When all is said and done, how big will the Housing Gambler / Failed Bank / Fannie & Freddie bailout be?
A) $0
B) $100 Billion - $500 Billion
C) $500 Billion - $2 Trillion
D) We'll lose count, and the number will shock the world
March 12, 2008
HousingPANIC Stupid Question of the Day
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58 comments:
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Probably too big to count. If it takes $500B, it will be $500B. If it takes $5T it will be $5T. There will be no limit imposed, not in an election year. And not when Hillary and Obama are tripping over each other on who will spend the most on what.
Which is why I am saying fuck it and will buy a house in the near future. It is obvious the government will not allow prices to self correct. If my tax dollars are going to be spent artifically propping up house prices, I want a piece of the action.
A good video to watch to get a grasp on why the fed is out of control was done by Aaron Russo, check it out, it's free:
Google Video: Freedom to Fascism
$500 Billion - $2 Trillion
He just dropped FAT MAN and LITTLE BOY all in one load, what a Ahole, thanks Ben..... you jerk.
Keith,
The Fed hasnt bailed out anyone and he will not bail out anyone.
The 200 billion are loans for 28 days dude. LOANS.
As Mish said on his blog today, 200 billion is a drop in a bucket.
Danny
In an economy hit hard by a housing crisis, out-of-work construction workers are pawning their tools and equipment.
Can you spare a fellow American a billion dollars?
Later...
Can you spare a fellow American a billion dollars?
Ed,
The first poster. You buy a home and you will regret it.
The Fed can only make you think that he will not let prices self correct.
Answer this than: how the hell can most americans afford a home? There are 2 answers.
1 - Deflate, houses will loose their value and come back to reality.
2 - Inflate, houses retain value, while everything else is inflated, including salaries. Salaries catch up and most will be able to afford again.
I used to be a believe in # 2, but after reading and reading, there is just no way that the Fed can stop the deflation force thats now prevailing. He will try, but will fail This mess is just to freaking HUGE.
Danny
We're already above 2 tril.
Question: is eleventy gazillion a number?
Because if it is that's what I'll go with.
Seriously though, they will need to use scientific notation before this cluster f$%^ is done.
The bailout will be too large to count, and it does not matter anyway. Ben knows that we have a cross-current of inflation and deflation, He can completely trash the dollar with impunity because it all washes out in the fake government statstics. The only people that get hurt are the HPers who have savings. Savers are f*cked.
2 - Inflate, houses retain value, while everything else is inflated, including salaries. Salaries catch up and most will be able to afford again.
You can inflate prices of goods, but you can't inflate salaries in a global economy.
The only people that get hurt are the HPers who have savings. Savers are f*cked.
That's why you have to invest in the right commodities, currencies, and companies. Then hope that Obama doesn't tax the crap out of you because he already said he will raise taxes on capital gains back to 40% to pay for the free healthcare and college tuition.
too large to count, and still won't work. what comes after trillion?
"The Fed hasnt bailed out anyone and he will not bail out anyone. The 200 billion are loans for 28 days dude. LOANS."
Yeah, just like the payday loans taken out by $7/hr dumb asses who roll them over and fall farther in debt every month. We laugh at their stupidity and pity the hopelessness of their situation. But when Bernanke is the guy at the loan window, Wall Street cheers as money center banks do the same thing?
Let's face it, Ben's bosses are Wall Street, that's all he worries about. The reason - 401ks. He'll prop the stock market up to 14,000 so 401ks are solid to the expense of the rest of the issues - dollar, commodities, oil etc. We'll have our 401ks, they just won't be worth squat when we're paying 6 a gallon for gas and 5 dollars for a gallon of milk.
White House Press Secretary not allowed to speak about the dollar
http://www.liveleak.com/view?i=573_1205177533
"You can inflate prices of goods, but you can't inflate salaries in a global economy."
--------------------
Here is one way to inflate YOUR OWN salary:
Find another job - one that pays more.
Otherwise, you are likely stuck in a rut with minimal annual 'cost of living' pay increases, which in reality are now not keeping up with the cost of living.
-Mammoth
Somewhere at the upper limit of B and possibly in the lower limit of C.
I say a minimum of $3 Trillion in financial losses and write offs related to the housing market alone.
Then you have to add in the tens to hundreds of trillions in derivitives tied to the housing market.
The problem is much, much too big for the government to bail out. That is why they will fail.
Jymkata
The option of buying all the CDO's out there is on the table according to the Financial Times. . .If this happens, it still would not have much of an impact on housing prices, it would just transfer the losses to the government and continue to take the dollar down. . .on the ground, people don't care who ownes their mortgage - if they can't afford the loan, or the price of the home is underwater, they walk! Our wonderful local company here in SD County - youwalkaway.com, is being swamped by customers. . .they are adding staff daily. . .
>> what comes after trillion?
Revolution.
E) The bailout will be so huge, the U.S. dollar will DEFAULT against its obligations to other countries (which is our government's plan in the first place), and so the actual number will be unmeasurable, meaningless, and irrelevant.
Which is why I am saying fuck it and will buy a house in the near future. It is obvious the government will not allow prices to self correct.
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that 200B has little to do with whether or not a J6P that makes 50 grand can afford a 1/2 Million dollar house.
inflated, including salaries. Salaries catch up and most will be able to afford again.
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NEVER NEVER NEVER going to happen. Most employers are increasing the burden of health care %'s to the pay checks of their workers. That equates to a DEfaltion of wages.
Here you go again with the "roaring inflation" thing.
Oh, by the way, last time I looked at Money Supply figures they were negative.
I thought Ben was printing money and dumping it out of helicopters.
??????
Care to explain that?
I thought not.
Because he ain't....
Oh and if inflation is "roaring" at 8+ percent, like you all say, then by now housing has returned to its historical trend. That is unless Shiller's inflation adjustments are bogus too...
SO you all should be out shopping for real estate bargains now.
Pathetic idiots......
(except for "Danny" who gets it)
Little life lesson for you liberals. I know you don't want to hear this but it be da truph!
I work in a field that interacts with the poor and destitute. With my own eyes, I see how these people take care of themselves. Let us not kid our selves, they can go to the county hospital and have the tax payers foot the bill already, but they don't.
I truly believe that universal health will BANKRUPT this country (if it's not already). You cannot have MILLIONS of people who NEVER went to a hospital before all of a sudden flood the system for every little ache and pain.
You will never know the true number. The people in charge are lying rats and will hide the umbers.
You will know something is wrong by all the inflation in necessities while your life savings slowly evaporates. But most will be unable to connect the drop in living standards to the Fed and the failure Geroge Bush.
We are all paying for the failed flippers and greedy RE industry.
They are taking us all down.
Bastards!
I think this quote expresses much of the angst that Hp'ers have with the debt whores of America (and just about anywhere else for that matter). Lifted this from bigpicture.
Home Equity Loans
"This product was meant to help people do construction on their house, [and] do debt consolidation -- not to take out every last dollar of equity in their home to finance a different kind of lifestyle."
-Charles Scharf, head of J.P. Morgan's retail business.
Don't be too hard on BB.
I think he's committed
to a strong Penny.
(as long as it has some copper)
We are lacking secure and well-paying jobs in this country *outside* of the public sector.
As long as this is the case, no housing or bank bail-out will do any good.
"5 dollars for a gallon of milk"
A few months ago, I paid $5 for a gallon of milk at Safeway. Inflation is a right biatch!
BEN IS GONNA RIP OFF SAVERS AGAIN THIS MONTH MORE.........
D - $2 trillion plus.
But is it really $2 trillion if the dollar is essentially worthless?
Germany circa 1922. Who would've thought it here?
Oil prices hit a record $110 a barrel Wednesday afternoon, despite inventory report showing a big rise in supply.
Mission Accomplished!
Signed,
Bush & Cheney
PS: You voted for us TWICE. Don't come crying now, suckers.
Anonymous failure said:
You can inflate prices of goods, but you can't inflate salaries in a global economy.
Ummmm...of course you can? By doing that, you just end up lowering the value of your currency, duh. That's the whole point.
If I make $100K and my house is 500K, that hurts to pay.
If I make 200K, then 500K is alot easier since it stays the same. Sure, other commodities/items will be more expensive, but at that level it's not so bad, you know? Yeah, the poor get screwed and savings get owned, it happens. But look at the statistics: for most people their home is their largest asset by far.
in that photo Ben looks like a poster child for bearsandleather.com, don't go there, by the way. you've been warned.
By SHANNON BEHNKEN, The Tampa Tribune
Published: March 11, 2008
Updated: 03/10/2008 09:46 pm
TAMPA - For the past three years, the developers of Trump Tower Tampa searched coast to coast for a lender willing to finance the $300 million luxury condominium.
Now, after being turned down by numerous traditional lenders and 10 hedge funds, they're poised to walk away and sell the waterfront site along Ashley Drive in downtown Tampa, the project's developer says.
It should be $0, but it will probably be closer to $∞ (that's an infinity symbol if you can't make it out).
The Japanese are still digging out of their experience with a housing bubble 15 years ago. I don't think we are going to see quite such an extreme revaluation (e.g. commercial real estate in Ginza valued at 1/100th of the peak), but it should be noted that land value in some areas is roughly 1/3rd of what it was 15 years ago.
Ouch.
And to the poster decrying Obama's 40% tax rate: Our taxes are going to have to go up no matter who is President. How do you think McCain is going to be pay for the 100-year-Iraq-war (or the first 5 years of it conducted under Bush for that matter)? Please tell me another stimulus package, because that first one worked sooo well.
Here is one way to inflate YOUR OWN salary:
Find another job - one that pays more.
Some people can do that, but how is the entire country going to change jobs for higher pay? The current average salary is what it is. If everyone got a raise, the cost of everything would go up by the same amount.
stupid homedebtor said:
Ummmm...of course you can? By doing that, you just end up lowering the value of your currency, duh. That's the whole point.
If I make $100K and my house is 500K, that hurts to pay.
If I make 200K, then 500K is alot easier since it stays the same
Just because the dollar crashes by 50% doesn't mean employers will give their workers a 100% raise. Why don't you go to your boss and ask for a 100% raise due to inflation?
Obama will freeze food and energy prices just like Venezuela and Zimbabwe. Then we can all stand in line since there will be a shortage of everything.
Yep, that fake rally was a total dead cat bounce. Now back to reality, trolls. Back to losing your shirts on the rigged stock market, while being a mortgage slave to Arab bankers.
Those trolls are not so upbeat today, eh?
Huge nosedive coming up soon to erase all that fake rally from yesterday. That blip was just to fleece the sheep, like DOPES!
I'd like to share a revelation that I've had during my time here. It came to me when I tried to classify your species and I realized that you're not actually mammals. We have three types of idiots, who are true financial imbeciles, hanging around here at HP:
1. The retards who believed in the house ownership (the Arab banker owns, really) scam.
2. The life-failures who keep investing in the stock market lows and listening to Cramer.
3. The low IQ who doesn't believe that 9-11 was an inside job.
Most of these types are Republicans, Baby Boomers, and are up to the wazoo in debt. But Gen Y doesn't get too far behind, as they've proven to be as dumbass as their Baby Boomer failures they call for parents, by bending over to Mr. Empty Suit Obama like sissy girls in love. It was on Myspace and Youtube, so it must be true and cool for me to be a clone! The rappers are endorsing him, so it must be good! Cramer and Kudlow vomited, so I'll swallow it to look smart at the water cooler!
No wonder this country is going down fast. Now go wave your Made-In-China flags and pay $5 for gas to your master Arabs who french-kiss the president you voted for. C'mon now, go on, be the obedient hamster you are.
Yeah, the poor get screwed and savings get owned, it happens. But look at the statistics: for most people their home is their largest asset by far.
Not so fast, my naive & blindly optimistic friend:
Fewer new American millionaires
Report says the number of U.S. millionaires grew at its slowest rate since 2003 last year.
NEW YORK (CNN) -- The number of American households worth $1 million or more - not including the house itself - grew at the lowest rate in five years, according to a report released Wednesday.
"We had already tracked a steady decline in millionaires' investment optimism since mid-2007 on a variety of concerns including a slowing economy, rising energy costs and poor stock market conditions," said George Walper Jr., Spectrem Group president. "It now appears those concerns have become a reality for the wealthiest tiers of the U.S. population."
Still drinking the Almighty-Superpower-Best Nation In the World-God Is American-So Is Jesus Kool-Aid, eh?
BEN IS GONNA RIP OFF SAVERS AGAIN THIS MONTH MORE.........
Not savers who listened to HP for years, as we told everyone to sell the cancer house, follow Schiff's book, to invest in precious metals and foreign currencies, and get the hell out of dollar.
I hope you're not trying to include those savers. We told you so wayyyy in advance; don't come trying to include us now with your financial failures. Lots of HP'ers are breezing through. Enjoy.
the answer is "c" - $1 trillion or more.
House prices will correct sooner or later. If politicians & the Fed keep messing with it we're talking about later like in 10 years or so. If they let the market take care of things it will be sooner, like in 2 years or so. In the end prices will fall, depending on local, 0-60%.
Isn't it great when lenders do their job and don't give loans to developers (using the Trump name)?
To bad lenders didn't turn down more developers or ask them to pay more of the tab .The planning departments didn't turn down the developers ,so the lenders just had to . Course they would of just tried to raise private capital for over-priced Condos we don't need.
But concerning the amount of the loss from this housing bust ,I think the loss will be the greatest for the middle/middle upper class of America. Taxes will be greater in the future ,inflation will be higher ,buying power will go down ,while the gamblers and crooked real estate industry gets off the hook .It's to bad that there won't be any real Justice because this baby is to big . When people see that Justice is meaningless to Feds and Congress and Senators etc, and crime and greed is rewarded ,the entire Country will take one more step downward into the darkness.
"Getting a new job that pays better" is not wage inflation. That is called getting a higher paying job, kinda like buying a bigger house or eating at more expensive restaurants.
Wage inflation means your boss gives you a 10% raise because inflation was 5%, and you earned the other 5% for your hard work. Wage inflation is not possible when an Indian Subsidiary can do the work you do for pennies on the dollar compared to your salary. So you take your 2% raise and are happy to still have a job, while milk & bread prices skyrocket.
If I make 200K, then 500K is alot easier since it stays the same. Sure, other commodities/items will be more expensive, but at that level it's not so bad, you know? Yeah, the poor get screwed and savings get owned, it happens. But look at the statistics: for most people their home is their largest asset by far.
Oh. So you are anticipating your salary doubling in the near term? Really? And that logic makes sense to you?
My friend, as the other poster aluded to, we are in a global economy. Wages did not keep up with inflation over the past 7 years. Companies are expanding to cheaper markets and keeping domestic wages stagnant. So don't be looking for that 'amazing raise' anytime soon.
And being that house prices (and rents) ALWAYS corrolate with wages, you will see a correction in prices of the former. (And the latter in some of the overvalued rental markets)
Well beyond 2 trillion when the wheels really come off. What I don't understand is how these banks are going to recoup their losses in a mere 28 days and repay their loans when no one wants to borrow. Hey I know, buy gold this week, sell after Bernanke cuts next week and causes gold to go well over 1,000. Seriously, I can't wait until you see gold make a one day move like the Dow did on Tuesday. Probably before summer.
"And to the poster decrying Obama's 40% tax rate: Our taxes are going to have to go up no matter who is President. "
Sure thing genius. The economy is faltering, credit markets are frozen, and unemployment is on the rise. So let's ice the cake with a tax hike on workers! Can you spell D-E-P-R-E-S-S-I-O-N?
Do us all a favor - please don't vote.
"Wage inflation is not possible when an Indian Subsidiary can do the work you do for pennies on the dollar compared to your salary."
In 2001 the selling point was that an Indian cost 20% of an American. In 2005 it was about 80%. Today companies are not seeing any advantage in India at all and are moving operations to the Philippines and to a lesser extent China. Companies started figuring out that a language barrier costs money.
Some companies have even decided that offshoring is a waste and are bringing jobs back, or are working with what is called "onshore offshore" companies - comparatively compensated management leading interns or newbies who work for cheap.
I hope these facts help ease the pain in your day...or if not, to prompt you to go learn about something before you repeat what your drinking buddies blather to you.
Anon March 12, 2008 8:27 PM:
I must be one of those imbeciles you were referring to. Was your outburst of 20-something cliches followed by a reference to others as hamsters intentional irony?
The answer is that you will never know the answer for certain. All gubbermint statistics are lies. The S&L crisis cost taxpayers approx. $400 billion in 1990 dollars. Revisionist history puts the total at $125 billion. This mess is easily ten times bigger. I say $4 T total public cost, $1.25 T reported as final tally.
Why don't the Bankers just take out a long term loan with the Feds or sell shares of stock . This idea that the taxpayers pay for all this folly ,especially when the banks made a lot of profits for years ,is just not fair . I am getting sick of the economy being contorted for the purpose of saving banks and gambler borrowers.
About 500-700B in losses.
Most of those will be eaten by banks. They've already recognized 200B.
In actual cost to the gov't...maybe 100B for bailing out FNM/FRE.
Anonymous said...
Well beyond 2 trillion when the wheels really come off. What I don't understand is how these banks are going to recoup their losses in a mere 28 days and repay their loans when no one wants to borrow. Hey I know, buy gold this week, sell after Bernanke cuts next week and causes gold to go well over 1,000. Seriously, I can't wait until you see gold make a one day move like the Dow did on Tuesday. Probably before summer.
March 12, 2008 11:31 PM
It was loaned to cover the MASSIVE margin calls coming due March 24. I still think it will be end game by then and the 200B ain't gonna do shit...
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