I have heard elsewhere that a bank repo counts as a "sale" because it is recorded as such by the goverment after the bank wins the auction against no one. Then when sold to a human being, it is yet another "sale".
If true, maybe home "sales" won't be so bad this year!
I have heard elsewhere that a bank repo counts as a "sale" because it is recorded as such by the goverment after the bank wins the auction against no one. Then when sold to a human being, it is yet another "sale".
CR where do you get these quotes from. Is it subscription based? I think Halo-Scan might have been messed up because of the power outage in the bay... Looks like we are back on...
On a different topic there use to be a lot of talk about house sales being tallied even if the buyers did not execute the contract and buy the house. Has there been any reconciliation of these unsold houses? Does anyone know if an accurate quantity of "falsely sold" houses out there?
Busy Bears. It's all about deceleration. Can't really predict without a point of clarification on the REO issue. NAR data is a black box. Keeps the mean up as well.
"The nations multifamily vacancy rate shot up in the second quarter to an estimated 5.1%, 110 basis points higher than a year ago, according to preliminary survey results published this month by Torto Wheaton Research. The Boston-based research subsidiary of CB Richard Ellis will revise its conclusions with further data in August, but a researcher says vacancies are clearly climbing quicker than expected in many cities. "
michaelcampion, I have some great sources, and sometimes I get permission to post an excerpt. In this case the chief economist at GS gave me permission to use this excerpt.
Pardon the somewhat OT but the headline in today's fishwrap (coastal NC) is "Housing costs outpace wage growth" with the subtitle - "Essential workers in financial squeeze".
The story describes an elementary school reading teacher:
"She ran the numbers and a dream for a traditional 1,500 square-foot home has been downsized to a 1,000-square-foot modular."
My Mother was a teacher and ,without by Father's income, could never afforded a home of any kind but that was in the 30's and 40's. Perhaps that is where we are heading back to and all the rise of the middle class during 2H'20th Century was an aberation.
Amusing. Individuals scurrying out of mutual funds giving the managers heartburn.
People learn from history, and the money mangers get mad and call it ignorance:
"Fear and ignorance seem to be gripping retail investors these days," said Charles Biderman, chief executive of Santa Rosa, Calif.-based TrimTabs on Thursday, pointing to ongoing concerns about subprime lending and slumping housing markets.
"There's no credit risk; no bank is going to lose money on this subprime fear," he added. "Income-tax collections are strong, and you don't have a housing collapse when wage income and job growth are surging."
It seems they had problems with index collecting again. If you look at the transactions for a few minutes before this "event", they were just trickling and then suddenly a large group has been counted again.
Paulson says "I do believe this is a wakeup call that lenders need to be very careful with the way they price risk, structure securities,'' Paulson said.
ahhhh am I wrong but arent there no more securities to be priced, the ones that are left are sitting on a pier in a warehouse somewhere.....the rest have lost their 98% + value?????
It very well may be that the existing home sales -rate- will be near 4m by the end of the year and concievably in the depths of winter '07-'08 housing starts may be negative as previous starts are abandonded but for 2007 we've already come close to 3m transactions.
The recovery from 400+ down wasn't MADE to happen by a group with large money (not a conspiracy if they all do it independently...they just want the same goal)
Now that the lip-licking promise of an all-you-can eat buffet of endless LBO's is gone, the restaurant empties out, left-overs being tossed in the dumpster. The new ala-carte menu being offered tomorrow will prove to be less of a draw.
Dow recovers 100 point 1/2 hour before close, 4:00pm at -275, 4:15 at-310. This happened a few days before. Yesterday looked like it was manipulated too. Whats going on? Is the game gigged? who's doing the rigging? I can't play in a rigged game, and I no longer have any confidence in a fair, free stock market. I'm just no longer going to participate anymore.
watching for 1483 spus
Called_Bluff | 07.26.07 - 11:51 am | #
I don't know about you guys, but it's my personal opinion that someone has a DIAL(not unlike a volume dial) where they set the market right where they want....
Whether that be the collective hand, or one big mega hand, it's all the same....
Are Steve Liesman & Ron Insana looking to get fired by CNBC?
Cramer was hilarious too... said not to worry about financial's 'profitability'... said if losses mount they'll just fire everyone... 'just take them out and shoot them like they always do at times like this... shrugs... then let revenues recover & hire them back.' [paraphrased].
The newbies watching that on the office CCTV are probably having a nice ride home tonight. LOL.
Most amusing part of story:
Tyco Electronics began marketing its bonds yesterday, hours before Chrysler and Alliance Boots Plc called off plans to sell $20 billion of loans.
(To be fair, they had pissed off their bondholders recently because they split the company in three. This meant some bond holders were left with fewer assets backing their bonds.)
"We are not going to come up with a solution to the global imbalances or the trade imbalances we have with China unless they do some things to change the structure of their economy"
I love it ... blame China ... how 'bout we change our imbalances, like for starters, going back to reasonably sized homes, saving rather than going into debt, putting %10 down, driving cars that get more than 15 MPG ... nahh, that would be too hard.
Just blame the Chinese ... yeah that's the ticket.
Outplacement consultancy Challenger, Gray & Christmas on real-estate job cuts:
Housing-related job cuts have soared to record levels in 2007. Through the first six months of 2007, planned job cuts announced by firms in the real estate, construction and mortgage lending industries reached 37,564, 65 percent more than the 22,814 job cuts announced in all of 2006.
Housing-related job cuts account for 10 percent of the 393,499 job cuts announced so far this year. In 2006, housing cuts represented less than three percent of the year-end total.
Majority of housing job cuts came from firms in the construction industry, which announced 19,030 or 51 percent of the 37,564 housing job cuts this year. Mortgage lenders announced 16,638 job cuts in the first half of the year, more than double the 8,210 cuts announced by these firms in the first half of 2006.
Quote: The impact of the housing market slump is probably even greater than these numbers indicate. We are seeing job cuts in several other industries, including retail, consumer products manufacturing and industrial products manufacturing resulting from the slumping market. said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
The bank lent $1.6 billion to the hedge fund earlier this month after it suffered huge losses, partly from trading in the subprime mortgage market. On Thursday Bear said that $1.3 billion of the loan remained.
Bear Stearns Takes Control of Assets From Hedge Fund (Update1)
By Yalman Onaran
July 26 (Bloomberg) -- Bear Stearns Cos. said it took control of debt securities held by one of its failed hedge funds to better manage their sale and guard against further erosion in their prices.
Bear wanted to get this out of the public eye and bury it deep. I like the part about appropriate protection through hedging- yeah sure, like that is going to work now.
Oh well, enough of watching the fear part of wall street, someday it will end and we will go back to greed.
Meanwhile my progeny desires a trip to Disneyland, so I will not be blogging for an entire week. Try to have the PPT team put the plunge on hold until I return. I like seeing carnage like this live, not on a stale chart.
Last, but not least, A perfecta in ABX space- all of the issues closed on their record lows, with a number of the BBB tranches with a 30 handle.
Grim. Nice credit crisis going on here, and unabated by the fed.
I sure hope companies start buying back stock. Oh no...wait, they can't raise debt to do that and the tax code changed (IBM got in under the wire). I guess KKR and Blackstone will have to sharpen their pencils.
Any clown who pitches the "look at all of the equity being sucked out of the market" line is a donkey.
"The nation’s multifamily vacancy rate shot up in the second quarter to an estimated 5.1%"
That's because all those people who didn't disappear off the residential construction employment numbers and who quit sending remittances home are now back home themselves.
It all fits together but nobody likes to admit the size of the problem.
The market going sideways at 310ish was just weird. Looks like they have some more data management issues like when the markets went asymptotic back in Feb. Spent some time at the sheriff's sale website for Cuyahoga County (Cleveland) and it looks grim. I can't imagine Deutschebank is going to mow the lawn or prevent its new fancy property portfolio from getting looted.
One property bought for 11000 in 1990 was being foreclosed on who knows how much MEW came out of it but not being able to swing the payment on a 11k mortgage paints a pretty grim picture of what the rustbelt has only begun to suffer. The property has a minimum bid of 6k now I bet the bank will own the bombed out looted shell in no time. I would reconsider buying any munis backed by tax revenues in either MI or OH. This will wreak havoc with the already suffering locales. Not to mention the healthcare liabilities no one has paid for.
Ya lama - I was like dotcomm, thought it looked more like Peewee's Playhouse... but ya, a casino would work too. All he needs is a few bus loads of blue hairs to wander around the stage with cups full of nickels.
At the start of the year my guess was for 5.8-6.1M existing home sales. While I am frequently wrong about many things, I am very nearly never wrong because I was overly optimistic.
Sadly, for the economy and my ego, it looks like that clearly is the case. For the last six months of the year my guess is that sales will be about 2.6M, and I think I might be being optimistic here. That gives us annual sales of 5.55M, far below the middle of my previous range.
If by some miracle sales stay steady, I would be in pretty good shape w/ my original prediction, but that level of optimism borders on delusional or may even rise to the level of RE shill.
Thank you for the chance to update.
P.S. Herein I provide some unsolicited advice to Lawrence Yun and his colleagues at NAR:
As you noted the NAR's prediction at this point is waaaay beyond optimistic. While one could simply consider "the new Lereah" as hopeful, I am afraid he is falling into the same trap as David (a humble and useful servant in most matters) did. He doesn't want to be seen throwing cold water on the market, but he should take a lesson from the pros on Wall Street. When times are tough, it is important to lower expectations, therefore he needs to release guidance making people like CR look like Mr. Sunshine.
Doesn't Mr. Yun realize the devastating psychological effect of the constant downward revisions he keeps making?
By November the Realtors may lose all hope if they have to face his continuing negativism.
Rather than go low now his high call just sets up his client for a constant drip of disappointment for the rest of the year.
3.6mm is 2008
My only prediction is for severe pain.
Containment, is,,,, not,,,,,working
Predict 4.3M
Hey, I'm still waiting for the recession contest to end...
REOs will be included right? If so put me down for 5.4M...
Take a look at the Yen:
| Charts - Yahoo! Finance
Alan Abelson wrote that leverage goes slow on the way up and goes fast on the way down.
Less confident due to recent turmoil in the mortgage markets.
I love Greenspan, he has/was so wrong so many times, and yet so loved by Wall Street. He timed his exit to perfection, though.
Hmmmm, I wonder if Wells Fargo is goign to be willing to start working participation loans to move some of their commercial in the next few years.
Someday this war's gonna end...
Can anyone say what they hear about BSC or C being in a significant problem ?
I have heard elsewhere that a bank repo counts as a "sale" because it is recorded as such by the goverment after the bank wins the auction against no one. Then when sold to a human being, it is yet another "sale".
If true, maybe home "sales" won't be so bad this year!
I have heard elsewhere that a bank repo counts as a "sale" because it is recorded as such by the goverment after the bank wins the auction against no one. Then when sold to a human being, it is yet another "sale".
Well, if that's the case, put me down for 10M.
CR where do you get these quotes from. Is it subscription based? I think Halo-Scan might have been messed up because of the power outage in the bay... Looks like we are back on...
On a different topic there use to be a lot of talk about house sales being tallied even if the buyers did not execute the contract and buy the house. Has there been any reconciliation of these unsold houses? Does anyone know if an accurate quantity of "falsely sold" houses out there?
Busy Bears. It's all about deceleration. Can't really predict without a point of clarification on the REO issue. NAR data is a black box. Keeps the mean up as well.
A different look at the yen, I think this is more recent:
FXY
Huge unwinding today.
Again off topic, but interesting none the less:
Apartment Vacancy Spiking
"The nations multifamily vacancy rate shot up in the second quarter to an estimated 5.1%, 110 basis points higher than a year ago, according to preliminary survey results published this month by Torto Wheaton Research. The Boston-based research subsidiary of CB Richard Ellis will revise its conclusions with further data in August, but a researcher says vacancies are clearly climbing quicker than expected in many cities. "
Report: Apartment Vacancy Spiking
PPT action at 13420?
Looks like there's a system glitch. Volume has dropped to zero.
Remember, the Clinton's are out of the market.
I think this downturn will be worse than anyone cares to imagine.
Some concerns
1 10% of existing home sales in Orange Co. California are REO.
2 The Birth/Death Model at the BLS creates 60% of the jobs reprted each month.
3 A massive credit crunch as seen by Chrysler and others.
4 The fact that it appears we are being mislead on so many fronts with numbers we all depend.
5 The Implode O Meter stands at 102.
6 The fact that the Homebuilders are reporting losses has got to make the public a little nervous.
michaelcampion, I have some great sources, and sometimes I get permission to post an excerpt. In this case the chief economist at GS gave me permission to use this excerpt.
Best Wishes.
http://finance.yahoo.com/q/bc?s=^dji&t=1d
8.5 mil units traded at 3:10 PM??
Pardon the somewhat OT but the headline in today's fishwrap (coastal NC) is "Housing costs outpace wage growth" with the subtitle - "Essential workers in financial squeeze".
The story describes an elementary school reading teacher:
"She ran the numbers and a dream for a traditional 1,500 square-foot home has been downsized to a 1,000-square-foot modular."
My Mother was a teacher and ,without by Father's income, could never afforded a home of any kind but that was in the 30's and 40's. Perhaps that is where we are heading back to and all the rise of the middle class during 2H'20th Century was an aberation.
Hope not.
Little Johnny Market isn't allowed to play outside by himself any more today. Papa PPT is leading him by the ear back into the house.
We will only close down aroun 200 pt or so on the DOW today.
LOL
look at those eurodollar futures go!
Mortgage Woes Expected to Worsen Through 2008: Moody's - CNBC
what Moody has finally determined to be releasable to the public...
Aynon Rano
Aynon,
Paulson Says Subprime Rout Doesn't Threaten Economy (Update5) - Bloomberg.com
what Paulson has finally determined to be releasable to the public...
Expired
"HSBC braces for $9 billion in mortgage price hikes"
Amusing. Individuals scurrying out of mutual funds giving the managers heartburn.
People learn from history, and the money mangers get mad and call it ignorance:
"Fear and ignorance seem to be gripping retail investors these days," said Charles Biderman, chief executive of Santa Rosa, Calif.-based TrimTabs on Thursday, pointing to ongoing concerns about subprime lending and slumping housing markets.
"There's no credit risk; no bank is going to lose money on this subprime fear," he added. "Income-tax collections are strong, and you don't have a housing collapse when wage income and job growth are surging."
U.S. mutual-fund assets drop $5.5 billion
REBear,
It seems they had problems with index collecting again. If you look at the transactions for a few minutes before this "event", they were just trickling and then suddenly a large group has been counted again.
BTW, with regard to home sale, I've observed by doing a bit of reading in my spare time that bubbles usually end in overcorrections, not higher lows.
Without some kind of government intervention (which I think we'll see), an overcorrection would suggest home sales bottoming closer to 3 million.
Bubbles usually surprise to the upside. Busts usually surprise to the downside.
Without more information, I'll have to take the side of history.
fjr,
Subprime contained = we think we know where SP will end up this year with confidence not sure out to 2012 for 2006 4Q loans
Paulson did not addres prime impact, he is still a month behind on talking points, he must be on vacation...
badges? we don't need no stinking badges...
Aynon Rano
Paulson says "I do believe this is a wakeup call that lenders need to be very careful with the way they price risk, structure securities,'' Paulson said.
ahhhh am I wrong but arent there no more securities to be priced, the ones that are left are sitting on a pier in a warehouse somewhere.....the rest have lost their 98% + value?????
wake up Paulson!
Aynon Rano
The White House's economic Gang of Four will be on CNBC tomorrow morning to panic the markets.
White House's economic Gang of Four
"don't worry, nothing's wrong"
Gang of Four, that is great!!
what are the rules for trading curbs?
"Trading curbs, used to slow down the market in the event of a big move, were imposed by the New York Stock Exchange late this morning"
Dow plummets over 400 points - Jul. 26, 2007
It very well may be that the existing home sales -rate- will be near 4m by the end of the year and concievably in the depths of winter '07-'08 housing starts may be negative as previous starts are abandonded but for 2007 we've already come close to 3m transactions.
i miss tammie Faye already
Trading curbs. Blatant market manipulation. Yet, the PPT exists only in the minds of the tinfoil hat brigade?.
gang of 4 on tomorrow...crap Im leaving for az week at Disney...
Aynon Rano
Banker,
The recovery from 400+ down wasn't MADE to happen by a group with large money (not a conspiracy if they all do it independently...they just want the same goal)
Now that the lip-licking promise of an all-you-can eat buffet of endless LBO's is gone, the restaurant empties out, left-overs being tossed in the dumpster. The new ala-carte menu being offered tomorrow will prove to be less of a draw.
Prediction for existing home sales contest: 5.32 millio
Dow recovers 100 point 1/2 hour before close, 4:00pm at -275, 4:15 at-310. This happened a few days before. Yesterday looked like it was manipulated too. Whats going on? Is the game gigged? who's doing the rigging? I can't play in a rigged game, and I no longer have any confidence in a fair, free stock market. I'm just no longer going to participate anymore.
watching for 1483 spus
Called_Bluff | 07.26.07 - 11:51 am | #
I don't know about you guys, but it's my personal opinion that someone has a DIAL(not unlike a volume dial) where they set the market right where they want....
Whether that be the collective hand, or one big mega hand, it's all the same....
1,482.66
Are Steve Liesman & Ron Insana looking to get fired by CNBC?
The last hour on bubblevision was amazing.
Envelope please... 780K
Oh, that 780K was New Home Sales (census)
Limited completes staff cutbacks
Retailer cuts 370 in New York, elsewhere in plan to save $100 million
Limited lays off 370 workers in Ohio, New York and elsewhere - MarketWatch
So there are some people out there that probably think I'm a little bit less crazy today. I suspect some of you know the feeling...
Taking the Plunge
Public builders to public "You can't handle the truth.... see I told you so."
Are Steve Liesman & Ron Insana looking to get fired by CNBC?
Cramer was hilarious too... said not to worry about financial's 'profitability'... said if losses mount they'll just fire everyone... 'just take them out and shoot them like they always do at times like this... shrugs... then let revenues recover & hire them back.' [paraphrased].
The newbies watching that on the office CCTV are probably having a nice ride home tonight. LOL.
OT-
Max's Flippers in Trouble blog makes Forbes.
Gentlemen, The bear left the cave and took a chunk out of Goldilock's arse.
Tyco pulls $1.5bn bond issue:
Tyco Electronics Cancels $1.5 Billion Sale of Bonds (Update2) - Bloomberg.com
Most amusing part of story:
Tyco Electronics began marketing its bonds yesterday, hours before Chrysler and Alliance Boots Plc called off plans to sell $20 billion of loans.
(To be fair, they had pissed off their bondholders recently because they split the company in three. This meant some bond holders were left with fewer assets backing their bonds.)
fjr - here is the money quote from Paulsen:
"We are not going to come up with a solution to the global imbalances or the trade imbalances we have with China unless they do some things to change the structure of their economy"
I love it ... blame China ... how 'bout we change our imbalances, like for starters, going back to reasonably sized homes, saving rather than going into debt, putting %10 down, driving cars that get more than 15 MPG ... nahh, that would be too hard.
Just blame the Chinese ... yeah that's the ticket.
Gentlemen, The bear left the cave and took a chunk out of Goldilock's arse.
LOL. Where's Risk Capital? Hiking the Appalachian Trail? Man he called the 'repricing of risk' and said it is soon.
Watch Ritholz et. al. now on Larry's Circus... pretty funny. Poor Goldie, she's having a breakdown.
Containment:
Lansner on Real Estate (O.C. Register)
July 26, 2007
Housing creates 10% of U.S. layoffs
Outplacement consultancy Challenger, Gray & Christmas on real-estate job cuts:
Housing-related job cuts have soared to record levels in 2007. Through the first six months of 2007, planned job cuts announced by firms in the real estate, construction and mortgage lending industries reached 37,564, 65 percent more than the 22,814 job cuts announced in all of 2006.
Housing-related job cuts account for 10 percent of the 393,499 job cuts announced so far this year. In 2006, housing cuts represented less than three percent of the year-end total.
Majority of housing job cuts came from firms in the construction industry, which announced 19,030 or 51 percent of the 37,564 housing job cuts this year. Mortgage lenders announced 16,638 job cuts in the first half of the year, more than double the 8,210 cuts announced by these firms in the first half of 2006.
Quote: The impact of the housing market slump is probably even greater than these numbers indicate. We are seeing job cuts in several other industries, including retail, consumer products manufacturing and industrial products manufacturing resulting from the slumping market. said John A. Challenger, chief executive officer of Challenger, Gray & Christmas.
Posted by Jon Lansner at July 26, 2007 11:00 AM
Bear Stearns seizes assets from High-Grade hedge fund
Bear Stearns seizes assets from High-Grade hedge fund - MarketWatch
The bank lent $1.6 billion to the hedge fund earlier this month after it suffered huge losses, partly from trading in the subprime mortgage market. On Thursday Bear said that $1.3 billion of the loan remained.
Bear Stearns Takes Control of Assets From Hedge Fund (Update1)
By Yalman Onaran
July 26 (Bloomberg) -- Bear Stearns Cos. said it took control of debt securities held by one of its failed hedge funds to better manage their sale and guard against further erosion in their prices.
Bear wanted to get this out of the public eye and bury it deep. I like the part about appropriate protection through hedging- yeah sure, like that is going to work now.
Oh well, enough of watching the fear part of wall street, someday it will end and we will go back to greed.
Meanwhile my progeny desires a trip to Disneyland, so I will not be blogging for an entire week. Try to have the PPT team put the plunge on hold until I return. I like seeing carnage like this live, not on a stale chart.
Last, but not least, A perfecta in ABX space- all of the issues closed on their record lows, with a number of the BBB tranches with a 30 handle.
Grim. Nice credit crisis going on here, and unabated by the fed.
Someday this war's gonna end...
I sure hope companies start buying back stock. Oh no...wait, they can't raise debt to do that and the tax code changed (IBM got in under the wire). I guess KKR and Blackstone will have to sharpen their pencils.
Any clown who pitches the "look at all of the equity being sucked out of the market" line is a donkey.
"The nation’s multifamily vacancy rate shot up in the second quarter to an estimated 5.1%"
That's because all those people who didn't disappear off the residential construction employment numbers and who quit sending remittances home are now back home themselves.
It all fits together but nobody likes to admit the size of the problem.
The market going sideways at 310ish was just weird. Looks like they have some more data management issues like when the markets went asymptotic back in Feb. Spent some time at the sheriff's sale website for Cuyahoga County (Cleveland) and it looks grim. I can't imagine Deutschebank is going to mow the lawn or prevent its new fancy property portfolio from getting looted.
One property bought for 11000 in 1990 was being foreclosed on who knows how much MEW came out of it but not being able to swing the payment on a 11k mortgage paints a pretty grim picture of what the rustbelt has only begun to suffer. The property has a minimum bid of 6k now I bet the bank will own the bombed out looted shell in no time. I would reconsider buying any munis backed by tax revenues in either MI or OH. This will wreak havoc with the already suffering locales. Not to mention the healthcare liabilities no one has paid for.
Dry,
Cramer; I've said it before, but:
Ever notice that the set of his show looks like a casino?
lama, your Cramer Casino is a great insight.
I first thought it was like a kid's show, but I guess they're eerily similar.
Ya lama - I was like dotcomm, thought it looked more like Peewee's Playhouse... but ya, a casino would work too. All he needs is a few bus loads of blue hairs to wander around the stage with cups full of nickels.
At the start of the year my guess was for 5.8-6.1M existing home sales. While I am frequently wrong about many things, I am very nearly never wrong because I was overly optimistic.
Sadly, for the economy and my ego, it looks like that clearly is the case. For the last six months of the year my guess is that sales will be about 2.6M, and I think I might be being optimistic here. That gives us annual sales of 5.55M, far below the middle of my previous range.
If by some miracle sales stay steady, I would be in pretty good shape w/ my original prediction, but that level of optimism borders on delusional or may even rise to the level of RE shill.
Thank you for the chance to update.
P.S. Herein I provide some unsolicited advice to Lawrence Yun and his colleagues at NAR:
As you noted the NAR's prediction at this point is waaaay beyond optimistic. While one could simply consider "the new Lereah" as hopeful, I am afraid he is falling into the same trap as David (a humble and useful servant in most matters) did. He doesn't want to be seen throwing cold water on the market, but he should take a lesson from the pros on Wall Street. When times are tough, it is important to lower expectations, therefore he needs to release guidance making people like CR look like Mr. Sunshine.
Doesn't Mr. Yun realize the devastating psychological effect of the constant downward revisions he keeps making?
By November the Realtors may lose all hope if they have to face his continuing negativism.
Rather than go low now his high call just sets up his client for a constant drip of disappointment for the rest of the year.
Is CR going to chart the guesses?