guys, they are now working at Circuit CIty. This party is over. Good luck with that wishful thinking.; April 17, 2006 9:49 PM
Anonymous said...: The correction is just beginning in the bubble areas and it will end with a 50% discount if that's what you mean by correction. Even non-bubble areas will be hit due to higher interest rates.; April 17, 2006 10:20 PM
Anonymous said...: This below is the actual source of the housing bubble pop:

TOKYO, April 18 (Reuters) - The Bank of Japan sees consumer prices continuing to rise and is committed to supporting the economy's long-term growth through appropriate policy, BOJ Governor Toshihiko Fukui said on Tuesday.

"We will continue to support sustainable growth under stable prices by conducting monetary policy appropriately in line with changes in economic and price conditions," he said.

He made the comments in a statement from an address before the central bank's first regional branch managers' meeting since scrapping its ultra-easy monetary policy last month.

The BOJ ended an unusual five-year-old policy of flooding the banking system with extra funds on March 9 and switched to a more conventional policy of manoeuvring interest rates.

-------

The housing bubble is partly Greenspan's fault, but mostly it was Made In Japan.

I think we are going to see a revival of the power and the fears of Japan, Inc., as we did in the 1980's---except this time it will be with the added labor force of the Chinese producing Japan's as well as China's own technology.

They noisly argue over WW2 (and Japan was a real bastard to the Chinese), but in truth the Japanese have been very very big investors in China.

When it comes to taking in the hard cash and technology, the Chinese can forget about history for a while.; April 18, 2006 2:33 AM
moonvalley said...: Who are these dumbass millionares buying 1200 sqft termite condos in Sonoma County for 600k plus? People are fucked beyond comprehension.
I think a great many of them are Flippers. Pretty soon they'll be flipping themselves right into bk court.; April 18, 2006 8:13 PM
Anonymous said...: Here's a wake-up call... this mortgage calculator that shows why the bubble will pop... check out what happens to a 2/28 Interest Only loan when it adjust for the first time:

http://www.forsalebyownercenter.com/tools/228adjustableratemortgagecalculator.aspx

(about 550 billion in ARM loans adjusting this year and 1 trillion next year); April 19, 2006 7:52 PM
Smart Grid blogger said...: read this: Home loan demand down as rates hit new highs

By Julie Haviv
Wed Apr 19, 7:02 AM ET

NEW YORK (Reuters) - Mortgage applications fell for a second consecutive week, led by a decline in demand for home purchase loans, as interest rates reached new multiyear highs, an industry trade group said on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended April 14 decreased 1.7 percent to 569.6 from the previous week's 579.4.

Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.56 percent, up 0.06 percentage point from the previous week, its highest level since the week ended June 7, 2002 when it reached 6.65 percent.

The 30-year fixed-rate mortgage, the industry benchmark, is also above last year's high of 6.33 percent, reached in the week of November 11 after climbing on and off from a 2005 low of 5.47 percent in June.

The MBA's seasonally adjusted purchase mortgage index fell 2.7 percent to 407.4 from the previous week's 417.7.

The index -- widely considered a timely gauge of U.S. home sales -- was also below its year-ago level of 466.7.

The group's seasonally adjusted index of refinancing applications decreased 0.4 percent to 1,526.1 compared to 1,532.4 the previous week. A year earlier the index stood at 1,870.0.

The refinance share of mortgage activity increased to 36.4 percent of total applications from 36.0 percent the previous week.

Fixed 15-year mortgage rates averaged 6.19 percent last week, up from 6.17 percent the previous week. Rates on one-year adjustable-rate mortgages (ARMs) increased to 6.00 percent from 5.97 percent.

SIGNS OF COOLING IN HOUSING MARKET

Historically low mortgage rates have fueled a five-year housing boom, helping support the U.S. economy's recovery from recession despite uncertain business investment.

Analysts differ on whether or not there is a housing bubble, but most agree that the market is cooling off from its record run.

The MBA's soft data followed other reports this week that showed cooling in the U.S. housing sector.

The Commerce Department said on Tuesday the pace of U.S. housing construction slowed more than expected in March as both the rate of starts and permits declined to their lowest levels in a year.

Earlier in the week, the National Association of Home Builders said its influential index of U.S. home builder sentiment fell for a fourth consecutive month in April to its lowest level since November 2001.

The MBA's survey covers about 50 percent of all U.S. retail residential mortgage originations. Respondents include mortgage bankers, commercial banks and thrifts.; April 20, 2006 7:14 AM
Anonymous said...: APRIL 20, 2006
News Analysis
By Peter Coy

Why Housing Looks Rickety

Real estate bulls shouldn't count on the Fed abandoning further hikes. Here's why the squeeze could well grow worse; April 20, 2006 2:48 PM
Anonymous said...: http://www.orlandosentinel.com/business/orl-homes2006apr20,0,3990766.story?coll=orl-home-headlines

RED-HOT HOUSING

Home sales slip, condos soar

Condo sales up more than 158 percent compared with March 2005.
Jack Snyder
Sentinel Staff Writer

April 20, 2006

The number of homes on the market in Orlando ballooned again last month as sales of single-family houses continued to cool and the momentum shifted strongly to condominiums, according to figures released Wednesday.

The Orlando Regional Realtor Association's inventory reached a record 14,559 homes in March -- a strong bump up from 12,966 in February and nearly five times the count from a year ago.

Existing-home sales totaled 2,781 in March in the local Realtors' "core market," which is mainly Orange and Seminole counties. That was 10 percent better than a year earlier and a record for March.

Although condo sales in the core area were up more than 158 percent compared with March 2005, sales of single-family homes were down more than 9 percent.

Through the first three months of the year, sales overall in the core market were up 9.1 percent. But single-family home sales were down 7.8 percent, while condos were up 145.7 percent and duplex/townhome/villa sales were 47.1 percent ahead of last year's first-quarter pace.

A year ago, single-family home buyers engaged in bidding wars for many properties, and many homes sold for well beyond the owner's asking price.

No more. Gary Balanoff, broker-owner of ReMax Select Oviedo, said the huge inventory of homes for sale has "chased away the craziness."

People looking for a primary residence now have moderating prices and more properties from which to choose, and "can get a reasonable value in a home," Balanoff said.

However, investors who bought houses to flip quickly for profit may be finding "they have no one to sell them to," Balanoff said.

The Realtors' records show a steady increase in the average time a house is spending on the market before selling -- now 50 days, compared with 37 a year ago. The average time on the market has risen each month since September.

The median sales price in the core market, meanwhile, has been stuck in neutral for nearly a year. It was $240,000 in March compared with $241,250 in February, a high point of $249,900 in November, and $239,500 last June.

Still, the March figure was up nearly 19 percent from the median price of $202,000 exactly a year earlier.

Sellers more reasonable

Brokers said sellers are more realistic about price now as buyers peruse the new, huge selection of properties.

"Buyers can be choosy," said Lydia Pisano of Keller Williams Realty at The Vistas in east Orlando. "Sellers are accepting contingency contracts [a sale predicated on the buyer also selling a home] and negotiating repairs. That was unheard of last year."

The market also has changed for builders of new homes, Pisano said.

"My goodness. They're giving away trips, paying closing costs and lots of other things to entice buyers," she said.

Cambridge Homes recently offered a Mini Cooper automobile with certain homes, or upgrades of a similar value.

Wayne Robbins tried for two months to sell his 3,000-square-foot home with a swimming pool near Orlando's Dubsdread Golf Course on his own for $685,000, but last month listed the property with a broker. Robbins said he may also lower the price.

The downtown Orlando market -- which has been red hot, especially for condominium sales -- appeared to tank in February before reviving some in March, said Darryl Hunt, an agent with ReMax Town Centre.

Hunt said he had eight sales in January, then no action in February. "I had zip," he said, though he added: "It bounced back in March. I had five sales."

Downtown prediction

Hunt said he thinks the downtown market will remain solid this year.

"A lot of people want to be downtown," he said.

In the larger, four-county metro area -- Orange, Seminole, Osceola and Lake -- total resales fell 0.06 percent compared with March 2005 -- only the second year-over-year decline in nearly 18 months. Still, sales through the first quarter remained ahead of last year's record pace by a little more than 13 percent.

Realtors said they continue to view the area's market as healthy, despite the slowdown in single-family home sales.

"The spring selling season has arrived with a flourish," Beverly Pindling, president of the Orlando Regional Realtor Association, said in response to the 10 percent increase in the core market's sales overall.

"The increase in sales and new listings just about assures we will experience robust activity for at least the next six months," she said.

One cloud hovering over any 2006 forecast: rising interest rates on home mortgages. The Realtors' report noted that the average mortgage interest rate nationwide in March was 6.17 percent -- the highest monthly average since June 2004.

Rates have been trending slowly upward. The average for a 30-year fixed-rate loan for the week that ended April 13 was 6.49 percent, up from 6.43 percent the week before, according to Freddie Mac, a national mortgage buyer.

Lindsay Minnema of the Sentinel staff contributed to this report. Jack Snyder can be reached at 407-420-5094 or jsnyder@orlandosentinel.com.

Copyright © 2006, Orlando Sentinel | Get home delivery - up to 50% off; April 20, 2006 6:05 PM
Anonymous said...: Denial. Not just a river, it's a lifestyle!

http://biz.yahoo.com/prnews/060419/law012.html
-----------
According to the latest Experian-Gallup Personal Credit Index(SM) survey, 71 percent of consumers say it is likely that a housing bubble and collapse of prices could occur in the United States within the next year. Twenty-four percent say such a housing bubble is not likely. In contrast, a much smaller number of consumers, 32 percent, expect the collapse of a housing bubble within their own area in the next year, and 65 percent say it is not likely.

[...]

"While consumers are clearly concerned that housing activity will slow this year, it is somewhat reassuring that they are much less pessimistic when talking about the conditions where they live as opposed to the nation as a whole," said Ed Ojdana, group president of Experian Interactive(SM). "The relatively small number of consumers expecting significant housing price declines is also a positive sign given consumer expectations of a housing slowdown."

-----------------------

So, is this like the recent obesity survey?

"Yeah, everybody ELSE are revolting fat hogs except me and my friends."

Let's use the reassuring ideas of our Group President of Experian Interactive to reassure us that the obesity bubble, just like the housing bubble, is just a mythical delusion that people have of somebody else, somewhere else, somewhere over the rainbow.; April 20, 2006 7:44 PM
Anonymous said...: Check out what might happen when the ARM's start to adjust
http://www.firstamres.com/pdf/MPR_White_Paper_FINAL.pdf; April 20, 2006 8:03 PM
Athena said...: well... sonoma valley has realtwhores still advertising and inviting people to hop into this HOT SELLERS MARKET... so even in the face of real numbers the denial is inpenetrable and the ignorance is willful...

Sonoma County MLS: 2828
(Bareis MLS)

Price Reduced: 564
(zip realty)

Sonoma County for sale listings progression
3/20/06 = 1742
3/26/06 = 1766
4/03/06 = 1888
4/19/06 = 2828

Sonoma Valley MLS: 291
(GMAC)

Price Reduced: 66
(ziprealty.com)

Sonoma Valley for sale listing progression
2/14/06 = 172
2/14/06 = 183
2/24/06 = 193
2/25/06 = 200
2/27/06 = 214
3/01/06 = 219
3/04/06 = 220
3/12/06 = 230
3/20/06 = 236
3/26/06 = 238
4/03/06 = 268
4/19/06 = 291

sonoma county has 174,000 households...(population mid 400,000)

Sonoma Valley has just north of 4000 households and population 9,600; April 21, 2006 2:04 AM
Anonymous said...: Crude Oil Prices Rise Above $73 a Barrel

April 21, 2006

http://news.yahoo.com/s/ap/oil_prices;_ylt=AlscXMQMhJ0vYDGG2Yz.Emis0NUE;_ylu=X3oDMTA2Z2szazkxBHNlYwN0bQ--; April 21, 2006 7:12 AM
Anonymous said...: http://www.condoflip.com/find_a_condo_flip_search_city_d1.asp; April 22, 2006 2:37 AM
Anonymous said...: What's with all this political crap lately?

Just talked to a realtor friend from Austin and she says things have been slow lately. The houses there are very reasonably priced as there was no bubble there. I think the high energy and rising rates are taking their toll everywhere.; April 22, 2006 4:55 AM
an_dochasach said...: For a laugh, Checkout FirstRung.co.uk!

I live in the bubblishious island of Ireland, just a few hundred miles west of Keith. You might have seen this before, but I got a chuckle when I stumbled on the firstrung blog:

http://firstrung.co.uk/articles.asp?pageid=NEWS&cat=47

"First Rung" of course, refers to the "property ladder", the urban mythology that if you don't buy now, you'll be locked out of property when it rises to infinity and beyond! (which is much higher than average income around these parts)

I've begun calling it the "property albatross", because in this day and age, mobility is key to long-term job security.
Property can be as cursed as the dead albatross which was hung on the neck of the ancient mariner.
I followed my career to Ireland. I may have to follow it to India or China. Why should I anchor my life to property which is destined to devalue as soon as the jobs migrate farthur eastwards? I made the mistake of hanging onto such an albatross in the U.S. for a little too long, fortunately it was a small one and I let it go before it cursed me.; April 22, 2006 4:20 PM
Anonymous said...: Damn, I'm moving to Australia...

The federal government will finally manage to do what most Australians struggle to achieve - pay off the dreaded credit card.

Treasurer Peter Costello has declared Friday "debt-free day" to mark the government's final payment on the commonwealth bankcard.

"As best as we can tell, tomorrow, the commonwealth of Australia will eliminate its net debt," he told the Committee for Economic Development of Australia (CEDA).

"Tomorrow, April 21, 2006, will be Debt-Free Day.; April 22, 2006 6:09 PM
Anonymous said...: The cold hard truth for me is that I lost a home in 1991 California to a 50% adjustment in the price from government cut backs in my community. Yes I am bitter! I hate Realtors, Mortgage brokers, and the like. This time I saved money trying to "outsmart" the market and esentially what has happened is I have spun my wheels to keep up with F@chking Government Sponsored Inflation while paying their c@ck s@cking taxes and remaining a slave to the welfare system. Street people are my new heroes. As far as I am concerned the terrorists did screw up our economy and acomplish their mission. This aint goin my way, I'm goin back on the bottle with keith!; April 23, 2006 1:45 AM
Anonymous said...: " As far as I am concerned the terrorists did screw up our economy ..."

Inside jobs don't count.; April 23, 2006 1:58 AM
Anonymous said...: I think the rate at which the bubble deflates will largely be determined by the real estate psychology that develops in the next couple of weeks. If at the end of April we see estimated values of the median home price take another monthly fall then we may see the selling panic we have anticipated. However there will be a group of real estate investors that are so heavily invested in the market that they will ride it to the bottom simply because they will come to think they have no other choice. Of course they would be wrong but many will choose bankruptcy over selling at a loss.; April 23, 2006 8:40 AM
Anonymous said...: Just read your blog on http://www.realblogging.com.

Bubble aside for a second. Check out the latest post on RealBlogging called The Changing Real Estate Industry. Its a great summary about the evolution of the realtor industry over the last 10 years.

Based on research it does clearly validates that the industry is changing. Combined with the bubble and no question many interesting things will happen.; April 23, 2006 5:27 PM
Anonymous said...: Wow! I knew things were bad under Halliburton and KBR in Iraq but check this out. A new low ... human trafficking.

http://www.mercurynews.com/mld/mercurynews/news/politics/14413048.htm; April 24, 2006 10:21 PM
Anonymous said...: Let the firestorm begin.....here we go:

You guys are right that housing is going to crash -- in REAL terms -- i.e., in terms of today's dollars relative to some non-inflationary benchmark like gold.

Yet in NOMINAL terms -- actual U.S. dollars -- real estate will just keep on rising.

All those waiting for the "crash" are going to be sorely disappointed to wake up in 2011 and find that housing prices are up another 50%, while the value of the dollar has been wiped out by relentless inflationary money creation by the Fed.

In this environment it actually makes sense to own real estate and borrow against it to the hilt -- as many have done -- and then just hang on and pay it back in inflated worthless dollars down the road.

You guys are banking on DEFLATION, which is a possibility, but by no means a certainty as you're assuming. It's my guess that with trillions and trillions of dollars in debt, the U.S. has no choice but to continue on its course of huge inflation. And if that's the case, it makes sense to borrow right along with them, in today's dollars, and pay it back later in tomorrow's worthless dollars.

If you're really a dedicated "housing panic" acolyte, then the price of gold has to enter into your equation. If it's not, then I'm afraid you're going to be the bag-holder, not all those who own real estate, who already are sitting on a great inflation hedge.; April 25, 2006 3:20 PM
Anonymous said...: 1) Admin: get rid of that splogger!

2) Eliot Spitzer: go get em, Tiger!

http://news.yahoo.com/s/nm/20060425/pl_nm/crime_spitzer_mortgages_dc_1;_ylt=AmE7NaHbDdf4hqB2X5f63mdv24cA;_ylu=X3oDMTA2ZGZwam4yBHNlYwNmYw--

NY Spitzer to announce mortgage fraud ring case

1 hour, 23 minutes ago

NEW YORK (Reuters) - New York Attorney General Eliot Spitzer and state Banking Superintendent Diana Taylor on Tuesday said they will announce "the dismantling of a massive mortgage fraud ring" later on Tuesday.
ADVERTISEMENT

A spokeswoman for Spitzer declined comment because it involves criminal indictments of individuals. A press conference is scheduled for 1 p.m. EDT in lower Manhattan.
-----------------

Why do I get the feeling that Eliot Spitzer is doing more public service than ten thousand other government regulators and lawyers?

I'd love to tag-team him and Fitzgerald on all the war profiteering.; April 25, 2006 5:01 PM
Anonymous said...: The only reason you hear of Spitzer is because he holds a huge press conference everytime he does something. He's running for higher office. You're such a sucker; April 25, 2006 5:41 PM
Anonymous said...: You are assuming that the Fed will go with hyper-inflation and cause banks to fail. If inflation is at 15% and banks loaned out money at 5% then the banks are losing alot of money and the banking system will collapse. Look at what happened to Argentina, Germany and Brzail with hyperinflation.; April 25, 2006 11:20 PM
Anonymous said...: Now available - House Flipper merchandise (t-shirts, hats, calendars, light-switch covers) - show your pride!; April 26, 2006 4:28 AM
Anonymous said...: I heard an add on the radio for a builder selling houses at COST in Palm Coast Florida, which is in Flagler County, the fastest growing county in the US!

I have heard of car dealers doing that before, but never a home builder.; April 26, 2006 3:01 PM
Anonymous said...: Waduya think Keith?
http://www.lewrockwell.com/englund/englund34.html
The Federal Reserve and Housing:
A Cluster of Errors?
by Eric Englund

Without bank credit expansion, supply and demand tend to be equilibrated through the free price system, and no cumulative booms or busts can then develop.

~ Murray Rothbard

In my two decades as a surety bond underwriter, I have seen financial fads come and go. One aspect of my job entails analyzing personal financial statements, and I most certainly have seen scores of them. Along the way, I have been able to discern distinct patterns in the financial behavior of people. What is so striking to me is the herd-like behavior of human beings – many of whom seem to be easily swayed by the marketing blitzes of Wall Street brokerage houses, banks, and other financial services companies. As Ludwig von Mises stated in his magnum opus Human Action:

Common man does not speculate about the great problems. With regard to them he relies upon other people’s authority, he behaves as "every decent fellow must behave," he is like a sheep in the herd. It is precisely this intellectual inertia that characterizes a man as a common man. Yet the common man does choose. He chooses to adopt traditional patterns or patterns adopted by other people because he is convinced that this procedure is best fitted to achieve his own welfare. And he is ready to change his ideology and consequently his mode of action whenever he becomes convinced that this would better serve his own interests.

Unfortunately, the common American does not understand he is being manipulated and impoverished by the Federal Reserve. When money is no longer real (i.e. fiat currency vs. gold and silver), then people may come to believe in the surreal, and a hyperreality emerges. In particular, during the reign of Alan Greenspan, money and credit – created out of thin air – rained upon Americans as if to assure us that crop failures and misfortune had been banished from U.S. soil. Hence, we came to live in a world of plenty where one may become wealthy by simply purchasing a house – with lots of borrowed money – and by "investing" in stocks for the long run. What a dream it is to become wealthy without effort. This mass delusion is only one step away from collectively believing that cotton candy is a cash crop. Alas, Americans will soon discover that housing values don’t grow to the sky and that heavy mortgage debt leads to a harvest of financial despair. The Austrian theory of the trade cycle will be validated yet again.

So here’s a quick trip down memory lane. Early in my underwriting career, cash and savings were king. Accordingly, this frame of mind was reflected in personal financial statements. As the 80s rolled on, Americans bought into the pop culture that is Wall Street. Without fail, I saw people cash in CDs and purchase mutual funds. Peter Lynch, indeed, popularized such "investment" vehicles for long-term wealth creation. Then John Bogle flaunted the low-expense-ratio S&P 500 Index Fund as the wisest way to build a substantial retirement nest egg. And who can forget the dot.com and telecom crazes of the late 90s? Americans envisioned themselves retiring to Easy Street based upon owning shares of Amazon.com and Global Crossing. Lastly, let’s not forget the Wall Street darling known as Enron. This company’s common stock was going to make each of its shareholders wealthy. So why aren’t Americans taking early retirement, en masse, to lives of luxury? Where is all the wealth promised by Wall Street?

To date, I can’t say that I have seen a single individual become wealthy by investing in the "products" promoted by Wall Street. From the results I have witnessed, Wall Street preys upon the economic illiteracy of Americans and does a most efficient job of transferring wealth from the masses to the bank accounts of the Wall Street – mostly Ivy League – elites. Over the years, a familiar pattern has emerged: Wall Street brokerage houses make their recommendations, the sheeple get fleeced, and I bear witness to a clustering of human financial error as reflected in the personal financial statements that I survey daily. For the most part, such financial errors have not been devastating, but were merely temporary misadventures on the part of misguided individuals.

As a quick aside, yes, I have seen some individuals become wealthy. Yet such wealth emerged by way of starting up and maintaining successful businesses. Such entrepreneurs, typically, maintain strong personal liquidity and keep debt loads at reasonable levels.

Nothing, however, could have prepared me for the horrors I have witnessed the past few years. Because of the housing bubble, as engineered by the Federal Reserve, Americans are now drowning in mortgage debt while naïvely believing that living in a house is the path to wealth creation via long-term capital appreciation. Thus I am just going to come out and say it: countless American homeowners are already insolvent and simply don’t know it; and many of them continue to make ends meet by borrowing against credit cards and ever-shrinking home equity.

It is commonplace for me to see married couples with mortgage-debt-to-income ratios that are wildly askew. The hyperreality conjured by the Federal Reserve’s relentless inflation of the money supply is characterized by a populace which believes that a permanent plateau of prosperity has been attained. This is the boom phase of the trade cycle. A mindset, correspondingly, arises in which people have absolutely no fear of debt. After all, the Federal Reserve has the economy under control. Debt, in fact, is embraced as a means to lever up one’s return on investment.

When the bust phase of the trade cycle materializes – and followers of Austrian economics know it will, eventually – then the real horror show will unfold. Let’s face it: highly leveraged Americans have little to no chance of ever paying back their enormous mortgage debts. All it will take is for a husband or a wife to lose a job, or for interest rates to go higher, in order for mortgage debt to become unmanageable. In the bust phase, mortgage defaults will become a deluge.

Earlier, I mentioned that the Federal Reserve "engineered" America’s housing bubble. To be sure, there are those who deny a housing bubble exists. Hence, such deniers argue there is no correlation between aggressive growth in M3 and the spectacular rise in housing prices across the United States – as if the Federal Reserve’s pounding down of interest rates occurred in a vacuum. To this I respond with a quote from page 1 of a September 2005 study sponsored by the Board of Governors of the Federal Reserve System titled House Prices and Monetary Policy: A Cross-Country Study. Here is the smoking-gun quote: "Like other asset prices, house prices are influenced by interest rates, and in some countries, the housing market is a key channel of monetary policy transmission."

With the bursting of the NASDAQ bubble signaling that the U.S. was heading into a recession – not to mention the shock of 9/11 – the Federal Reserve took desperate measures by goosing the money supply and driving the Fed Funds rate down to 1%. These monetary central planners knew that housing demand was very much interest rate sensitive, and they were counting upon the opiate of easy credit, at remarkably low interest rates, to stimulate the "animal spirits" of Americans in order to set the housing market ablaze. The Federal Reserve’s central plan worked. Uncle Sam’s economy was rekindled as trillions of dollars were loaned into existence via the housing market – the Fed’s monetary transmission mechanism. Therefore, America’s housing bubble did not emerge spontaneously in a bona fide manner. Rather, it is a debt-laden financial monster created by the mad doctors populating the Federal Reserve.

As surely as night follows day, a credit-induced boom is followed by a bust. Moreover, only the Austrian theory of the trade cycle provides the intellectual framework allowing one to understand the boom-bust cycle. Before delving a bit further into this theory, there are a couple of things to keep in mind. First of all, as premeditated by the Federal Reserve, the housing boom was credit-induced. Secondly, America’s savings rate is near zero, so savings-induced growth cannot explain the housing boom. What we will find, as elucidated by Roger Garrison, is that central banking is at the epicenter of the boom-bust cycle. Dr. Garrison provides the following explanation in the Mises Institute’s remarkable book The Austrian Theory of the Trade Cycle:

The Austrian theory of the business cycle emerges straightforwardly from a simple comparison of savings-induced growth, which is sustainable, with a credit-induced boom, which is not. An increase in saving by individuals and a credit expansion orchestrated by the central bank set into motion market processes whose initial allocational effects on the economy's capital structure are similar. But the ultimate consequences of the two processes stand in stark contrast: Saving gets us genuine growth; credit expansion gets us boom and bust.

Assuredly, the housing boom is destined to bust just as the NASDAQ bubble did – anecdotal evidence is already pointing toward this end. When the NASDAQ bubble did burst, I saw the liquidity of many Americans diminish significantly. Yet the housing bubble is vastly different and the financial pattern is unmistakable. Trillions of dollars of mortgage debt came into existence in a very compressed timeframe – in less than five years. Consequently, over the last three years, I have never seen so many dangerously-leveraged personal financial statements in my entire underwriting career.

This mortgage-debt bubble, as engendered by the Federal Reserve, is leading millions of Americans to financial ruin. This may become the most calamitous clustering of financial error in U.S. history. If anything positive comes out of this economic mess, perhaps it will be the demise of the Federal Reserve itself. Regrettably, the Fed’s failure will have come at an enormous price, including the possibility of volatile social unrest.

A terrifying thought it is.

April 22, 2006

Eric Englund [send him mail], who has an MBA from Boise State University, lives in the state of Oregon. He is the publisher of The Hyperinflation Survival Guide by Dr. Gerald Swanson. You are invited to visit his website.

Copyright © 2006 Eric Englund

Eric Englund Archives; April 26, 2006 5:25 PM
Smart Grid blogger said...: Housing Bubble Fact or Fiction?

Tuesday , March 14, 2006

Paul B. Farrell

LOS ANGELES — Back during the '70s recession I was a real estate expert with Morgan Stanley. We helped banks and REITs work out billions of loser portfolios, reorganize, file bankruptcy, even advised the U.S. Dept of Housing & Urban Development on the collapsed Federal New Towns program. I've worked for developers and mortgage bankers, got degrees in architecture and city planning, taught commercial real estate at Cornell University.

But oddly, like the rest of America, most of the time I don't think about the housing bubble that's about to pop. We ignore the coming storm.

Click here to visit FOXBusiness.com's Real Estate page.

But when it gets up close and personal — like my family's home — well, suddenly I'm shocked out of my denial.

The shocker? I just learned we live in a metro area that could see a devastating 55.8% decline in home prices in the next five years. Worse yet, most of the real estate north and south of us — from San Francisco to San Diego — is predicted to decline 50% in the next five years. Ouch!

That dire prediction was made by former Goldman Sachs (GS) investment banker John Talbott in his new book, "Sell Now! The End of the Housing Bubble."

Next time you're in a bookstore check out his top 130 metro areas. The chapter's titled, "Are You in Trouble?"

Warning: Chances are you're in big trouble, or in denial.

And folks, this is not just an isolated West Coast phenomenon. Talbott points out that America's top 40 cities are facing a average 47.2% decline: Boston is 49.4%. Miami 44.8%. New York 44.6%. And Chicago is 27.3% overpriced. Yikes!

But "so what?" you say. You've heard it before. Right? Warnings reported month after month. For example, Talbott reminded me of an editorial in The Economist last summer: "Never before have real house prices risen so fast, for so long, in so many countries. Property markets have been frothing from America, Britain and Australia to France, Spain and China. Rising property prices helped to prop up the world economy after the stock market bubble burst in 2000 ... This is the biggest bubble in history."

Yes, the irrational exuberance of our failed stock market simply shifted over into a new irrational exuberance in housing. In five short years an estimated $30 trillion was added to housing prices worldwide, an unsustainable 75% increase to $70 trillion, largely due to then Fed chairman Alan Greenspan's cheap money policies.

Greenspan dismissed the global bubble, telling Congress it was just a little "regional froth." Happy-talk, while our housing and mortgage industry has been taking advantage of naïve home buyers and sellers with loose underwriting practices: Low-interest home equity loans, and interest-only, low-equity loans feeding housing price inflation.

Curse of Cassandra

My files are full of warnings from America's top economists predicting a housing market collapse and a widespread global disaster: Gary Shilling, Bill Gross, Jeremy Grantham, Robert Shiller, Robert Rubin and others take exception to the deceptive happy-talk of self-serving spinmeisters in Washington, Wall Street, realty brokers and homebuilders.

Lately, powerful voices are challenging the happy-talk. In his latest "Investment Outlook: The Gang That Couldn't Shoot Straight" Pimco's Bill Gross takes direct aim at President Bush's Economic Report prepared by ex-CEA boss and now Fed Chairman Ben Bernanke. He bluntly accuses them of outright lying: "It's not so much that the report was a compilation of untruths or even half-truths. It's just that it failed to tell the truth," hiding the fact that we have "borrowed from the future to pay for today's party."

The party's about over. Economist Gary Shilling recently wrote in Forbes: "The current housing weakness will develop into a full-scale rout ... It's clearly a bubble and is nationwide ... The house price collapse will induce a painful recession that will send U.S. stocks into a tailspin ... China will suffer a hard landing ... and weakness in the U.S. and China will spread worldwide."

Unfortunately, bubble warnings are routinely dismissed. Our brains can't handle all the bad news. Besides we've been brainwashed into short-term thinkers, incapable of long-term planning. Witness the collective denial and paralysis toward mounting deficits from out-of-control federal budgets, foreign trade, war debt, state, municipal and consumer debt, under-funded pensions, Social Security and Medicare shortfalls.

Still, experts like Gross, Shilling, Talbott and others are dismissed as "crying wolf" one too many times. The housing bubble hasn't popped, warnings accumulate, we're overwhelmed, confused, numb, feel helpless, so we fade into denial. And our leaders are even more oblivious, hardened and ineffectual.

But ... am I going follow Talbott's advice and "sell now?"

No. We love our home and our town. Besides, even if prices do fall 55.8%, we're still ahead of the game, out of harm's way. But maybe you should sell now. A lot of people are going to get badly hurt in the real estate crash, far worst than in the 2000-2002 recession when we lost $8 trillion in market cap.

If your stock portfolio were out of whack there's a possible solution: Dump equities now, go all-cash or to the "nuclear bond option:" Put one quarter in each of four sectors: Short-Term Corporate Bond Index (VFSTX) ; Intermediate-Term Bond Fund (VFITX) ; Inflation-Protected Securities Fund (VIPSX) ; and Money Markets or U. S. Savings I-Bonds. Shilling favors bonds in a deflationary recession. They paid roughly 10% in 2000-2002 bear. Alternatively, if you have a well-diversified portfolio, sit tight; back in the 2000-2002 they beat the S&P 500 by an average of 15% annually

Sadly, unlike the stock market there's little you can do once the illiquid housing market collapses. If you can't sell now, you'll have no choice but bite the bullet.

For example, assume you live in one of America's top 40 metro areas. You bought last year for $500,000 with $450,000 in mortgages. If the market drops just 10%, your equity's gone.

And if it drops the predicted 47.2%, your home's worth $250,000, you really are in trouble. If you lose a job, or suddenly get hit with extraordinary expenses, or just can't make tax and mortgage payments, or otherwise forced to sell, you could be wiped out under the tough new bankruptcy laws.

So please read Talbott's book closely: Is your home is at risk? Then quickly decide whether you can hang on in a housing collapse, a stock market bear and another long recession. And if not, consider taking his advice to sell now.

http://www.foxnews.com/story/0,2933,187831,00.html; April 26, 2006 7:03 PM
Anonymous said...: The headline:

"NEW HOME SALES UP 13.8%!!!!" *

"The increase more than reversed the 10.9% decline in Feb!"

See: bubbles are indeed for bathtubs!

That bubble BS is just America-hating negativism.

* oh you must be a nerd. You read the footnotes. Well good for you. See, here's the dope.

First, "The median price of homes sold in March dropped to $224,200, down 2.2 percent from what homes were selling for in March 2005. It marked the first time home prices dropped over a 12-month period since December 2003."

Second, "Both reports, however, showed that the number of unsold homes on the market at the end of the month rose to record levels, a development that was expected to depress price gains in coming months."

Hmm, not so nice.

But this one defines chutzpah. "The government cautions, however, that its housing data are subject to large sampling and other statistical errors. The margin of error is so large, in fact, that the government cannot say with confidence that sales rose at all in March. While sales were reported up nearly 14%, the margin of error was 15%."

Ha ha ha ha ha!; April 26, 2006 10:01 PM
Anonymous said...: Bill Gross of PIMCO is issuing ever more strident warnings of future inflation and dollar devaluation. His latest posting for May is impressive

http://www.pimco.com/LeftNav/Late+Breaking+Commentary/IO/2006/IO+May+2006.htm

--Andrew; April 26, 2006 10:35 PM
Smart Grid blogger said...: Bernanke Issues Fresh Warning on Inflation

By JEANNINE AVERSA, AP Economics Writer
7 minutes ago

WASHINGTON - Federal Reserve Chairman Ben Bernanke told Congress Thursday that rising energy prices jeopardize a currently strong economy and left the door open to the possibility of another interest rate increase to keep inflation in check.

"To support continued healthy growth of the economy, vigilance in regard to inflation is essential," said Bernanke, who delivered his most extensive thoughts on the economy in several months.

At the same time, though, he raised the prospect of the Fed pausing its nearly 2-year-old rate raising campaign.

"At some point in the future the committee may decide to take no action at one or more meetings in the interest of allowing more time to receive information relevant to the outlook," Bernanke said. "Of course, a decision to take no action at a particular meeting does not preclude actions at subsequent meetings," he added.

Bernanke offered a mostly positive assessment of economic conditions in an appearance before Congress' Joint Economic Committee.

To fend off inflation, the Federal Reserve on March 28 boosted a key interest rate by one-quarter percentage point to 4.75 percent. It was the 15th increase of that size since the Fed embarked on a credit-tightening campaign in June 2004.

At that March meeting, the Fed hinted that another rate increase could be in the offing. It said "some further policy firming may be needed" to keep the economy and inflation on an even keel.

Bernanke on Thursday said that a spate of economic barometers that have come out since the March meeting suggesting the economy is carrying solid momentum "have not materially changed that assessment of the risks."

Many economists are predicting the Fed will bump up rates by another quarter percentage point to 5 percent at the central bank's next meeting on May 10.

Some analysts believe that will be the last increase for a while. Others, however, believe the Fed could push up its key rate to as high as 5.50 this summer before stopping. In either scenario, economists believe the Fed will end its rate-raising campaign this year.

Although Bernanke held open the possibility of least one more rate increase on May 10, when the Fed next meets, he also attempted to keep his options open about future rate decisions.

The Fed chief stressed that interest rate decision could become less predictable, relying more heavily on incoming data about economic activity and inflation.

Rep. Carolyn Maloney (news, bio, voting record), D-N.Y., and Sen. Paul Sarbanes (news, bio, voting record), D-Md., raised concerns about interest rates moving much higher and suggested they would like to see the Fed end its rate raising campaign sooner, rather than later.

The economy has rebounded nicely from an end of year lull, Bernanke said.

Citing private forecasts, he said the economy grew at a rate of between 4 and 5 percent in the January-to-March quarter. That would mark a vast improvement from the anemic 1.7 percent growth rate registered in the final quarter of 2005. The government releases results of first-quarter growth surveys on Friday.

Growth will probably moderate in the coming quarters, but still remain good, Bernanke said.

But there are risks to this outlook, including energy prices, he said.

Oil prices zoomed to a record high of $75.17 a barrel last week. They have retreated a bit and are now hovering below $72 a barrel — still more expensive than a year ago. Gasoline prices have been marching up and are around $3 a gallon in some areas.

"Rising energy prices pose risks to both economic activity and inflation," Bernanke said.

If energy prices stabilize this year — even at a high level — their adverse impact on economic growth and inflation should ebb over time, Bernanke said. But with oil supplies lean and demand high, "periodic spikes in oil prices remain a possibility," he added.

Thus far, energy prices haven't significantly fed into the prices of many other goods and services. But Bernanke made clear that the Fed will continue to closely watch "core" inflation — which excludes food and energy prices — for signs about where inflation is heading. Bernanke said that the future direction of the housing market is also something the Fed will watch closely. Housing barometers suggest that "this sector will most likely experience a gradual cooling rather than a sharp slowdown," he said. That would bode for moderate slowdown in overall economic activity.

In terms of the economy's long-term health, Bernanke repeated his interest in seeing the United States' swollen budget and trade deficits curbed.

http://news.yahoo.com/s/ap/20060427/ap_on_bi_ge/fed_bernanke;_ylt=Aqgk.xUxBR2PIS8ke53XZ1WyBhIF;_ylu=X3oDMTA5aHJvMDdwBHNlYwN5bmNhdA--; April 27, 2006 4:19 PM
Anonymous said...: Now here's the REAL question:

What if all of your well-reasoned arguments are correct, and all of this is really happening -- and you're STILL wrong?

What if this whole bubble-bursting thing is still years away?

The Fed created the bubble, and they still have plenty of power to keep it going. They are not out of ammunition by any means. What do you think would happen to real estate when the Fed sees the bubble unwinding a bit too quickly, and drops rates back down to 1%?

Another round of re-financing, and another round of bubble-blowing. It's not over til it's over, and Helicopter Ben is still hovering overhead.....; April 27, 2006 9:24 PM
bearmaster said...: Does anybody here know what happened to that wonderful website

There is No Housing Bubble! ???

A wonderful humor blog that has disappeared into thin air?!?; April 27, 2006 9:47 PM
Anonymous said...: I've just written an economics paper about the state of the US economy and what I would do if I were Mr. Bernanke.

Looking at the large increase in worldwide housing wealth ($20 trillion) over the past 9 years I desperately began to look further into the causes to find some justification of higher asset prices to determine if another trend was responsible. I came to the revelation that we may be in the middle of a new era. In this new era classical economics doesn't apply because the underlying basis is so different than anything that has ever been experienced by mankind.

At which point I snapped out of my thoughts and recalled that "new era" argument was promoted in March 2000 when people justified an overheated stock market by saying those who didn't believe in it didn't see that we were in a new era and that the old laws of economics no longer applied.

I'm willing to bet the author of that article was bagging groceries by 2002.; April 27, 2006 9:53 PM
Anonymous said...: This article appears in the April 28, 2006 issue of Executive Intelligence Review.
HYPERINFLATION LIKE WEIMAR 1923
World System on Weimar
Collapse Curve

by Lyndon H. LaRouche, Jr.

April 20, 2006

The fakery of the outgoing Alan Greenspan administration, in burying the "M3" report, was clearly intended to conceal the fact that the rate of rate of increase of world prices of primary materials has the world as a whole currently on the same kind of "least-action pathway" curve of hyperinflation which gripped Weimar Germany during the second half of the year 1923.

Comparing the present rates of rates of increase of primary materials prices with the pattern for Germany 1923, indicates the likelihood that, under present U.S. and European policies, the world system could reach a point of collapse of the monetary system by not much later than September 2006, if not earlier.

Under the present trends in policy-making in the U.S. government, both in the careening economic-financial lunacy of the current Bush Administration, but also the "Alfred E. Newman"-like diffidence of a negligent U.S. Congressional fraction of the Democratic Party, the likelihood is that the world system as a whole will be in a U.S.-dollar-triggered collapse-phase before Autumn.

The point is not to predict what could happen by Autumn; the point is to kick the relevant political circles in the Democratic Party with the proverbial two-by-four prescribed for reluctant donkeys, and to do so hard enough, soon enough, and often enough, to move to the kind of emergency reform of U.S. policy which could stave off an otherwise onrushing general breakdown-crisis of not only the U.S. system, but the world system as well.

There is a relative handful of persons, typified by the Brookings Institution-based Hamilton Project team, who are capable of understanding this, and who already have command of most of the essential facts to be considered. There are professionals in other parts of the world, who could begin to understand this quickly, if they were kicked hard enough to come to the necessary state of wakefulness.

The world is thus, now, in the terminal phase of a hyperinflationary collapse of not only the dollar-system, but the world-system as a whole. To bring this into focus, consider the elementary features of the way in which Federal Reserve Chairman Greenspan's lunacy orchestrated the 1987-2006 phase of the relevant hyperinflationary cycle. Keep three illustrative curves in view: 1.) my "Triple Curve," which, since January 1996, has described the general characteristics of the ongoing collapse-function of the 1995-1996 interval. The curve of 1923 Weimar, Germany hyperinflation; and, 3.) The current hyperinflationary rate of rate of increase of primary commodity prices, as led by petroleum and metals.

(Leave the "supply-and-demand" freaks, and other statisticians from Swift's Island of Laputa, to play with themselves behind the barn, where they will be happy.)

Essentially, what Greenspan did, was to bail out the banks whose coffers had been emptied by the events of October 1987, by laundering the mortgage-based securities packages of Fannie Mae and Freddie Mac. The real-estate bubble was built up to its presently cancerous proportions for this continuing purpose. This, in turn, provided the baseline of monetary and derived financial emission for what was to become a hyperinflationary expansion of a physically contracting economy. (See my Triple Curve.)

In the end, this became the core of a global financial-monetary bubble comparable to that of medieval Venice's tool, the Lombard League of Europe's Fourteenth-Century collapse into a New Dark Age. However, in this case, the end-game phase of this hyperinflationary process was cornering of the world market in primary materials.

For those shrewd enough to recognize that the present world financial system is already hopelessly doomed, the witting class of predators must have a "landing place" outside the bounds of such a general financial-monetary collapse. Essential raw materials represent that landing-place.

Therefore the rate of inflation of the rate of inflation in the market for primary commodities is the characteristic curve of the present world monetary-financial system. This rate of rate of inflation, as reflected in the concealed behavior of M3, is the curve which corresponds to the Weimar Germany hyperinflationary curve of June-November 1923.

Underneath it all, is Leibniz's catenary-cued principle of physical least action, the fundamental principle of the Leibniz infinitesimal calculus and Leibniz's original correct discovery of the natural-logarithmic function derived from the double-catenary characteristic of the least-action principle. The comprehension of such systems in general, is found in the work of Riemann on hypergeometries.

Subscribe to EIW; April 28, 2006 6:16 PM
Anonymous said...: Charts to abouve article
http://www.larouchepub.com/lar/2006/3317weimar.html; April 28, 2006 6:18 PM
Anonymous said...: I am 30 days on a mortgage for the 1st time in my life (because I relied on hubby to send out the check). The lender has called me 3 times already.
OK, I was 30 days late, big deal, check's in the mail.

Is this standard procedure or are there that many delinquincies causing the lender to freak out? Is it normal to get a "collection call" after 1x30 or is it a sign of just how bad things are becoming?; April 28, 2006 10:58 PM
dcbubble.blogspot said...: wont urban markets with high paying jobs be hurt less by the housing correction than those markets far from the city center.

www.dcbubbble.blogspot.com; April 29, 2006 3:36 AM
Anonymous said...: You mean like Detroit?; April 29, 2006 6:02 AM
Peter Kosednar said...: Nice Blog - great read!; April 30, 2006 2:43 AM
Anonymous said...: LA ROUCHE IS CRAZY OR IS HE?

He was crazy but his idea to close borders, upgrade infrastructures(roads, bridges, dams, levees etc)start a conservation program to use biodeisel, solar, wind and ethenol, upgrade education and boost the country's engineers and scientist core now seems fucking genius. He's a nut but damn if more than half of his ideas wouldn't greatly improve America it's people and even the world. Except that thing of going to mars and the queen smuggling drugs.; May 01, 2006 12:58 AM
Anonymous said...: "What if this whole bubble-bursting thing is still years away?"

If the estimated value of the median new or existing home falls yet one more month then the market psychology takes the dratic turn we have anticipated and panic selling begins.; May 01, 2006 7:27 AM
Anonymous said...: "NEW HOME SALES UP 13.8%!!!!"

Pump and dump. You have seen it before how short can your memory be.; May 01, 2006 7:28 AM
Anonymous said...: "wont urban markets with high paying jobs be hurt less by the housing correction than those markets far from the city center.'

Check out Zillow.com and take a look at the 10 year plot for an area's median home price. Now draw a straight line through the pre-bubble period up to the present month and estimate the true value of the home. Then you tell me how will be lost. Zillow makes it sooo easy (if your living in a county with good housing record keeping).; May 01, 2006 7:33 AM
Anonymous said...: I am confused. Please explain this to me. I make an offer on a San Francisco house offered at $799.00. My offer is $850.00. I know this is the highest offer. There is another offer for $799.00. The seller made a counter offer for $875.00, but only to me and not the other party - obviously there is no bidding war. But the seller said there is another "verbal" offer for the amount close to what i offered. I decided not to bother with the counter offer and told my agent to proxy it to the seller. The seller went back to the other party and made a counter offer for $850.00. The other party made a counter offer for $825.00 and the seller accepted it.
First of all I feel stupid for making the offer for $850. Secondly why does the seller has rights to make me the counter offer on the higest bid with no bids close mine? And finally why are we such suckers to fall for this trick?; May 01, 2006 5:05 PM
Anonymous said...: ___________________________________
You guys are idiots! Just a bunch of pissed off renters that missed the market...

Tuesday, May 02, 2006 10:59:43 AM
__________________________________

Actually, I own a house. Been in it for 10 years. Switched to a 15 year mortgage when everyone else was switching to McMansions and cash-out refi's. Bought in '96 for 93k, now 'worth' $225k, owe 69k with 11 years left. My current investments should hopefully go up enough to allow me to pay off the house if need be in a year or two. Even so, I think I have enough equity to weather a pretty bad storm. Had the 'opportunity' to buy some florida land with a hme equity line of credit a year ago, which led me to do some serious financial research, chief among them financialsense.com and decided rather quickly to do a 180 on that. I should have some nice buying opportunities in a few years.

So no, I'm not a pissed off renter. It'll be refreshing to see sanity restored.; May 02, 2006 7:10 PM
Anonymous said...: I see a lot of people making the argument for a housing bubble vs. no housing bubble. But before we can say there is a housing bubble or not, don't we at least have to define what a housing bubble is? I'm sure we all have different ideas of what a housing bubble entails. In a bubble, we all expect housing prices to decline, but by how much? And do we expect a bubble across the entire country, on average, or just for some of the urban markets? Maybe a thread should be started based on that premise, unless it's already been done.; May 03, 2006 12:36 PM
AnonyRuss said...: Here is something posted on the Arizona Real Estate Department's website a couple of weeks ago.

http://www.re.state.az.us/
flashpage.html

A group of people have hit several REALTORS® in Arizona as well as in New Mexico. The scam is that one of them comes into a real estate office claiming to have an investor who is looking to buy houses, land or businesses in the area. Most of the accounts have been for large sums of money and multiple properties. The individual says that they are on a tight time schedule and the deals must be completed quickly. After the REALTOR® has spent their time doing all the required paperwork they later find out that the deals never go thru. The scam individuals have done this to several large agencies in the state with the same results. In some instances, they have requested hotel rooms and meals to be paid for by the REALTOR®.

They always claim to be related to the rock band Lynyrd Skynyrd. Most of the time they have other land or business deals going on so a REALTOR® can call the other agencies and it appears as though they are legitimate. They also are able to have unknown persons fax over paperwork showing they have a LLC company and are shareholders in that company.

If you need or have any additional information about this situation, please contact Ty Strout or Officer Cummins.; May 03, 2006 4:05 PM
Anonymous said...: Yeah, keep cashing out that equity to pay the monthly mortgage since you have $0 savings.

The reality is most people don't care how much debt they're in if all that crap they buy makes them happy. Life is short. Sometimes I think these folks are the smart ones. You can't take it with you:o); May 04, 2006 5:22 AM
Anonymous said...: Life is short unless you're broke and can't feed your family. Then it's a long miserable life that might be cut short with a life insurance policy and a ride off a cliff.; May 04, 2006 3:25 PM
Anonymous said...: Well, no. I AM a renter, but a very happy one. And I didn't miss the market. I bought in 1993 and sold in late 2005. I posted the profit I made elsewhere on the blog.

You sold in 2005 and made a profit. Good for you. Why didn't you get out of the market in 2004? Because you thought the market was still going up, right. Now, all of a sudden you are the brilliant one and everyone else are fools. Now that you are out of the market and made money you feel you can insult everyone who just now wants to now enter the market. True, many places are overpriced, but not all. The only fools out there are the flippers looking to make a qick buck and the people who laugh at the ones now losing money. It looks to me that you are talking down the market because you want to re-enter the market and can't afford it or at least not what you are willing to pay. What other reason is there to write a blog and bash everyone. Do you really care if people are losing money. I don't think so. To laugh at the ones who are losing money on a down market is just sad.; May 04, 2006 8:57 PM
Anonymous said...: Just go buy your $800k house and shut up already!
Heck, offer another $100k on top of that just to make sure you get the house. Just shut up!; May 04, 2006 9:44 PM
Anonymous said...: OMG.

The train is barreling down the tracks, and what do our Great American InDuhViduals do?

swig some more moonshine and run towards the light....

http://www.washingtonpost.com/wp-dyn/content/article/2006/05/02/AR2006050201606.html

Reasons Change for Refinancing
With Low Interest Rates Vanishing, Homeowners Take More Cash

By Kirstin Downey
Washington Post Staff Writer
Wednesday, May 3, 2006; Page D01

A greater proportion of mortgage refinancers tapped their home equity for cash in the first three months of this year than in any other quarter in the past 15 years, according to an analysis released yesterday.

About 88 percent of people refinancing their homes took out loans for at least 5 percent more than their original balances, according to the latest quarterly review of loans owned by Freddie Mac, a government-backed home mortgage company. However, more than half took loans at higher interest rates than they previously paid. In years past, refinancers chased lower rates.

-------------------------------; May 04, 2006 11:44 PM
Anonymous said...: OWNER GOOD LUCK! RENTERS GOOD LUCK!

I see many wanting to see the other hurt, my guess is that some owners in good times bragged too much so the renters are talking shit now that times are low.

As a whole a crash in the market is good and bad, some will now afford homes but if the economy suffers then we either will have inflation or hyperinflation on real items not CORE INFLATION things like transportation and food. Fuck the braggers, hope the best for your country.; May 05, 2006 6:09 PM
Anonymous said...: It seems relatively simple to get a lot and put a structure on it. I checked and a new 420 sq ft one bedroom trailer was $25,000 delivered, used ones were sold at a substantial discount. There is alot of undeveloped land in the west. Some areas were less than 5 people per square mile. I think alot of that is federal land reserved for jack rabbits and javelinas. The feds ought to auction some off to pay for some of their Washington DC restaurant bills.; May 06, 2006 2:31 PM
Anonymous said...: I love this blog but too bad my computer doesn't. Anyhow, I clicked on a few of the ad-links. Thanks.; May 06, 2006 5:05 PM
Anonymous said...: TO BE CONTINUED...

I should get an offer on my investment home in Monterey Ca., then I'm out of the game and on to gold, silver, copper or a little place down south.

Am I sweating bullets? Hell yeah!!

Will real estate come back sooner or later? Probably...but I fear for my country with the fiscal idiot at the helm.

Good luck to all!!!; May 07, 2006 7:20 AM
Anonymous said...: Buffet's silver went into the worlds first silver ETF. When the silver market has absobed 129 mill oz without dropping significantly, we have one more reason to conclude that we are in a phase of physical shortage of supply.; May 07, 2006 1:45 PM
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