I think the fact that the NAR, realtors and the corrupt David Lereah himself, have been proven to be balls-out liars has a little to do with the collective mindset of Americans changing as well.
Who do people trust more - the independent and unbiased housing bubble bloggers, the NAR, the REIC or the MSM? Hmmm...
Once people stopped believing in the Ponzi Scheme - and that home prices could drop, the bubble popped, and housing fell off of a cliff. And it won't stop falling until the fundamentals have righted themselves, and rental income covers ownership costs. Oh, and it'll keep falling until people have a certain confidence that it won't keep falling even more.
And as you know, years will go by until that happens...
Lereah said psychological factors account for much of the decline in July home sales.
“We’ve never seen a general decline in the housing market against a healthy economic backdrop where jobs are being created, the economy in growing and interest rates are favorable,” he said.
“Psychological factors are causing some buyers to remain on the sidelines, waiting for prices to stabilize or for more favorable news about the market and the economy. Contributing to this hesitancy is a lot of negative news stories, but in the end we believe that underlying market fundamentals will prevail.”
September 01, 2006
Bubble bloggers victory: NAR devil Lereah blames psychological factors and negative news stories for housing freefall
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Well golly gee, I'd like to buy me a house and all, but 'cause I only slave my days making $40,000 a year I can't near afford anything that ain't falling down. I guess I'll stay in my trailer.
we belive underlying market fundamentals will prevaile
Of course they, will, just not as NAR wants you to believe. Fundamentals are the very thing driving the free fall.
Said: “We’ve never seen a general decline in the housing market against a healthy economic backdrop where jobs are being created, the economy in growing and interest rates are favorable,” he said."
Let's see, most of the jobs they keep bragging about don't pay a living wage, and the average household income in the U.S is only around $40k, versus the outrageous home prices we have in many states. Then we have the fantasic interest rates they keep mentioning, but they also keep failing to disclose that the asset price of the homes has doubled and tripled, or worse, so the interest rate argument is a sham too...
People on the Yahoo Msg boards are still bullish on housing. One guy said that housing downturns never last for more than a few months and that home prices would appreciate at a "slow" rate of 12% per year instead of 50% during the slowdown. I questioned him on the affordability of housing when it increased at those levels while incomes increased at a 2% rate.
holy crap. from businessweek.com cover story, here's quarterly foreclosure numbers from illinois and colorado:
Colorado 9683 10781 10761 12061 10286 15972 16923
Illinois 6152 5184 5436 13619 15555 17559 17060
anyone see a trend?
holy crap.
I work at WlaMart and plan to own 3 houses on the Florida coast and sell them for a 200% profit next year. I'll be retired while you suckers work your asses off
Psychological factors my foot. Mr. Lereah, it was your book and the misinformation you've provided that misled these poor people.
The problem with you is that your illusions overshadow your Phd. The salaries for this new jobs you're talking about is in no way near the price of homes between 2001 & 2005. It really sucks when people don't use their God given intelligence to use it for the greater purpose.
"People on Yahoo Msg boards are still bullish on hosuing."
We're they from - Tin-Buck-To?
fundamentals? FUNDAF*CKINGMENTALS? then I guess that means we get back to when real working people could own houses and rents exceeded ownership costs?
idiot.
A healthy economic background where jobs are being created? For repo men and bankrupcy paralegals maybe.
Whoa Keith, don't panic. There are parts of Colorado that are much worse than others. Care to venture how Boulder is doing? Here's my most recent foreclosure analysis for much of the Boulder/Denver area.
That's a despicable comment from NAR.
thank god for "independent" news sources.
Every source is biased. BUT the little guys (like Keith) are not biased by big dollars that companies (REIC) pays them to tout thier product.
Instead they are biased by thier ability to buy and sell on the markets, which describes my viewpoints perfectly.
THANKS HOUSING PANIC!!!
O.K. then, we were psychologically directed by the realtors and their p.r. firms with the aide of Lereah into our current situation!
Am i wrong, or is he passing the buck already?
Sounds like he must of read Sherry Stuckey
http://www.rgemonitor.com/
blog/roubini/142759
Maybe David Lereah or Sherry Stuckey
can answer a few questions from the last post.
Isn't it a fact that when the Yuan is pegged to the Dollar it is keeping the price of imported goods from China down and not up?
Isn't it a fact that when the Yuan is pegged to the Dollar it is exporting more US manufacturing base jobs oversea due to the low operating cost of Chinese labor?
Isn't it a fact that as USA enter electric day on November 7, 2006 more and more politicians will demand that China float the Yuan so that it give the voters the image that the politicians are trying to protect the voters' jobs.
Isn't it a fact that if the Yuan were to float freely then the US dollar will become weaker, because the Yuan has been kept artificially low?
Isn't it a fact that the US Administration talks about floating the Yuan but truly wants the Yuan to be pegged to the dollar to keep inflation down?
Isn't it a fact that the US dollar is the reserve currency of the world and at least 65% of all world commodities are traded in term of US dollars?
Isn't it a fact that when the US dollar becomes weaker then it will bring the price of imported commodities like crude oil up, because Oil rich foreigners like the Middle Easterners who accept a weaker US dollar for their crude oil won’t be able to buy the same European goods when they exchange the weaker US dollar for Euro. Thus oil rich foreigners will have to raise the price of their crude oil to compensate for the weaker dollar.
Isn’t it a fact that when crude oil price increase it will increases inflation from a wholesale level?
Isn't it a fact that the Federal Reserve has been raising Fed Fund rate in the past 18 months to strengthen the US dollar to bring down inflation.
Isn't it a fact that when foreign bond investors buy US treasury they must change their currency to US dollar first?
Isn’t it a fact that if a foreign currency like the Yuan were trading eight Yuan to one US dollar during the purchase of the US bond then the Yuan were trading seven Yuan to one US dollar when US bond maturity then that bond investors will lose more money then what the yield of the US treasury is worth? Case Study: During the purchase time of the US treasury the Yuan was trading eight to one exchange rate. Thus 8000-Yuan convert to $1000 US dollar to buy $1000 US Treasury bond at 4.76% will get $1047.6 US dollar end of one year. At maturity if the exchange rate is seven to one then $1047.6 US dollar will equal 7322-yuan.
Isn’t it a fact that foreign bond investors lose money when dollar gets weaker relative to their currency; therefore, their risk should come with a higher reward of higher yields during time of inflation?
Isn't it a fact that when bond investors sell US treasury then the price of US treasury will fall?
Isn't it a fact that when US treasury price fall then yield on US treasury will move up?
Isn't it a fact that if the US dollar were to weaken quickly then more and more bond investors will pull out of US treasury bonds?
Isn't it a fact that the job of the US Federal reserve is to protect the US bond market and ultimately protect the US dollar as the reserve currency of the world?
Isn't it a fact that the US treasury bond are rated AAA because it is backed by the fact that the US dollar is the reserve currency of the world?
Isn't it a fact that when the yields on the US treasury bond moves up more bond investors will move money into US treasury bond instead of Mortgage Back Security when the spread on the yields between the two are low? In other words bond investors can lower their risk?
Isn't it a fact that Mortgage Back Security is competing for the same pool of investors as US treasury? Then therefore in that situation the yields on Mortgage Back Security will have to more up.
Isn't it a fact that the yield on Mortgage Back Security is directly related to the yield of mortgage loan?
Isn’t it a fact that as Fed fund rate increase Lenders will try to keep yield on mortgage loan down to gets more qualified buyers? In other words, Lenders can make up lost profit on the lower yield of a loan through increase volume of homebuyers. Don’t that statement sounds like 2003 to 2005.
Isn’t it a fact that currently Lenders ability to make a profit on the money Lenders have borrowed and what Lenders are loaning it for is no longer as profitable?
Isn’t it a fact that as the Lenders profitability decreases the Lender willingness’ to take risk decrease?
Isn’t it a fact that as profitability decrease lending standard becomes higher also?
Isn't it a fact that when lending standard become higher it becomes harder and harder for homebuyers to get a loan.
Isn't it a fact that house demand is based on the availabilities qualifies homebuyers and not by people who want to buy a home but do not qualified?
Isn't it a fact that when the availability of qualified homebuyers decrease then the inventory of house increases if the same amounts of home sellers are available?
Isn't it a fact that as inventory of house for sell increase then the supply will eventually outnumber the demands from available qualified homebuyers?
Isn’t it a fact that when the supply of houses outnumbers the demand of qualified homebuyers then prices of house will fall?
Lets not forget all of the "Pent up Sales" just waiting to jump back in!
Sky said:"Most of the wall street wags say there will be a soft landing for housing and the economy- so the markets are up and will rise next week-premature thinking"?
I noticed that also. Very premature thinking...The sheeple marketmakers believe housing will stablize(upcoming election) Unfortunitely it will not, and Gold should be resuming its upward trend.
It's a tense weekend for Intel employees
10,000 LAYOFFS EXPECTED TO BE ANNOUNCED TUESDAY
By Dean Takahashi
Mercury News
It's going to be a long and nervous weekend for Intel's employees.
The Santa Clara chip giant is expected to announce layoffs Tuesday that could number in the thousands. Chief Executive Paul Otellini has scheduled a Webcast with employees for that afternoon to discuss the results of Intel's ongoing efficiency analysis.
``We hear that it is close to 10,000 layoffs,'' said Ashok Kumar, an analyst at Raymond James. ``They may also say something about writing down excess inventory and dealing with unprofitable businesses. That is what Wall Street is expecting.''
This is like Rumsfeld and Bush blaming
the media for the Iraq war failure.
Yeah, its the TV's fault. And of course,
this ignores all the endless cheerleading
that went on (both for RE and the war).
TV cuts both ways. People want to see
red, even if its their own...
-El Maha
Don't forget about the
Federal Reserve and their
part in all of this.
First of all, the Fed
knew exactly where the
money was going. Alan
Greenspan endorsed the
shabby new lending
regime that put hundreds
of billions of dollars
in the hands of people
who never should have
qualified for mortgages.
They were set up to fail
just like the victims in
the stock market scam who
kept dumping their life
savings in the NASDAQ when
PE's were shooting
through the stratosphere.
Secondly, the Fed knew
that wages had actually
regressed (2.3%) since
Bush took office, so
they knew that the soaring
value of real estate was
entirely predicated on debt
not real wealth. In other
words, home values increased
because of the availability
of cheap money, which
inevitably creates a
buying frenzy. It had
nothing to do with real
demand or growth in wages.
And thirdly, according
to the Fed's own figures,
“the total amount of
residential housing
wealth in the US just
about doubled between
1999 and 2006, up from
$10.4 trillion to $20.4
trillion.”
http://www.dissidentvoice.org/
Sept06/Whitney01.htm
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