February 03, 2008

We interrupt this blog for a very important message for the people of Europe

People of Europe, with your crappy falling apart $1 million apartments that would rent out for a fraction of the cost of "owning", you have no idea how f*cked you are.

It was the Brits - they came into your market and bid up the prices to unjustified and unsustainable levels, in a big giant European Housing Ponzi Scheme. And you fell for it. In America, the Californians were our Brits. And you know how that turned out.

And now back to our regularly scheduled programming.


Anonymous said...

HMM... not as bad as some areas here in the states-6x earnings at peak? we had many markets at 10x - same markets currently at 7-7.5 times and heading to mean (3x earnings) id say these chaps are well ahead of the U.S. on sorting their market out.


Anonymous said...

Yes, those Europeans are truly f*cked. F*cking SOCIALISTS! Nothing like a good dose of BRIT CAPITALISM to teach 'em a lesson!

Anonymous said...


Anonymous said...

Yes, we Europeans are so screwed. I am catching the first plane out to America. What do I need to bring with me? Ah yes, I have compiled a list

1) I cant fully speak the language of your country, but I'll bring along a Spanish dictionary which will help me get around just fine.

2.) I dont have a dollar to my name. But I do have Euros. What is the going rate now? Two dollars for every Euro? I guess I have just doubled my net worth by coming over!!!

3) Should I pack a semi-automatic or are the AK-47's in style there? And what color weapon is most fashionable when you drive in da hood?

4) How many credit cards should I apply for and max out before I can be considered a true blooded American citizen?

5) Leaving Europe means I will not be getting my six weeks vacation anymore. But I want to work hard for 14 hours a day, six days out of the week for meager wages. After all, isnt that what Abraham Lincoln died for when he "abolished" slavery?

Anonymous said...

Many are expecting the British Pound to fall as rates need to be cut, London cap rates are 3% maybe less, and as you know just like NYC its run by finance bonus money which is starting to become more scare this year with more tame bonuses, the financial bubble is over. Sell the Pound is an idea.

Buzz Saw said...

They really are effed so much worse than we. In America you just toss the keys into the bushes and walk away. In the UK they put you on the rack if you don't pay.

Stuck in So Pa said...

When that graph comes down the other side after this run up, it looks like it will fall off the page, if history is any indicator.

Russ DoGG said...

About diversifying currency holdings..

The Us dollar lost value at an accelerated pace when the US housing crash came into full view.

The pound is now down substantially against the dollar and other currencies. The housing market there has noticeably cooled- to say the least. Does anyone expect the euro to lose value as the housing crash spreads through spain? And how susceptible is France, Germany to this housing bubble?

That is my biggest concern about diversifying into other (euro) currencies, that they are poised to lose value. That the euro might lose value when the ponzi scheme in europe unravels.

So you could lose money first from the devalued dollar, then switch into euros and then see that currency lose value next. You would sustain a adouble hit!

This situation sucks because you really have to be aware of events just to preserve the buying power of your personal savings- and I have another job to do in the real economy.

Anonymous said...

At least you can give up your Koran when you come over.

Anonymous said...

1) Learn Chinese... all English speaking nations are fucked.

2) Trade in your Euros for Singapore dollars.

3) Cash is your weapon not guns.

4) Debt is slavery.

5) 6 weeks vacation is for lazy people.

area 51 said...

This is true, but it undermines Keith's argument for exchanging dollars for other currencies.

Maybe the dollar has bottomed out WRT other currencies, and the pound and euro are going to snap back like rubber bands.

Anon 9:05. Good one.....
And don't forget to scarf on massive amounts of McDonald's and potato chips to gain 200lbs, drop your IQ by 30pts, then you'll fit right in.

Anonymous said...

Wow 9:05. You have a lot of issues. Screw the Europeans, I say, if this is the average attitude. And I'd say that it is given my years spent in London.

Anonymous said...

If 9:05 is from the UK, he doesn't need to change his weight or IQ to fit in, especially if he moves to Alabama.

SeattleMoose said...

From the graph it looks like the roller coaster is just nosing over from the biggest runup for what appears to be a panty wetter of a record run down...

There are many countries for which the overall shape of the graph applies (AUS, POL, UK, ESP, US, etc.)

Time to fly America's secret weapon to prevent the coaster from going down in these countries.....HELICOPTER BEN and HILLARY CLINTON!!!

Anonymous said...

Thank you for admitting that California is the greatest state in the Union. Considering we can make or break a country. Quit trying to find villains in people and find it with greedy companies and aggressive stock holders. Like yourself of course.
I believed all those stories about buy it now or you won't be able to get into the housing game. People were buying because they were thinking a house would be a million dollars in a year or so. Blame ignorance, blame real estate commericals blame the media scare tactics but don't blame California for the fuck up of the entire country. I bought a house in 1991 so I am not in this mess and never planned on using my house to make money but a place I lived and did not have to live by the whim of a landlord or the rules they laid out. So I may rent money from the bank but my walls are yellow and I can hang pictures on the walls and I don't hear from my money landlords unless I don't pay. I don't have to worry about having to move because my rental is being taken back to give to the landlords daughter who needs a place to live.
The reason the people in California charge so much it's a priviledge to live in our great state. And you should he honored to live next to a former true Californian should we decide to leave our fair state and go to yours. True Californians know about housing cost it's all those outsiders who aren't native Californians came in and ruined the market. Phillipino's, Mexicans, Chinese, Asians(others), Middle Eastern People, Africaaners, Japanese anywhere but here. They thought since they lived in California and they were better than everyone else and if this was the cost to brag about living in California as opposed to say S. Dakota then the price was perfect. Actually they thought that the money would come in after the house purchase and it didn't (a California pitfall) Anyway the people only charged what some dummy was willing to pay. If I was 10 years younger I probably would have fallen for it too but I still remember the 1980's housing market crash. They don't.
So explain the massive profits of Exxon, greed, and stock holders oh, yeah, forgot, it's California's fault.

Seniorsavvy said...

Folks, I'm old enough to go back in to the 70s when the word to describe the coming economic collapse of Europe was EuroSclerosis..all over the biz media and econo forums of the time and was young and naive enough to believe it.
Since then I've traveled, worked and lived in those "doomed" countries as well as a few places in the US.
Here's the real story: The Europeans are doing just fine and will continue to do so..quality of life is much better than average American, more security, more stability, stronger societies and families by far, and YES MORE FREEDOM. For the vast numbers of the American masses, a European way of life would be much better..the only people getting over in the USA are the top 10% elite who put the old French aristocracy of the Luises' and Antoinettes' to shame. The American elite political and corporate establishment thru their media owned lackeys are the ones pushing the story that the European system is about to "collapse"...I've been watching, reading and hearing this BS movie for the past 40 years, and Europe is better off than ever since post

shtove said...

Well, Spain and Ireland and the UK looked fewked on housing.

But financiers are really worried about the banking system for the whole contintent - something big is brewing, and it seems to be just on the back of buying toxic American debt, without factoring in domestic toxic debt.

Mind you, the IBer I spoke with about this thinks the ECB is doing nothing - "who cares about inflation when your banking system is in danger" - and that the Fed's interest rate policy is the way to go: "it will stabilise the system within a couple of years, and any deflation will have passed within five years". IBers really do have a lot of faith in the Fed.

Europe smells said...

Something you all must understand about Europe:

Europeans are pretenders and fakers.
European media are more of a propaganda tool than journalism.

People in Europe (Western and Eastern) in general, are content with being uncomfortable on the inside so long that they appear happy on the outside.

If you see Europeans admitting that Housing costs are 6X earnings, rest assured that they are at least 16x earnings.

We may not have a true picture of European economies until things are really bad, and there is no question it’s coming, and soon.

Seniorsavvyer said...


Do you work for the BBC?

or do you just hang out often in Amsterdam?

logic said...

SeattleMoose said...
'I've been watching, reading and hearing this BS movie for the past 40 years, and Europe is better off than ever since post WWII.'

Exactly the reason why its about to come crashing down.
You see, European thinking has not changed at all since pre-WWII.

It is that narrow-minded thinking that brought about their self-destruction of WWII.
What makes you think that this same thinking will have a different outcome, or can possibly bring about individual freedom and prosperity.

Were Europe is now, is as far as they can possibly go, (unless of course they decide to become hospitable and charitable people—slim chance).

There is a connection between, Giving; and having Abundance / Success.
‘American style’
And there is a connection between, Selfishness; and having Scarcity / Self-destruction.
‘European style’

WhatThe said...

UK, Ireland and Spain are f*ucked

Germany is not. Whilst the UK and USA were going thru a housing frenzy Germany was reducing manufacturing costs and becoming an export powerhouse

House prices are lower in Germany than 10 years ago. You can get a great house in Germany for reasonable money - since most Germans rent and they do not think that housing is an 'asset class'

Yoski said...

"Europeans are pretenders and fakers."
You mean kind of like Californians?
"European media are more of a propaganda tool than journalism."
Like FOX?

Seniorsavvy said...

Europe and its citizens will be doing just fine for decades to come while many of you greenhorns on this site will have gone thru a dozen jobs, lacking poor health care options,scrounging a 401k and SS for your retirement at age 80.Meanwhile your brainwashing by the elites in this country will continue unabated, as you think the American standard of living is what everybody aspires to in the world, as only people migrating to this country all the peasant masses of Central/South America and Asia to toil as 21st century serfs.

And no I don't work for the BBC, but if you're wondering about my creds:I was patrolling the jungles of Vietnam and Cambodia and wounded twice, once seriously, while little chickenshit punks like some on this thread, weren't even love-juice trickle on yo mama's inner thighs.
I've lived and seen a world and an America you faggots can't even imagine.
So quit bitching about Europeans,illegals,Muslims, Chinese and assorted foreigners...the people who are selling you out are your own American elite.

Anonymous said...

Europe and Europeans are screwed, especially the Brits. Here's why:

1) socialism and feminism has resulted in few marraiges, sky-rocketing births to unmarried females...which will result in the implosion of the white population. it is already happening.

2) rise of Islam in Europe...it will become Eurabia by 2100 and will look and act like anything remotely Western. This will result in mass emigration to Canada, Australia, and the States (hopefully, our politicians will keep them out).

3) Britain has created the most tyranical surveillance and tracking society with millions of cameras set up everywhere. They even have speakers set up to tell you not to do things, like "Don't cross the street yet" if the surveillance system sees you step off the curb. There is no individualism, liberty, or anonymity there anymore. The Socialist state owns you...everything about you. You are not free, you are a vassal...that's a very European thing and harkens back to it aristocracy.

4) Lazy-ass Europeans can't keep their economies going forever. Six weeks of vacation, not including their govt. holidays will ultimately destroy them...slowly but surely. While things may look ok now for Europe, they are destined to be a backwater civilization by 2050.

5) terrorism will flourish there and the secularists will cower in fear and give them everything they way. it will be a losing battle because eventually the Islamists will cut off their heads.

Enjoy Europe while you can, it will be gone in less than a hundred years.

Anonymous said...

I don't believe this conversation.

happy homeowner in the stix said...

The reason the people in California charge so much it's a priviledge to live in our great state. And you should he honored to live next to a former true Californian should we decide to leave our fair state and go to yours.

Nah, sweetheart, it's a privilege to live in a beautiful place like Hawaii, Alaska or Colorado. Cali's the fifth circle of hell. It can't hold a candle to any of them.

Take it from me....I had to live next to a bunch of "former true Californians" back when I lived in Arizona. It wasn't an honor at all. The constant whining and bitching about how Arizona wasn't just like the people's republic they left behind was aggravating. It would have been an honor to pay their airfare back, but they kept turning down my offers to do just that (dammit).

Get over yourself and your hellhole state.

Anonymous said...

It's time we pulled our troops out of Europe. Those bastards have gotten cocky and arrogant, and now think they can lecture us on how to behave.

We take our boots off their real estate, and they'll have another stupid, fratricidal war in fifteen years, guaranteed.

Look at the former Yugoslavia if you don't believe me. Yeah, the Euros handled that one so well. Oops, sorry. We had to go back in there and clean up *another* European mess, didn't we?

Pull all our troops out, hang out with the Russians on the sidelines and swoop in after you guys finish killing each other off. Only this time, they get France and we get the Czechs.

concerned said...

Add Greece to that list as well. How a nation with a minimum wage of 700 euro a month can have an average apartment (in a middle class suburb, no more than 100 square meters) in Athens priced at 280,000 euros is beyond me. I am considered a high wage earner in Greece, but would not consider buying a house....unlike a lot of people I know.

Construction has slowed and the construction companies have plenty of stock that they are still refusing to lower prices for.....however time is not on their side....bank rates are on their way up, and many will foreclose.

Add credit card and personal loan debt.....and you have a bubble of major proprtions.

Many here are expecting northern Europeans to come over and buy up their 'place in the sun'.......but they don't realise that Spain went through a major bust, and that Europeans are tapped out.

The writing is on the wall in Greece as well....many don't realise it yet, but this year will be a telling year for a lot of people.

Ikanos said...

concerned said:
Add Greece to the list...

I know Greece and Athens extremely well. Its gotten much worse for the majority of Greeks since full EU and euro enrollment. Athens especially, is a poor excuse for a major European capital city, notwithstanding the 2004 Olympics public works.
In my opinion, Athens is the most backwards capital city of EU countries or the most advanced capital city of Africa. A horrible place to live and even visit for no more than 3 days...

DaveO said...

But it's different this time. The recent sharp drop from the peak will stop very soon and level out, resulting in the promised soft landing.

Remember, this is the 21st century. The factors that caused the previous downturns were so 20th century.

concerned said...

Don't overdo it Ikanos. There are plenty of places far worse than Athens. It does some some great suburbs....and some dingy suburbs (particularly one's close to the city center). I have travelled around the rest of Europe, and consider Athens one of the most lively places to live in.

But anyway, getting back to the subject at hand, yes there is gonna be a lot of pain felt when the credit crunch finally hits the shores of the Aegean.

Anonymous said...

careful about europe..those people have been diddling each other for centuries, if not longer ala cromagnum and neanderthal from the pacific to the atlantic, and the royal elite money changers easily get them to civil war cannon fodder and standing in lines to shoot each other.....pardon my high brow euro centric heritages...as somebody stole my machette

Anonymous said...

i think the modern czechs are a better class of people nowdays than the french due to last centuries history and environment, and i have some french linage

corvinus said...

UK, Ireland and Spain are f*ucked

Germany is not. Whilst the UK and USA were going thru a housing frenzy Germany was reducing manufacturing costs and becoming an export powerhouse

House prices are lower in Germany than 10 years ago. You can get a great house in Germany for reasonable money - since most Germans rent and they do not think that housing is an 'asset class'

Ich lerne Deutsch jetzt, und wuerde doch dorthin so frueh wie moeglich gehen. (I am learning German now, and would like to go there as soon as possible.)

Plus, the girls there are among the best in the world. :)

Ikanos said...

Know the "best and desirable" Athens suburbs excruciatingly well...from Ekali,Kefalari,Kifissia up north to further down Paleo Psyhico & Filothei, and south to Glyfada Voula,Vouliagmeni,Panorama and Kavouri. A non-descript sea of tightly packed concrete bunkers and small houses masquerading as "luxury" apartments and "villas" with substandard plumbing and HVAC systems.Narrow streets and the tiniest sidewalks with budget cars parked all over the place, a depressing amount of stray dogs and cats roaming the neighborhoods, and a total lack of any greenery or parks, while air pollution blankets the city.
And to experience this lifestyle, outrageous prices for every conceivable consumer need that makes NYC seem almost cheap and just every other American city a bargain.
Forget about the dollar/euro exchange rate...for Greece based on the value of what you get for your money, you should get 3 euros for every dollar.

LauraVella said...

The bubble here in the US is worse than Europe's for sure. Our is around 10x salary in California. No comparison.

Anonymous said...

Unless you been there shut up. I am in the UK every other week and live in Central Florida. The Brits relocating to CF LOVE IT. Cheaper than socialist Britain and they don't have to deal with all the immigrants that are taking over in the UK. If you think we have it bad, visit and see all the MidEasterners and Africans. My UK friends and I have many times done a balance sheet on life on each side of the ocean. Both sides have positives and negatives. We agree there will be a serious drop in UK housing value and and total collapse of other parts of Europe like Tuscany Region in Italy (another California) Lots of Brits were in Tuscany before Americans learned to spell it. One of my CF neighbors has apt there and lost 10% due to FX alone. It ain't pretty since the locals rip him off all the time. Maintenance and fees = lost wallet.

charlatan said...

They even have speakers set up to tell you not to do things, like "Don't cross the street yet" if the surveillance system sees you step off the curb. There is no individualism, liberty, or anonymity there anymore.

now it is true that speakers have been set up on a trial basis to hassle memebers of the public in such an orwellian manner, but otoh we don't have jaywalking laws here. you can step onto any street that isn't a motorway (interstate). as for liberty and individualism ask yourself why the betting website i use every day to make my living won't allow anyone with an american ip address to bet......the truth is that when it comes to such matters neither country is as free as it ought to be. the main difference is that america is more hypocritical about its commitment to liberty.

one thing i've learned from living both countries is that americans have a very blinkered view of britain and britons have an equally clueless take on america.