February 27, 2007

Cheney almost bites it. China stocks drop 10%. Dow tanking. Subprime in meltdown. NAR puts out bogus report.

Interesting day so far, eh?

The Corrupt David Lereah, on today's bogus NAR numbers:

"For the last several months I have been hemming and hawing on whether we have reached bottom," said David Lereah, chief economist for the Realtors. He said that the January report was an encouraging sign that the bottom for sales activity was reached last September with sales expected to stabilize this year.

China and US action:

Stocks Slide after China Sell-Off - Shanghai's major index dropped 8.8%, prompting equity weakness worldwide. Investors were also spooked by a big drop in durable goods orders. In early trading, the Dow Jones industrial average fell 131.14 points, or 1.04%, to 12,501.12

China Stocks Post Biggest Drop in Decade - China Stocks Fall 8.8 Percent, Sending Ripples Through Markets From Hong Kong to Singapore

Cheney takes refuge in shelter after Afghan blast

U.S. Vice President Dick Cheney was whisked into a bomb shelter immediately after a Taliban suicide bomber struck the main American military base he was visiting in Afghanistan on Tuesday.

Mortgage finance company Freddie Mac will no longer buy subprime mortgages that have a "high likelihood" of payment shock and foreclosure, the company announced Tuesday.


Anonymous said...
This comment has been removed by a blog administrator.
Bill said...

When the Margin calls you better have your cash ready..or a cardboard box will be you roof. We are trully fucked and the ones who say we are not are the ones leading the way for sure.


Anonymous said...

NAR puts out bogus report?

Go figure!

Anonymous said...

Man, the lender stocks bounced back but are now slowly getting strangled.

Why would anyone would buy at a time like this? I have an idea that some of it might be misguided, automated computer trading thinking this is a normal day and these dips are temporary.

tmaioli said...

Trigger Levels

The revised Exchange rules establish new circuit breaker trigger levels for a one-day decline of 10%, 20%, and 30% of the DJIA.

These levels will be calculated at the beginning of each calendar quarter using the average closing value of the DJIA for the previous month to establish specific point values for the quarter. (See note 16 of the SEC's release for a description of how this information will be disseminated.)

Each trigger will be rounded to the nearest 50 points.

Trading Halts
Under the new rules, trading on the Exchanges will be halted as follows:

1. Before 2:00 pm Eastern Time, the halt for a 10% decline will be one hour. At or after 2:00 pm but before 2:30 pm, the halt will be for one-half hour. If the 10% trigger value is reached at or after 2:30 pm, the market will not halt at the 10% level and will continue trading.

2. The halt for a 20% decline will be two hours if triggered before 1:00 pm. At or after 1:00 pm, but before 2:00 pm, the halt will be for one hour. If the 20% decline occurs at or after 2:00 pm, trading will halt for the remainder of the day.

3. If the market declines by 30% at any time, trading will be halted for the remainder of the day.

Smart Grid blogger said...

FREDDIE is out of Subprime loans ...

this means no more interest-only loans to Un-affordable hot housing market areas !!!

This will result to further DECLINE IN HOME SALES AND HOME PRICES !!!!

RipeDurian said...

"As I hem and haw I cross my fingers and toes real hard so that the blood supply is cut off from my digits, this makes it less painful as I chew my finger and toenails down to the bone, but you see this is required because otherwise as I nervously scratch myself constantly while I hem and haw I would open up soars all over my body, of course I still have to figure out how to stop pulling out my hair in clumpy tufts, oh when oh when will we reach the bottom?"

David Liarreah, chief king real estate clerk during the most hugest meltdown of housing in the history of the world, gosh things were so nice for a while now they are total shit and I've got to lie and lie and lie.

Bill said...

Mr.Liarreah is that your nose growing or are you happy to see me?

RipeDurian said...

"Freddie Mac... announces it will NO LONGER buy subprime mortgages."



Anonymous said...

Hope this is only the tip of the iceberg and we experience such a severe correction that "rivers of blood flow thru the streets", to use an old economic metaphor, All this hyped, bloated scum, living on borrowed time and money, will be crawling away like cucarachas to the nearest Wal-Mart anchored stucco ghetto. Foreclosed squatting trash and Wal-Mart proles will be the new members of the underclass.

Bill said...

Fed Says Real-Estate Loan Delinquencies Reach Four-Year High

-- The Federal Reserve said that delinquency rates on banks' residential real-estate loans climbed last quarter to the highest level in four years.

The share of the loans on which payments were at least 30 days overdue rose to 2.11 percent, the highest since the fourth quarter of 2002, from 1.72 percent the previous three months, according to data posted on the Fed's Web site today. The data aren't adjusted for seasonal patterns.

The deteriorating credit quality comes in a period of strong economic growth and employment gains, a sign that weaker underwriting standards, not economic stress, may be behind the problem.

The economy expanded at a 3.5 percent annual rate last quarter, and is forecast to grow 2.7 percent this year, according to the median estimate in a Bloomberg News survey. The unemployment rate stood at 4.6 percent in January, near a five- year low.

( yup it has to be the credit worthy not the fucking Toxic loans that have been delt out the last 4 years ..no not that )

Anonymous said...

Toyota to build plant in MS...2000 new jobs. This will be Toyota's 5th plant in the US and of course the Toyota design center in California.

So next time you morons cry about GM laying off people, remember it's because GM makes shit cars. Toyota makes good cars. Nobody wants GM cars, lots of people want Toyotas. Toyota hires people, GM lays off people.

Anonymous said...

Watch this spins and bogus reporting:

Economic Report: U.S. existing-home sales rise 3% in January
12:27 PM ET, Feb 27, 2007 - By Rex Nutting - 1 hour ago

U.S. Jan. existing-home sales down 4.3% year-on-year
10:00 AM ET, Feb 27, 2007 - 3 hours ago

U.S. Jan. existing-home sales 'surprisingly strong': NAR
10:00 AM ET, Feb 27, 2007 - 3 hours ago

U.S. Jan. existing-home sales up 3% to 6.46 mln vs. 6.27 mln
10:00 AM ET, Feb 27, 2007 - 3 hours ago

U.S. Jan. existing-home sales rise 3% to 6.46 million
10:00 AM ET, Feb 27, 2007 - By Rex Nutting - 3 hours ago

Marketwatch got to figure out what is going on here !


tmaioli said...


Home prices fall most in 14 years

Housing values are up 0.4% in past year

By Rex Nutting, MarketWatch
Last Update: 12:33 PM ET Feb 27, 2007

WASHINGTON (MarketWatch) -- U.S. home prices fell 0.7% in the fourth quarter, the fastest rate since 1992, and are up just 0.4% in the past year, Standard & Poor's reported Tuesday in the inaugural release of the national Case-Shiller price index.
A year ago, home prices were rising 14.6% year-over-year.
"Annual changes in home prices are either in decline, flat or yielding negative returns across all markets," said Robert J. Shiller, chief economist at MacroMarkets LLC, which produces the index for S&P. "All metro areas are showing smaller annual returns than those reported for November."
"Given the overhang of supply and clear signs of deceleration in home prices, we continue to expect a nationwide home price decline of about 3% in 2007," Goldman Sachs economists wrote in a research note. They called the Case-Shiller index "probably the highest-quality measure of home prices."
Home prices in the top 10 metro areas fell 0.8% in December, the largest monthly drop since 1991. Prices in the 10 cities are unchanged for the year.
Home prices in the 20 metro areas fell 0.7% in December, the largest decline in the seven year history of the index. Prices in the 20 cities are up 0.5% in the past year.
On an inflation-adjusted basis, national home prices are down 1.6% in the past year. Prices in the 10 cities are down 2% and prices in the 20 cities are down 1.5%.
Nominal prices in 18 of 20 cities fell in the fourth quarter compared with the third. Only Seattle and Portland managed gains. Nine of the 20 cities showed lower prices at the end of the year than at the beginning: Detroit, Boston, San Diego, Washington, Cleveland, San Francisco, Minneapolis, Denver and New York.
Among the 20 cities, the biggest gains in the past year were in Seattle (up 12.1%), Portland (up 9.9%) and Charlotte (up 6.7%). The biggest losses in the past year were recorded in Detroit (down 5.9%), Boston (down 5.1%) and San Diego (down 4.2%.
Prices had been rising at unprecedented double-digit rates during the housing boom in 2003 to early 2006.
In other reports, the National Association of Realtors reported sales of existing homes rose 3% in January. See full story.
Orders for durable goods fell 7.8% in January, the Commerce Department reported. See full story.
Also, consumer confidence rose to a 51/2-year high in January, the Conference Board reported. See full story.
How Case-Shiller works
The Case-Shiller indexes attempt to overcome flaws in other measures of home prices by comparing actual arms-length transactions on the same single-family home. New homes and condos are excluded.
Median prices for new and existing homes can be affected by the mix of homes sold. For instance, if relatively more homes are sold in high-priced markets, the median sales price would show an increase even though actual value of any particular home would not have changed.
The quarterly price index reported by the Office of Federal Housing Enterprise Oversight also compares price changes for the same homes, but only covers homes with mortgages that conform to Fannie Mae and Freddie Mac limits, currently $417,000 or less. In addition, the OFHEO index includes mortgage refinancings that are valued by an appraiser, not the market.
The latest OFHEO index showed prices had risen 7.7% year-on-year through the third quarter. For purchases only, the OFHEO index was up 6% year-on-year, the lowest in seven years. Fourth-quarter data will be released Thursday.
Other price indexes are based on the homes sold in a particuarl period. The median price of a new home was down 1.5% year-on-year through December. The median price of an existing single-family home was down 3.1% in the 12 months ending in January. End of Story
Rex Nutting is Washington bureau chief of MarketWatch.

Anonymous said...

Freddie Mac will no longer buy subprime mortgages that have a "high likelihood" of payment shock and foreclosure, the company announced Tuesday.


Opened the barn door. Cows running free. Hmmmm, ok, NOW we close the barn door.

Anonymous said...

OK, the credibility of a blog can be judged on its ability to stand by its assumptions and comments. I too believe we are not at the bottom, but what is the actual evidence that the NAR is printing BS? Could it not be the warm weather in 12/06 leading to contracts in 1/07? Or are we just assuming that he is a lying snake therefore the numbers must be cooked? I believe many look to housing panic as a decent barometer, but that said, I'd like to see some legitimate discussion around why the existing sales numbers are bogus. (please.)

Anonymous said...

It wasn't for lack of warning from this blog. We told everyone to short the market. My short on MTG is really coming along nice.

Anonymous said...

Welcome to the Abyss!!

Anonymous said...

Dow down over 500 points and gold following down over $20 on margin liquidation.

Buy gold stocks. They are cheap and are only down due to fund liquidation in the metal to cover margin calls in the equities.

You heard it here first folks.

Anonymous said...

DOW just went down 500 points.

Anonymous said...

Attn: David Lerah...
The way you KNOW we have hit bottom is that prices have dropped and stayed down for at least the same duration as the run ap and have began to go up again.

It will happen during the coming recession while your membership is screaming for you to do somthing.

It is difficult for you to be in touch with the market or economy because you are so insulated from reality by your salary, your social callendar, and your advisors.

Anonymous said...


This is not 1987. A 500 DOW drop out of 12,700 is not that big a deal.

I sold out about 60% of my equities on Monday seeing a slight pullback was coming. About an hour ago I jumped right back in at about 5% cheaper than what I sold on Monday and already everything is slightly up.

Anonymous said...

Isn't anybody gonna crow about being short today? Fuck, I thought I was safe stuffing some money into the Japanese market this week. I got my ass handed to me. Standing by with cash in hand to jump in to staunch the haemorrhage, might have to wait a while for the buying opportunities...

Just hope my gold holds the line at 600. It is screaming toward the 660 resistance line as we speak and looks like it will blow through it. Ouch. This will be a rocky ride guys, hang on.

Anonymous said...

Turn out the lights the party is oveeeeer!!!

Anonymous said...

What will be interesting is to see which hedge funds will soon be sending their members letters...

GrandInquisitor said...
This comment has been removed by a blog administrator.
Anonymous said...

The stock market is rigged like the rest of this game. You don't see any triggers to prevent the market from going up a certain amount do you?

Anonymous said...

the most hugest meltdown of housing

most hugest? Yet one more tell of the lack of education among the renters here.

Anonymous said...

Gold and Oil also down....

Marky Mark

Anonymous said...

Why is the NAR report bogus?

YOY Inventory up 23.9%
MOM Inventory up 2.9%

YOY Price down 3.1%
MOM Price down 5.0%

YOY Unit Sales down 4.3%
MOM Unit Sales up 3.0%

Almost everything seems bearish to me. Only the MOM sales units are up and that seems to be the number that the media is fixed on. The interpretation of the data might be bogus but not the numbers.

Anonymous said...

Liareah hemming and hawing about a bottom? That's a laugher.

Dick Cheney whisked to a shelter after the attack? So much for military intelligence. Can we declare victory and go home yet?

BlackberryVault.com said...

Here is a great depiction of the current market.


Detachable Cletus said...

The best part of the Chinese crash is I didn't hear about an oscar winner or the dead playmate chick all day.

I think thats a pretty good return on a $117 Billion investment.

Anonymous said...

Completely off topic but a tidbit of real life vs. MSM. We live in the Bay Area and this morning I was waiting in a little coffee shop next to a Home Depot "Supply", this is the place that sells primarily to contractors. The parking lot was an ocean of empty asphalt, I actually had to look twice to make sure the place was open for business. Bear in mind, I waited for the better part of an hour reading the paper and finishing my coffee. Ghost town.

Anonymous said...

Keith is a Drama Queen ... Drama Queen ... Drama Queen ...

Waiting for the big financial collapse, you remind me of Pat Robertson waiting for Y2K ... which disaster never materialized.

If the disaster strikes, you won't know it beforehand.

Sure, NAR is going to be biased. Housing is going through a slowdown.

But waiting for the implosion ... just ain't going to happen. They have a lot of market controls now and it isn't in anybody's best interest to have global instability.

WhiteTower said...

You know, this is so exciting, living through the housing meltdown. Even the tech/dot.com meltdown in 2000 wasn't covered this well -- by bloggers, I mean.

In 2000 there really wasn't an internet blogging community where you could go for commentary, news stories, and quickly relay info to others. You had to rely on the stupid MSM. In many ways, most people didn't know what happened until it happened.

Now, it's like being the captain of the Carpathia watching the lights of the Titanic twinkle out in the distance.

Anonymous said...

DOW closed down 400+ points. The slaughter is only beginning. There will be a slight bounce, but be ready to short away.

Anonymous said...

I pleasured myself to the sell-off today.

Anonymous said...

Ok, relax everyone, 'many economists' say recession unlikely in 2007.


Isn't it just kinda comical when you see yahoo sloshing out whatever kind of bilge they think is required at the moment, for the consuming masses.

You KNOW they think we're a bunch of tools the way they just throw whatever shit is at hand like they're old mcdonald feeding the swine.

And the only thing that's more remarkable, is that it IS consumed. Listen up at work tomorrow. You're gonna hear someone say "But you know... many economists say a recession is unlikely in 2007" (or some deviation of this), and they'll say it with authority.

Now I don't know if there will be a recession or not. Actually I hope there isn't. My hope is that somehow housing can get back to being affordable without a recession, if that's possible.

But it's amusing to watch them pulling the levers.

The Thinker said...

The DOW just tanked. The party is over. The global financial meltdown has begun. This George Bush recession will be the worst downturn since... well... since the last George Bush recession of the early 90s.

Anonymous said...

I don't know how to say this tactfully, so I won't even try to soft-sell this.

We are witnessing, in real time, right now, the complete collapse of the fraudulent financial system as we know it.

Sorry gang, but the jig is up.

If you haven't already:

1. Switched out of your 401(k)/IRA and gone to straight U.S. treasuries via Treasuty Direct

2. Yanked a couple grand out of your bank

3. Bought gold and silver

4. Sold your house and NOT signed off on another suicide mortgage

5. Gotten yourself completely out of debt

6. Bought guns, bullets, food and water...

Well then, you are screwed.

The hedge funds are melting down.

They can't meet their margin calls.

The $400 trillion derivatives market is seizing up.

The mortgage market is ALREADY frozen cold and dead in its tracks.

Our debt enablers have stopped funding the U.S. deficits.

The dollar is tanking.

Worldwide stock markets are crashing.

War with Iran is "on the deck".

What more do you need to know?

It's been a fun party. It really has.

But now it's rapidly ending.

And we will all pay the price in this "Great Depression II".

Anonymous said...


It's not a total collapse at all. My lender puts are well into the money but I didn't cash them all out today. I think it's going to be worse tomorrow. Fremont (FMT) just announced that it was postponing reporting tomorrow. Hahaha! That's really bad news for them which is good for me.

The only bad thing was gold and gold stocks were the biggest losers today and I was heavy up into them.

I'll be loading up on gold and silver as soon as the bottom is in.

Anonymous said...

Jeezuz you people are insane, literally insane if you think this is anything more than a 1 or 2 days hickup. Look back to the last 4 or 5 days like today (3-5% drops) and then look where the market was 3 months later.

Anonymous said...

If you haven't already:

1. Switched out of your 401(k)/IRA and gone to straight U.S. treasuries via Treasuty Direct

2. Yanked a couple grand out of your bank

3. Bought gold and silver

4. Sold your house and NOT signed off on another suicide mortgage

5. Gotten yourself completely out of debt

6. Bought guns, bullets, food and water...

Well then, you are screwed.

Uhm wasn't this the advice we got pre-Y2K? If HP had been around in 1999 you'd all be predicting the end of civilization and linking on "how to build a bomb shelter" blogs.

I knew this one tool at work who bought 500 gallons of water and something like 1000 batteries. Wouldn't surprise me if he is a regular here.

Anonymous said...

Hey trashwacker. I love your "wal-mart anchored stucco ghetto" may I use that and pawn it as my own?

Anonymous said...

here we go again... Socialist Walmart Obession

you people need to chill out IT'S A FUCKING STORE!!

Shakster said...

The Y2k thing was plastered all over the media for years,and touted as impending doom.The state of world economies is completely hidden from view by the Big media,and replaced with a sugar coated parade of shills.That Be a major dfference.Who the hell knows what will happen,but the base that shoulders the load of the Banking world is broke,tired,and has it all already.We have little to offer the world in trade for their goods except to crunch their numbers ,and take a fee.The world is lost financially,and at best is no more than a hoard of gamblers betting the hardways on house credit.Everyone is sleepy now,and wants to rest(save money).This is contraction,and is the last thing the Banks,CBs,and government wants to face up to.We will make,and in the end you will actually know your neighbors name.

Anonymous said...

no really, wal-mart normally anchors itself into establishing neighborhoods. That's a compliment.

Wal-marts are good economic indicators. If a wal-mart is being built, then you know it creates jobs or goes where the demand for cheap china made product is. Do you not think that wal-mart spends a lot of money on demographic studies? I think so. Therefore "wal-mart anchored stucco ghettos" is absolutely spot on.

Roccman said...
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tmaioli said...

Another 300 point plus drop tomorrow. There will be some Government Spin, don't believe it by Friday they will be talking about the worst week since 9/11 if not ever.

The margins calls are already being made.

Anonymous said...

Of course, Casey still thinks it all about himself!
hey kieth,

Did Casey write you an email asking why you didn't list his troubles right above "Subprime meltdown," and just below "China stocks drop 10%" ?


Anonymous said...

Tke Y2k thing caused the dot-com bubble, in a way. The fact that the y2k thing didn't materialize, contributed to the stock market crash.

blogger said...

Of course January was higher than December, as it always is. It's called seasonality. And the media falls for it.

January was DOWN 4.6% from last January. That's the real headline.

But in the end the numbers are totally bogus and error-filled anyway. Having the NAR report home sales is like having a dictator report voting results