July 26, 2007

Why haven't Time or Newsweek put the Housing Crash and Mortgage Meltdown on their covers yet?

It makes absolutely no journalistic or business sense why Time and Newsweek haven't addressed in ANY way the Great Housing Crash yet on their covers or in their editorial, since the reckless and mistimed June 2005 infamous time housing cover.

Britney Spears? Sure. Iraq? Of course. The Presidential race? You got it. And pretty much every other topic under the sun. But for some reason, both of these publications have been completely asleep (and completely incompetent) when it comes to the one subject that personally effects the most amount of their readers - the Housing Crash.

Serious question - Why?

Why aren't the two major news magazines covering the AP's 2006 biggest story of the year? Why aren't they covering the most important financial story in the history of humanity? Why aren't they covering the one story dominating water cooler conversations in America today (besides America's Got Talent of course)?

Are they that incompetent? Or is there another reason?


Anonymous said...

I think the main reason is, they don't want to give HousingPANIC the satisfaction.

Anonymous said...

Media's coverage of an event is typically a contrary indicator. They didn't cover the Housing Bubble, until the bubble was over. And, they probably won't cover the meltdown until we are at or near a bottom.

Anonymous said...

Must be the advertisers?


Anonymous said...

Let's all ask them directly email them letters here



Anonymous said...

Because Journalists stopped doing their jobs years ago

K.W. - Southern Ca. said...

Keith -

It makes perfect sense why Times and Newsweek haven't placed stories about the housing crash on their front pages.

They are in the business of selling magazines, and so many people are in deep denial still,
so the last thing they'll want to read (or choose to accept) are stories about the crash.

Instead, give the people what they *want* to read, instead of what they *should* read.

Anonymous said...

Ron Paul Music Videos.


Anonymous said...

1) big money doesn't want to turn off the spending hose

2) they don't want to piss off advertisers and break the illusion that prosperity and a manly erection is but a mortgage and an iphone away.

3) the editors drank the koolaid and bought overpriced properties, In Places Where It Rilly Is Different Here

4) spoiled stupid readers want feel-good stories to distract them from the feel-bad stories of genocide, torture, rape and all around clusterfuckitude in Iraq

5) the poor bitter renter reporters at the bottom aren't worth bupkis and boot lickers-to-power editors will never give them a chance to crow about being right.

Anonymous said...

are you kidding? and tell their paying readers their #1 asset is going to sh*t?!!! this won't make the front cover until Time starts tripping over the bodies because there's no place left to walk.

David in JAX said...

Time & Newsweek aren't really news magazines any more. I would guess that the majority of their issues end up in doctor's or dentist's offices. I don't know of anyone who actually reads them other than at a doctor's office. Real news magazines like The Economist HAVE been covering the crash.

X-er said...

They don't pick up on things like that until the market is at a turning point.

We'll know that we have hit bottom when they start printing stories about how no-one wants to buy real estate.

Anonymous said...

for the same reason they don't put black helicopters on the cover

Anonymous said...

Housing Market quote of the day:

"We're still on a descending staircase to the basement of the housing market, and I say we have many more steps to go until we get there, maybe by this time next year," said Stuart Hoffman, chief economist for PNC Financial Services Group in Pittsburgh.

--From Wash Post article entitled

Home Sales on a 'Staircase to the Basement' Looks like the "Stairway to Heaven" for something for nothing riches in RE are over!!

Insert callow & shallow realtwhore/troll comment/response here:

Anonymous said...

I hope it's not on their covers for years to come. When it is, that will signal the end of the crash. I want prices to fall much more before that happens.

covered wagon said...

These are some of the best comments ever! "...bootlicker-to-power editors...don't want to break the illusion of prosperity...not newsmagazines anyway..." All of this is true. It's just Oprah-style fluff, "whiter than white...softer than soft...downy-soft, pampers fresh. Oh what a world awaits!

The big W said...

Because they won't get invited to press house dinners if they do.

Osman said...

Here's the question I keep wondering about but for which I can't seem to get an answer.

For over two years, the core HP message has been that because of the housing bubble and bad monetary policies, among other things, the US is entering a long period of higher interest rates, possibly higher taxes, higher priced goods and services (inflation), peak oil, and even further decreasing dollar value. We're losing our competitiveness and as the carry trade unwinds, China stops buying our debt and stops shipping us cheap goods, the US economy will fall under increasing global competitive pressure. The era of cheap credit and cheap goods is ending. There will be a massive correction.

Now, assuming you have job/income security and you don't live in a former bubble city, wouldn't owning a home with a conservative fixed rate mortgage be a hedge? While there may currently be a large gap between the immediate cost of owning and the cost of renting, if HP's predictions become reality, that gap should close very quickly. Payments on a fixed rate mortgage won't rise during an inflationary period, but rent will. If I'm not wrong, rents have already started rising markedly across the board. Is there an argument for long term ownership of a reasonably valued home purchased in a non bubble market with a (still historically low) fixed rate mortgage?

I think so. Your thoughts?

p.s. I see lots of articles in the financial press that deal with whether subprime and housing woes will spread. Maybe not Time and Newsweek as yet, but on any financial news source you'll find many articles. Isolated opinions aside, the general consensus seems to be a lack of conviction that it will spread.

Anonymous said...

Times and Newsweek long since gave up being real news sources. It kind of is like CNN. It is extremely scary to extropolate and look ahead. It seems to me that the editors are in big business thrall.

Anonymous said...


I have been saying the same thing. HP is talking out of both sides. On the one hand they talk about hyperinflation. Then turn around and say housing will fall 80% and a great depression is coming. I could be persuaded that one or the other will happen, but it is impossible for both to happen.

The HP man in general is an uneducated, sloth that bought a Y2K bunker. He is the guy from the movie Falling Down, a paranoid white man about to go off the deep end.

Entertaining, yet dangerous.

Anonymous said...

Most people in this country know they have no recourse against the 'powers that be'...much like the depression when people went to the movies to escape. The more you know, the more depressing it is, so they just HAVE to escape into something mindless like celecbrity BS or whatever idiotic TV show is currently getting a few ratings. I don't blame them, it's just too much to take.

D. said...

Like always they're waiting for the trough!

Anonymous said...

I'm not wrong, rents have already started rising markedly across the board.

I think you're wrong. Rents blipped up for a little bit but haven't gone up again very much, because of the wave of discouraged flippers attempting to rent.

Remember that vacancy rate is at a major high. That doesn't translate to across the board rent increases.

We'll see massive inflation in energy and food (the same thing, really), medicine and insurance.

Propably general deflation in housing---except in close-in areas to major cities with good services and employment.

The higher gas prices rise the more valuable the close-commuting distances will be over exurban McHell. f

Speaking about oil:

Did you see the very quiet report on the Mexican oil/gas pipeline sabotage? This is something really big.

It was very professional. The bombers knew exactly which side of these massive steel transfer points to blow up, they knew exactly which nodes to take out to remove the most redundancy and disrupt the greatest inflow to refineries.

This is NOT something you learn by watching videos of chanting dudes with Kalishnikovs.

I don't think subcommande Marcos (Zapatista) could do this without some serious help.

By the way, Mexico's largest oil field (Cantarell, second only to Saudi Arabia's titan Ghawar) is crashing in production. Just like Britain's North Sea oil fields have been crashing in production despite the input of the maximum Western oil company technology. U.K. is now an oil importer but 5 years out from being a major oil exporter.

Peak Oil nonsense? Vladimir and Hugo have us by the nuts.

Sofia said...

Dear Osman,

It has been quite some time since you have graced us with your presence. I hope all is well with you and I must say that you are a credit to your profession.

While I get the point you are trying to make I can think of a few possible outcomes that may derail your logic.

1) I don't think rents will rise significantly due to the fact that there is simply too much excess capacity at this point in time. In fact the CEO of KB Home even discussed this during their last conference call when he said the typical sales price premium a new home had over an existing home had dissolved due to the fact that builders simply added too much inventory during the past few years. He went on to say that it will be quite some time before the inventory levels come down. Until then what would be the major catalyst to spark an increase in rents? Sure some former FB's will have to rent but their #'s aren't enough to put upward pressure on rents in a material way. At least in my humble opinion.

2)While some HP readers think we are headed towards an inflationary or even a Weimar like hyper-inflationary environment I happen to feel that the dreaded D-word is a very real possibility. That's right I'm talking about Deflation. I mean c'mon do you think it was an accident that Bernanke beat out Feldstein for the gig as Fed Chairman? And if we are moving towards a deflationary environment then a fixed rate mortgage would no longer be a hedge but a liability.

3) Subprime woes will not be contained and will spread to Alt-A and eventually Prime. That's because Subprime was never the problem, just a symptom. Face it, we as a nation had a collective binge on cheap debt and eventually we'll have to deal with the hangover. Did you catch that little story on the front page of today's WSJ about the fact that nobody wants to buy the Chrysler debt that Cerberus and their bankers are trying to sell? Did you catch Greenspan's funny response a few weeks ago when a reporter asked him what would happen if China decided to dump their treasuries? Greenspan responded, "who are they going to sell them to?"

Think about it.

Budvar said...

OSMAN said.."Now, assuming you have job/income security and you don't live in a former bubble city"

With the dow leveraged at about 200:1, do you think there'll actually be such a thing very shortly?
This lunacy will all unravel in very short order, and welcome to Weimarica, $37trillion bread anyone?

As to your question of paying off the house in inflated $s, it didn't work like that, yes they paid of the mortgage, but once things settled down, they had the shit taxed out of them, and as for rents rising, the rents were capped very early on.

Zimbabwe, the bread basket of Africa, more mineral wealth than most 1st world countries now has an inflation rate of 1800%.
A NYTimes article said "A chart on Tuesday with an article about Zimbabwe's high inflation rate misstated the reasons for its sharp rise and fall during 2004. The rise was caused by a flight of foreign capital, shortages and a steep increase in the money supply, not by the government's seizure of commercial farms. The fall was caused by a rise in interest rates and an economic slowdown, not by price controls.

Full article here. http://tinyurl.com/3yaxdv

Can't happen here, the USofA is a world power, not some 3rd world shithole?
Yes so was Weimar Germany 4 years prior to the crash, you may remember it as the Austro-Hungarian Empire.

bobbyg said...

Actually, I have been thinking the same thing and I believe your analysis is valid. The key is will the depreciation of the asset be less on an NPV basis than the savings in owning versus renting. If you are in a non-bubble area than owning will a low fix rate mortgage will clearly make more sense than renting.

We all know that owning a home has been a traditional hedge against inflation because the loan (a fixed rate liability) would be deflating on a real basis as the cost of money increases.

My view is that all paths now lead to hyperinflation in the long term. The US cannot pay its long term fixed liabilities so it will steal wealth from its citizens via stealth inflation. So paying a fixed liability with cheaper dollars in the future is always a good strategy.

Anonymous said...

LauraVella said: Waiting until next summer when it will be obvious to everyone, and too late to get out!

Flagg707 said...

The time to consider buying again is when Time and Newsweek put out a cover stating that "Property Ownership is Dead".

borkafatty said...

Because the Editors most likely have ARMS!

Kenduffelsniffenspotzen said...

"It makes absolutely no journalistic or business sense why Time and Newsweek haven't addressed in ANY way the Great Housing Crash yet on their covers or in their editorial, since the reckless and mistimed June 2005 infamous time housing cover."
I found out a long time ago that advertisers call the shots. Publishers can't afford to piss off their advertisers, nor the big money.

Anonymous said...

You gotta go contrarian with the MSM.

They called the top with that cover.

They'll call the bottom too declaring real estate dead forever. Just watch, mark my words.

MSM is like that. Clueless.

Anonymous said...

This is true regarding the water cooler- it is all use "younger" folks talk about at work, that is, those 40 and under who cannot afford a home here in DC. The best thing is, none of us will buy and all plan on moving out of the area unless things drop 50%

morgan said...

havent you heard? Bloggers have no credibility - we're just chicken littles. Foreclosure is a small problem in the scheme of things. Median home price is up, inventory down - apparently us bloggers are making a story out of a non-issue. END SARCASM

Anonymous said...

Why haven't they covered the layoffs and divison closings of the national builders?

Anonymous said...

To busy showing Obama's ears!

Gore as the new saviour!

Hillary's thick ankles!

Global warming hype!

Corporate profits!

Bashing Creation!

Is spanking (your child) o.k.?

Britney, Linsey, Paris.....?

Michael Moores latest rantings!

yada yada yada

blah blah blah

Anonymous said...

Time and Newsweek haven't been serious news publications since the 80s. When I was in high school in the 80s, my father subscribed to Time, so I read it regularly. I was amazed to compare the level of the writing then to what appeared in old copies from the 40s-50s, which I sometimes read on microfilm when I researched subjects for history papers, etc. The quality of the magazines - be it in terms of language, of depth of analysis, of the subjects they choose to cover - had declined noticeably by then, and it's now even worse.

These publications appeal to the average American who doesn't want to think too hard about anything. That's why they offer up cover-page stories on Jesus, or on cholesterol, or on Mormons, or on other superficial subjects that have nothing to do with real news. I started subscribing to the Economist in college and never looked back - and that mag has been running consistent coverage on the global housing bubble/bust for years now.

bickerer said...

Makeing the covers indicates a peak. When the crash is on the cover it may well be time to buy.

That ain't yet.

Anonymous said...


You make some good points, but I think you're fighting the last war here.

We are in completely uncharted territory here. Debt and leverage are at unprecedented levels compared to any time in this nation's history.

When you talk about getting a 30 year fixed loan, it makes sense. Unfortunately, prices are so out of wack in so many parts of this country that:
a) People couldn't afford the 30 year fixed mortgage, so they chose a toxic mortgage instead.
b) Prices are going up, but wages are stagnanat and haven't moved up (adjusted for inflation) in 30 years.

You are lucky to live in such a desirable town like Boulder. If you own a home in Boulder, double kudos to you. Your town has been able to defy what's happening in every other front range town in Colorado right now. However, I don't think that's going to last forever.

The average home price in Boulder is $500,000. A 30 year fixed mortgage at 6.47% (got this from CBS Marketwatch) gives you a monthly payment of $3,150 not including taxes and insurance!

Using the 33% rule, you would have to have an annual income of $114,545 to realistically afford that house! An average house in Boulder requires an income level that the top 5% of the population can afford?!? And I don't even want to talk about those 2 bedroom lofts down on Pearl Street going for $1.5 million (WTF)?

Last year I saw an ad for Creekside apartments where I lived when I was going to school in Boulder in 1991. In 1991 the rent on a 3 br apartment was $750/month. Last year the rent on the same apartment was $1250/month. I crunched some numbers and calculated that the rents had increased by about 3% a year over the past 15 years, yet house prices have tripled in value during that same time period?

It doesn't make sense, Osman. The prices are disconnected from the fundamentals! I want to buy in Boulder, but I will not do so until prices come down substantially!

CU later,

Anonymous said...

When the bottom's in then the major MSM will cover the "news" about the blood in the street. Hopefully, we will all be phlush enough with cash to take advantage of some penny on the dollar deals.

Mark said...

The MSM is still feeding the delusion that the 2005 real estate market will be back any minute now. Here is an excerpt from an article in today's Orlando Sentinel. It's shmucks like this guy Kelley who convince sellers their houses are worth the ridiculous prices they are asking.

"The slowdown in home sales has rippled through the local economy as well as statewide and nationally, but for Orlando, the long-term outlook is good, said Mike Kelley, sales manager in the Orlando office of HomeBanc Mortgage Corp.

"A lot of this is just psychology," Kelley said of the sales slowdown. "People are concerned and kind of sitting on the fence."

Kelley said his staff works to help Realtors nudge people off the fence by showing them hard data indicating that they can usually sell their existing home at a nice profit even after cutting their asking price -- and still upgrade to a more expensive home.

Most homes in the Orlando area, he said, have gone up about 70 percent in value since 2002, or about 14 percent a year, providing a significant return on their investment, the down payment. While the median sales price is down about 3 percent in Metro Orlando during the past year, that's across the board, Kelley said, so buyers on average are getting better deals on homes they purchase."

Shakster's Black Helicopter said...

I was thinking , maybe I should get another Black Helicopter,HMMMMMMMMMMMMNNNNN.My tin hat collection is extensive already.
Fun to buzz MOZERO.HEHE

armed said...

I believe the proper term is (help me if I am wrong) collusion.

Anonymous said...

Not sure why they haven't covered the crash,but when they have a headline saying "How much lower can real estate go" Its time to buy.