Key Components of Non-Residential Investment, Nominal Dollars
Submitted by
CalculatedRisk on Mon, 05/05/2008 - 4:49pm (14 comments)
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urgent message from Ben
BB quote-- "Therefore, doing what we can to avoid preventable foreclosures is not just in the interest of lenders and borrowers. It's in everybody's interest,"
He's giving advance notice that the Fed will socialize more corporate losses.
In the Spirit of sharing the pain and responsibility I do hereby volunteer my my mortgage for a balance write down. I can show through zillow tracking that I have lost more than $400,000 since the peak.
I think they should of had James Howard Kunstler give the dinner speech to the Columbia Business School. A little more entertaining.
http://www.biiwii.com/guest4/kunstler/36.htm
More butter please......
"He's giving advance notice that the Fed will socialize more corporate losses."
He saying that the Fed is about to lose the battle and he's calling in for reinforcements. He is giving notice that he's about to implement Plan B. This would constitute an S&L type of mop up.
Thanks Ben, glad you know what's in my best interests... you're an idiot and it's already too late, but I suppose that won't stop you from trying.
"A widespread decline in home prices, by contrast, is a relatively novel phenomenon, and lenders and servicers will have to develop new and flexible strategies to deal with this issue," Bernanke said.
Switch out "decline" and "rise"... and you'll see what side of the coin I'm on. Please tell me how asset deflation is a "novel" phenomenon? Considering the fact that the widespread rise in home prices is a relatively novel phenomenon, do you think we aren't familiar with history? All I need to do is look at historical median-price to median-income to see that it's a bubble and you are full of manure because you showed no concern when the home prices was a novel phenomenon what the heck did you think was going to happen you book-loving genius!?!
So when do they force those of us without mortgages to buy homes? After all keeping the housing prices inflated is the patriotic thing to do apparently.
The Fed hopes that its powerful series of rate cuts its most aggressive in decades along with the government's $168 billion stimulus package including tax rebates that started flowing to bank accounts last week will be sufficient to lift the country out of its slump in the second half of this year.
This will do nothing to help with the issues of MEW, HELOC's and using the house as a credit card that has been covered by this very blog!
How about this Ben.. "the prices will decline until those on the sidelines decide they are getting a good value..." except that America is over-built anyway... and most new buyers have already bought in...
Sigh Yes, I know I'm just pissing in the wind, but man... the adults in charge are really stupid.
Sorry, I meant to write you showed no concern when the home price rise was a 'novel' phenomenon.
Rob Dawg, you're the guy whose neighbor is taking a 600k haircut (according to Redfin), right? Well if I'm subsidizing your mortgage my family is going to move in with you. I hope you don't mind Barney, Curious George, Muppets and Seasame Street... and other 2 year old fare... but don't worry since my wife is an excellent cook...
YSLP,
""A widespread decline in home prices, by contrast, is a relatively novel phenomenon, and lenders and servicers will have to develop new and flexible strategies to deal with this issue," Bernanke said."
Bankruptcy? Seriously the man is nuts.
"The Fed hopes that its powerful series of rate cuts its most aggressive in decades"
Well then why is SHITI paying like 8% to get cash?
"along with the government's $168 billion stimulus package"
The only entity getting those uber low rates is the gov't. What astounds me is that most people who get them don't understand that they have to repay this at some point. But I don't want to piss myself off about this "stimulous" absurdity.
"will be sufficient to lift the country out of its slump in the second half of this year."
They might as well have spent the money sending shrooms to the receivers (I did not get one, as I am a rich person who doesn't deserve a break...according to the gov't) along with DVD's of get rich quick in RE. They could have included an instruction manual that said:
Oh well, I have ammo and food now. However, the way the Super Colander Tin Foil Hat is behaving lately, I'm gonna need to stock up on tin foil as well.
Cheers,
CRE decline...
...the second wave arrives.
As I recall, Lodging got hammered last time.
Like Wow man, bieeeeeg waves.
This next one is a doozy.
I can hardly wait for Kudlow to call yet another bottom. And another...
But hey, Big Ben seems to think that it is contained- LOL
Like this?
"First, we have employed economic research and analysis, a particular strength of the Federal Reserve, to increase the sum of knowledge about mortgage and housing issues."
Like you guys did squat for the tech bubble?He has got to be kidding here.
"Second, we are collaborating with interested parties across the country, taking advantage of our national presence and our existing relationships with local lenders, community groups, government officials, and other stakeholders, to take practical steps to address the causes and consequences of foreclosures."
So we talk to all of these folks while the foreclosures go on and on... talk is cheap.
"Third, we are engaged with mortgage servicers to understand impediments they may face when modifying loans or offering other alternatives to foreclosure. Servicers still report difficulty connecting with troubled borrowers, and we have supported efforts to encourage borrowers to contact their lenders or housing counselors."
Um, see the last month of Tanta post. No need to rehash her excellent criticism.
In short, nada for quite a while folks. Twilight for the American Dream.
Geez, I can't believe anybody expected more from the Fed.
Someday this war's gonna end...
CR,
I'm not sure why you brought out this new graph. Your private construction spending graph says it all. 1993 is a safe comparison and that is over $200B down.
So the head Fed thinks it's in everyone's best interest to have housing be unaffordable, relative to incomes?
I don't think "everyone" means what he thinks it means.
Or was he planning on doing montly direct deposits to supplement net income, in conjunction with write downs, to help everyone? Will the prudent folks be getting checks too, or we we be means testing the unpatriotic bastards?
"Freddie Mac posts 2.19 billion loss, plans to raise $6 billion."
Where do I sign up. This should be awesome for stocks, particularly FRE.
Sorry that loss and capital raise is for Fannie Mae. Makes no difference though as its awesome for all stocks!