January 01, 2008

Feeling 1929?

I don't know where all of this ends up, but when credit dries up, when an epic financial bubble unwinds, and when the banks fail...

Is this Great Unwinding going to be truly different this time? Or have we been down this road before?



47 comments:

Anonymous said...

Here in Riverside, the housing market is dead. Retail business is sluggish, and the city, county, and school districts are bracing for a slash in funding ( property taxes, sales tax, federal and state funds). The Inland Empire is entering an economic reversal of fortune.

While returning some gifts at a major mall, I asked a 19 year old retail clerk how business was. He went on to tell me how terrible the economy was and that sales are extremely low for this time of year. He told me the mood was somber amongst shoppers and he listened to many tragic stories.

The recession is picking up steam in this area!!!!

Happy New Year everybody.

Anonymous said...

Yep a depression is here. Like it was in the summer. Like it was last year. Like it was 2 years ago.

KEEF = Lawrence Yun's evil twin when it comes to predictions.

Stuck in So Pa said...

I was talking to a recently elected county board of supervisors member, and he told me that some revenues are off by more that 50% over last fiscal year, and we are only half way through (fiscal year runs July 1 to July 1.) State matching contributions are down accordingly. This isn't a bubble area, but lots of denial about the financial direction of the area, county, and country, and the existing homeowner is still screwed. Property taxes will skyrocket for those homeowners left standing, to make up the difference, since the "pigs at the trough" are not about to take a financial hit on their soooooo richly deserved salaries, benefit packages, and gold plated pensions.

It's going to get nasty for everyone!

Anonymous said...

So what is your point Mr. Hayes?

Anonymous said...

Steve said:
I live in Riverside Co. as well and went to several malls here and in San Diego over the holidays and the crowds were down but the malls were still very crowded. However I made a point to look at all registers as I walked by and the tills were not ringing and people were not carring bags. I had not said word one about my choice to cut back on Xmas spending (by about 30%)this year to anyone and yet all my friends and family had come to the same descision.

That said I still say the Gov. will report a 2-3% INCREASE year over year and Wall Street will revel.

How many others cut back on spending this year? How much did you cut back?

Edgar said...

If a depression comes then the people will revolt and vote for a regime change.

Anonymous said...

In the 2004 tsunami, when the ocean drew back, the smart people ran for the hills while the stupid ones ran onto the beach. What are you panicking about? I don't see any water on the beach. How could anyone drown?

When it comes, it will be fast and furious.

Mark in San Diego said...

I did a "bag count" also at the crowded malls, and it wasn't good. . ."alls I know" (As they say in Canton, OH) is that there are 3,000 more homes on the MLS here in SD today than they same day last year, and 6,000 more than in January 2005 - total today 20,300. . .prices are down an "official" 15% from 2005 peak, and likely to go down another 10 to 15% this year. . .factor in the "official" 3% inflation for two years, and we already will have our 30% decline in San Diego prices.

These things take years to play out, and just because we don't have a depression today doesn't mean it isn't a slow train wreck coming. . .remember the old saying, "if you neighbor is out of work it is a recession, if you are out of work it is a depression."

Best for 2008 HP'ers

bubbleglum said...

My granddad worked at a small town bank in the midwest when the Depression hit. His bank had to close its doors for good despite being in relatively sound financial shape. The panic withdrawals did it in. Gramps probably didn't think that would happen in a million years. And certainly not in Happyburg, Nebraska.

But it's different now, because:

A: We're a lot smarter now than they were.

B: The FDIC will save us all.

C: People nowadays know a lot more about surviving hard times.

D: Everyone has a wad of cash saved up for just such a disaster.

E: If we keep saying it won't happen, it won't.

Mark in San Diego said...

BTW - My pick for best YouTube video for 2007 is DEFAULTING http://youtube.com/watch?v=vkBgX61Y2_c

Dude can't sing, but I just watched it again, and laughed my ass off. . .

Edgar said...

Viva la revolucion!

Viva Chavez!

Anonymous said...

I don't think we will be living in shacks as there are 17 million empty homes in America. If bad comes to worse, there will be alot of squatting. People will be living in homes for free next door to people who paid $800,000 in 2005.

Kenduffelsniffenspotzen said...

Anonymous Anonymous said...
Yep a depression is here. Like it was in the summer. Like it was last year. Like it was 2 years ago..... 4:57 PM
------------------------------------
You should be here in the Upper Midwest. Our depression started way back in 2000.

Edgar said...

You should be here in the Upper Midwest. Our depression started way back in 2000.

We've been in a depression since 1976, welcome to the party pal. Ready for a change yet? Oust the rethugs!

Anonymous said...

Good analogy with the Tsunami description!
I really do think that is exactly how it will play out.

Most people have no idea how much the lending environment is tightening on top of all the defaluts headed our way with all the Alt A Arms resetting...Prices are going to go lower than we ever could have predicted....

Mark my word, and save that cash!!

Reddy Watt said...

Ahh Ha! I finally figured out why I keep getting video not available on the YouTube links.

This one doesn't work:

http://youtube.com/watch?v=vkbgx61y2_c

This one does:

http://youtube.com/watch?v=vkBgX61Y2_c

The links are case sensitive.

Anonymous said...

Oh yes, it is 1929 all over again. And anyone who disagrees with the gloom and doom financial scenario is insulted/name called upon by most members on this forum by being called "a sheep", "a sheeple", "a turd", "stupid", etc.... Wow, so much for having an open debate and frank discussion. I see two broad spectrum 's here; on the one side, there are the Lawrence Yun's of the world who predict endless prosperity, and on the other side there are people like Keith who think the financial system will collapse. Keith has about as much credibility as Lawrence Yun. I will bet when this year closes out and next year comes, there won't be a Great Depression, there won't be an economic tsunami and life will go on!

Andrew from Russia said...

How about the Spring 1930 "recovery"?

wc said...

I don't think the depression is quite here yet. There are plenty of people with savings that could make it through a depression but many, many people at work would be in big trouble if they lost their jobs and couldn't get another. Few people seem to be good savers today. As an aside - Macy's was open today as was the mall - I was armed with a $15 off coupon and another 10% for using their credit card - the place was dead empty at 2:00. There were some cars in the parking lot but they must have been employees because customers were far and few between and yet I still couldn't get anyone to help me. I can't imagine it was worthwhile for any of them to be open today. Some good bargains out there though.

Anonymous said...

Depression? Where is the depression? I live in Fort Worth, Tx and they just discovered all the gas and oils in the Barnett Shale. Property values have been going up and up with all these gas leases and bonuses going around. County and city govts. are raking in all the money. I guess you can say it is different here, hehehe.

Anonymous said...

Mr. Hayes' point is oft quoted by Rush Limbaugh:

The typical viewpoint of liberals would be shown in the newspaper headlines as follows:

WORLD TO END! WOMEN, CHILDREN AND MINORITIES HARDEST HIT!

Anonymous said...

Proof that the Phoenix area is an ugly place. This is a picture of a "beauty queen" from Arizona:

http://tinyurl.com/2ryduk

If that thing won a beauty pageant, they need to go ahead and nuke the entire southern half of the state.

Anonymous said...

Depression? Where is the depression? I live in Fort Worth, Tx and they just discovered all the gas and oils in the Barnett Shale.

Most people get about $500/mo in royalties and that's only if they have the mineral rights to the property They also need to be on several acres because you cannot drill in somebody's backyard due to the risk of an explosion, which happened just last year. If only they could discover NG in everyone's backyard, then the economy can be saved. You're right about Texas being ok, but that's only because property values DID NOT go up like they did in Clownifornia and Floriduh. We're still in the top 5 in foreclosures though, thanks to the morons who used ARMs to buy big ugly McMansions they couldn't afford.

Anonymous said...


We've been in a depression since 1976, welcome to the party pal. Ready for a change yet? Oust the rethugs!


Ha what an idiot. Decession since 1976? That's when Peanut Brain Carter became President and the DemoCraps were in full control of both houses of Congress. I suppose you think Hitlary or BaaCrock Obama will save the Midwest?

Benjamin Franklin said...

Funny, as I could walk out of my house today with a camcorder and record video footage that depicts the kind of poverty and despair on faces as seen in those Depression-era videos. On the other hand, I could drive to the other side of town and record people living in mansions, fancy cars, etc.

The thing to realize is that not everyone was broke in the Depression! Some people emerged wealthier than before, sometimes immensely so!

Don't forget that many of these brokers, real estate agents, specuvestors, etc. who fueled and serviced the Great Land Rush of 1999-2006 also timed and planned their exits, and cashed out their fake run-up in equity!

Same goes for those homeowners who benefitted from the run-up in market value by selling at the right time, without realizing what fueled the run-up.

My girlfriend (a nurse) pocketed $120k in capital gains by selling her place in 2005 (which she bought in 2003). Just realize that amount of profit pales compared to what the agents and brokers who were pulling $1-10 Mil a year during the heyday of the boom made!

Just saying, this little run-up in prices made alot of people wealthy with EZ money... Alot of people are still sitting on a healthy mound of fake run-up in equity (and it's all theoretical if they plan on keeping the house AND can still make their monthly mortgage payments).

So don't get the idea that everyone will be sleeping by a bridge, under an overpass, because of the market turning... It'll most likely be those who foolishly pushed aside affordability concerns to get their "piece of the pie" before it vanished for good, and/or banked on real estate as a "can't lose money" proposition.

HOWEVER, the funniest sign I've seen of the market downturn is a thread over at mortgage lenders forum, where people are discussing ways to make ends meet and ways to save money while on hard times:

http://tinyurl.com/2xr79g

If that's not a sure sign, I don't know what is! Funny, as only a year ago we had alot of these permabulls who'd denied there would EVER be a need for such a thread on the board, since they were raking it in at the time (as well as apparently spending like the party would go on forever).

Anonymous said...

North Dallas here. We seem to be an island in the sea of despair. We have our fair share of foreclosures and 30K millionaire debt slaves, but prices were stable over the past decade and the cost of living is very low compared to much of the country. I read that when retail outlets tried to raise prices, Dallas was the only market in which they were successful.

We wanted to move a few years ago, but when we did the math and saw how hard it would be to save money in any other large market, we stayed put.

Anonymous said...

What am I to do with all the $$ I've saved if the Banks are going to go bad anyway?

Stuff the $$ in my mattress?

How (Where) can I find out about how "good" my Bank is??

Edgar said...

I suppose you think Hitlary or BaaCrock Obama will save the Midwest?

I would vote for Hugo Chavez or an extremist islam cleric before I vote for another rethug. They are hideous.

Anonymous said...


I would vote for Hugo Chavez or an extremist islam cleric before I vote for another rethug. They are hideous.


Which shows the stupidity and low IQ of the DemoCraps

Anonymous said...

edgar allen idiot = bitteridiot

two socialist losers with nothing to show for. only complete losers and deadbeats want socialism. look at the loser realtors and bankers begging for socialist government intervention.

TM said...

Oh yes, it is 1929 all over again. And anyone who disagrees with the gloom and doom financial scenario is insulted/name called upon by most members on this forum by being called "a sheep", "a sheeple", "a turd", "stupid", etc...

Shut up, you stupid turd! Hah, sorry, couldn't resist. Seriously, though, lay out a sound argument against a worst-case scenario and let it stand on it's own merit. Of course people will call you names, that's what they do when they have any sort of anonymity. But if time proves you right, no name-calling will be able to refute that.

Anonymous said...

1929? BWA HA HA HA.

Asian stocks start off the year with huge run. US stocks will do the same this morning. Wasn't the dow supposed to be at 5000 by now? What happened?

In December it was the conspiracy that Wall St was pumping up the numbers for their year end bonus. What is it now? The magic tooth fairy is in on it? Santa? The Easter bunny? Jesus?

Face it morons, you are dead wrong. You have been predicting doom and gloom ever since 1998 when your Y2K fantasies started appearing. Every year or two you have another reason why the end of the world is here. And every time nothing happens.

Housing is no different. We survived the .com crash and 9/11 within 1 year of each other. I think a housing recession will be quite manageable as well.

Adolf Hitler said...

Edgar said...
If a depression comes then the people will revolt and vote for a regime change.

January 01, 2008 5:46 PM

Hlajmar Schact 1933

Anonymous said...

Face it morons, you are dead wrong. You have been predicting doom and gloom ever since 1998 when your Y2K fantasies started appearing. Every year or two you have another reason why the end of the world is here. And every time nothing happens.

NOTHING HAPPENS? I guess if youre braindead then you can say that. But thinking people know that weve been in a collapse for years.
Shipping your jobs off to China is a reflection of this collapse. I could name countless others- HMO's, Welfare reform, the stripping of the auto industry by hedge funds et.al.

This country doesnt produce enough to meet it's own needs let alone a surplus.

Nothing happens, my arse. You just havent hit bottom yet you moron.

Anonymous said...

Housing is no different. We survived the .com crash and 9/11 within 1 year of each other. I think a housing recession will be quite manageable as well.

January 02, 2008 12:36 PM

Is that you Mr. Greenspan? I am so honored and comforted by your great economic expertise.

Rhymes With Shunt said...

Asian stocks start off the year with huge run. US stocks will do the same this morning.
----------------------------
Um...NOT!

Anonymous said...

edgar allen idiot = bitteridiot

two socialist losers with nothing to show for. only complete losers and deadbeats want socialism. look at the loser realtors and bankers begging for socialist government intervention.

January 02, 2008 4:00 AM

Look at the idiot that doesnt even know his country's history. Government regulation and protectionism is not socialism you moron.

You guys wont be easy to manipulate during this crash now will you? Should we eliminate government all together and let the "markets" take care of the crisis? That would be the work of real genius.

Anonymous said...

Should we eliminate government all together and let the "markets" take care of the crisis?

The government intervention is what caused this crisis you idiot. Fannie/Freddie buying all of those subprime loans, the Fed lowering rates to 1%, all the RE & debt tax breaks. Now you socialist morons want a bailout for Wall Street. You socialist idiots are what caused the crisis with your "affordability" programs that have driven home prices up to ridiculous levels.

Anonymous said...

It will be a long slow decline like Japan due to government intervention. The US$ will be on par with the Yen and home prices will still be dropping while an orange will cost $40. How does 20 years of staglfation sound to you? Hopefully that will send the illegals packing back to their craphole countries.

FDR said...

The government intervention is what caused this crisis you idiot. Fannie/Freddie buying all of those subprime loans, the Fed lowering rates to 1%, all the RE & debt tax breaks. Now you socialist morons want a bailout for Wall Street. You socialist idiots are what caused the crisis with your "affordability" programs that have driven home prices up to ridiculous levels.

January 02, 2008 4:30 PM

FDR's Fannie Mae was "PRIVATISED" years ago. You do know what that means, dont you? It means it is not a government run institution.

Your poor little brain doesnt even grasp the nature of this crisis. Only Government can resolve the financial collapse which is accelerating with each new day.

Who will declare the system bankrupt? Who will decide how the new system will function? Only government can do this.

Youre worried about a Wall Street bailout? That's highly unlikely seeing as how there is $500 trillion in unpayable debt.

The only real solution is to declare the system bankrupt and freeze the debt until it can be sorted out. And all derivatives bets should be wiped off the books.

Now that is hardly a Wall Street bailout.

PS- youre such an idiot that you dont even know what you mean when you scream "socialism". There are far too many like you. You'll make a good nazi for some Hitler puppet who the Wall Streeters will try and put forth over the coming days. Maybe NYC Mayor Bloomberg will fit the bill as the new Hitler or Hlajmar Schacht?

Anonymous said...

Mark in San Diego said...
BTW - My pick for best YouTube video for 2007 is DEFAULTING http://youtube.com/watch?v=vkBgX61Y2_c

Still laughing. Great!

Alpha_Bear said...

fdr said:

"Who will declare the system bankrupt? Who will decide how the new system will function? Only government can do this."

Nonsense.

I declare the system to be bankrupt. I also declare the American nation to be bankrupt.

The new system shall be 1929 redux, except worse.

If you like your present form of fascism, you'll love what it will be like in just a few short years.

Cheer up, the party is just getting started.

Princess Mononoke said...

**********WOW***********

Anonymous said...


FDR's Fannie Mae was "PRIVATISED" years ago. You do know what that means, dont you? It means it is not a government run institution.


They are GSEs you moron. They have government regulators watching their every move and backing them up with the guarantee of generations of American taxpayers. You are a true idiot. Anyway, the bailout will not be able to save your stupid McMansion from foreclosure. It will only go to pad the bonuses of Wall Street crooks. You are too dumb to realize that.

Anonymous said...

Nazi = National Socialist = liberals

FDR said...

They are GSEs you moron. They have government regulators watching their every move and backing them up with the guarantee of generations of American taxpayers. You are a true idiot. Anyway, the bailout will not be able to save your stupid McMansion from foreclosure. It will only go to pad the bonuses of Wall Street crooks. You are too dumb to realize that.

January 02, 2008 10:53 PM

What regulation are you blabbing about? They've deregulated the entire financial system. They've overturned all the FDR era protection enacted back in the 1930's in order to prevent another depression.

But dont talk to me about government regulators and how Fannie Mae is a government controlled entity. Sure the WS flunkies always like to stick the taxpayers with their debt, that's not anything new.

But tell me again that the Government is responsible for this financial collapse. Youre dead wrong. The real culprits are the idiot populists like you who bought the idea of free trade and de regulation. De regulation and free trade mean NO GOVERNMENT interference.

Anonymous said...

how much did i cut back this year in xmas spending?

usually went to tiffany's and bought my wife a decent piece of jewelry ($500 to $1000). This year bought nothing. no one in family bought antything. xmas was as good as ever. don't think i will ever buy xmas again. the charm of that season is gone. i can remember when it used to give me a certain feeling - no after i was 50 - but no more. it's nothing but the crass commercial thing they always said it was. there's no reason for the damn thing other than commercialization. our new god!! well not new - but becoming apparent to goy like me.