On a side note and off topic, I think Goldman is having quite a bit of fun with the current enviroment. Lets just hope all those commerical loans perform or they will look like jokers in a year or two....
NEW YORK -(Dow Jones)- The business models of U.S. brokerages and international banks continue to deteriorate and their recovery will take longer than anticipated, Goldman Sachs (GS) told clients Thursday.
The firm cut its recommendation of the sector to neutral from attractive and strongly recommended that investors sell shares of Citigroup Inc. (C), saying it faced multiple problems, including more asset write-downs, higher loss provisions for consumer credit and the potential for more capital raises, dividend cuts or asset sales. CNNMoney.com: 404 Page Not Found
Business Week
Small Banks: How Fragile Are They?
Credit troubles at many smaller institutions are mountingand plunging shares make it harder to raise capital to cover losses (identifies several weak banks) Small Banks: How Fragile Are They?
"And oil has a stranglehold on the economy/stocks, etc."
I think the oil issues haven't yet hit the price of goods or the consumers wallet. Give it 3 more months of $5.00/Gallon and then we'll see suffering...
CR Note: just to be clear, my forecast isn't for a housing rebound.
CR,
How do you see housing rebounding if we get a recession that goes thru December. Does that push your forecast for a rebound out or do you think they are somewhat independent of each other...
Hmm, I think I consider the previous month's revised figures to be more relevant. Current month's unrevised figures are interesting, but in the past there have been major revisions that render the unrevised figures less than reliable.
ades, who ever said anything about housing rebounding any time soon? Not me. I think existing home sales will fall much further - and are currently being held up by REO sales.
Albert Edwards of SocGen says, "A deep recession will result in a profits slump. Coupled with an Ice Age P/E contraction, we see global equity markets falling some 70% from their Oct 07 peak. I expect the S&P to bottom around 500 (verses the 1,575 peak) and FTSE around 3,000..."-
I was in probate court yesterday and saw the judge approve the sale of a fixer-upper in Phoenix for $80,000. Appraised not long ago at $140,000.
The broker explained that the only thing moving in the market now is foreclosures. If you need to sell, you have to price it to compete with the banks.
The Supreme Court ruled on Thursday, for the first time in U.S. history, that individual Americans have the right to own guns for personal use, and struck down a strict gun control law in the nation's capital.
*Sorry for thread high-jacking but I thought this might be a pier loan gone bad...
Sam Zell, the real estate magnate who took the Tribune Company private last year in a $8.2 billion deal, may be returning to his roots.
In effort to pay off Tribunes mounting debt, which The Chicago Tribune reports now stands at roughly $13 billion, Mr. Zell is exploring the possible sale of the media companys headquarters on the Magnificent Mile in Chicago and buildings in Los Angeles.
Lennar Corp. reported Thursday a second-quarter loss that wasn't as deep as the year-ago period, but the home builder expects conditions in the housing market to worsen as the year wears on.
"Loss severity the average amount lost relative to unpaid principal balance reached 41.4 percent for all Alt-A first liens in REO during the most recent rolling six month period through May, Clayton said; that was up from a 37.6 percent rolling average one month earlier, and compares to a similar 49 percent loss severity average for subprime first liens liquidated in REO through May."
"The problem isnt rate resets of adjustable-rate mortgages, either, a point weve been hammering for some time. Rather, rapidly falling home prices and a weakening economy are the chief culprits here."
Amid all the attention being paid to rate adjustments, however, its important to note that out of all the active delinquent ARM loans in Claytons portfolio, approximately 70 percent were already delinquent prior to the first rate change date, analysts at the firm noted in their report.
I just saw some snarky reporter on Fox ask Wayne LaPierre if he could buy a gun on his lunch hour, and take it home for dinner. Oh the indignance of the unwashed being able to afford protection. I assume the reporter lived in a hight rise with a doorman, or a gated community, and doesn't need protection. However a single mother forced to put her kids into a failing shcool in the hood because Obama is against charter schools can't have her protection. Screw these guys.
Not all foreclosures go through the MLS; those that don't are not measured in the NAR's existing home sales series. Foreclosures may be sold through different channels: auctions, bank sales, and brokers. The first two would not be picked up by MLSs; brokers might be. The NAR is not sure what percentage of foreclosure sales they miss. To the extent that they are missing foreclosure sales, the NAR's average price of existing homes, would be biased upward and unit sales volume biased down. Of course, some foreclosed properties are bought at auction (for example), refurbished, and then sold, perhaps through the MLS; in this example, the second sale would be picked up.
VRSN has volume at the high and three signs of strength in May; it's not a short by any risk/reward measure I look at. CRM looks similar - but without the high volume high; it's pulling back into its sign of strength day 5/04 w/ light volume - no short.
Family member of mine finally sold a home that they purchased for renovation (against my advice in early '07) they are taking a loss on the sale and it is a VA loan (seller covers some closing) but the offer was enough to consider once the current environment of increasing inventory is factored in. Location was in Vancouver Wa.
Props. are selling ......IF (a big if) they are priced closer to reality.
Sales will pick up... when prices COME DOWN! This is already happening in some places, though not in others (Maryland, DC, NoVa, for example.)
Still, in plenty of places with price declines, the houses are still grossly overpriced. I assume we'll see many knife-catchers and multiple foreclosures on the same houses in the coming years.
My wife is a realtor. You probably won't be surprised that it is very easy to excel as a realtor because 99% of them are losers.
That said, it is fascinating to get a daily accounting of how buyers and sellers think in this market.
Sellers (in upstate NY) are still very stuck on their ideal price (i believe this is known as homaluccination). Buyers are all getting really cocky. I believe we can retire the phrase "bidding war".
All in all, most people are exceptionally stubborn when making real estate deals and very poor a making smart financial decisions. I'm reminded of Tanta's post from last August.
People tend to hold overly favorable views of their abilities in many social and intellectual domains. The authors suggest that this overestimation occurs, in part, because people who are unskilled in these domains suffer a dual burden: Not only do these people reach erroneous conclusions and make unfortunate choices, but their incompetence robs them of the metacognitive ability to realize it. Across 4 studies, the authors found that participants scoring in the bottom quartile on tests of humor, grammar, and logic grossly overestimated their test performance and ability. Although their test scores put them in the 12th percentile, they estimated themselves to be in the 62nd. Several analyses linked this miscalibration to deficits in metacognitive skill, or the capacity to distinguish accuracy from error. Paradoxically, improving the skills of participants, and thus increasing their metacognitive competence, helped them recognize the limitations of their abilities.
Small time builder friends of mine are indicating that the market in exurban and farther suburban areas has really slowed down for new home sales.
(Montreal, Qc, Canada)
On the island things are still moving briskly and prices are are their top range.
Of course, prices here are much lower than other canadian or US large cities.. Still, a house going for 200K 5 years ago now goes for 300K. 10 years ago, this house was worth 150K.
Nothing like the pain US is experiencing with high drops from unsustainable levels and inflation coming on strong in all aspects of life.
It is the young and the (now) housepoor savingsless retirees that will suffer in the coming crunch/stagflatulence.
...as a mover, the business in the voluntary move market remains exceptionally slow....
I see no signs that family owned home sales will increase in the remainder of '08.......
and, if they don't try to sell by October 15th, then the psychology of sellers will be to wait until after the Holidays to list their homes.....
my guess is that many retirees, who make up about 35% of the out of state move market, will look at the selling price of their home in March of '09 and decide to stay in California.........
12th Percentile writes:
"My wife is a realtor. You probably won't be surprised that it is very easy to excel as a realtor because 99% of them are losers."
Friends wife has been at it for 30+ years. She is about ready to retire. Her broker begged her to stay on for a while longer. Why? She was practically the only aget to sell anyhting last year...
BTW,she told all (10+) of her condo customers from up north to wait at least a year to get serious. They all waited.
Hi I'm looking to build up my incoming links for my blog.
Would you like to exchange blogroll links with me?
If yes, please visit: Blogger: Blog not found
and leave your URL for your blog there. I'll link to you within
My wife is successful because she tells the truth. Short term that isn't good for business (Exhibit A: NAR's constant lying). Long term it is a real winner. We also live in the neighborhood where she does business. It would be unpleasant to have to see all your neighbors who you told "home prices only go up" when they were 30% underwater.
If you like people and real estate I actually think being an agent is a good career move. I don't like people so its not an option for me.
If gold goes much higher, the Gov't may be tempted to crack open fort knox and sell off whatever's inside. Of course, that's probably just some copies of Penthouse from the 70's, but whatever.
Re: Prices
You can always sell if you cut your price enough. The goal of public policy during a bubble should be to bring prices down to the market clearing level as fast as possible so the market can start functioning and a recovery can begin. Instead we get boneheads trying to prop prices up with cheap money and reduced requirements on federal guarantees.
While on the one hand it is pretty silly that Fannie and Freddie have statutory dollar limitations on guarantees (rather than a more flexible system that would permit them to cover loans consistent with long-run value), it is not silly at all that they should refuse to cover loans they don't think make sense.
"However a single mother forced to put her kids into a failing shcool in the hood because Obama is against charter schools can't have her protection."
Lefty, if you're opposed to Obama that's your business. However, don't make shit up. Obama specifically supports charter schools. From the website Politico.com from Feb. 12 this year:
"Taking a position that could help him win a general election, Sen. Barack Obama (D-Ill.) said in an interview that the federal government should experiment with charter schools even if some Democrats oppose the idea.
In a joint interview with Politico WJLA/ABC 7, Obama was asked about issues on which he might oppose the mainstream of his party.
Ive consistently said I think we need to support charter schools, Obama said. I think its important for us to experiment in terms of how teachers are compensated working with teachers but looking at how we can reward excellence in classrooms.
Asked about the reaction of teachers unions, Obama acknowledged that they havent been thrilled with me talking about this.
My sisters a teacher, so I am a strong supporter of teachers, he said. But Im not going to be bound by just a certain way of talking about things in order for us to move forward on behalf of our kids. And I think a lot of teachers want to talk about how we can continue improving performance measures. Weve got to get beyond a lot of the traditional categories.
jeff: as has been repeatedly mention, sales back to the bank are not forclosure sales.
Something I don't remember if it was mentioned, and might be the 30% shadow inventory others have mentioned this thread; do the inventory numbers include "For Sale By Owner?" and similarly, do the sales numbers include "Sold by Owner?"
Here in Ontario, Houses are still moving for those who aren't trying 10%+ above last year's price (backyard neighbor is going this route). However, about 5-10% by eyeball seem to be for sale by owner. Some are even selling.
Of course OPEC wants to pop the oil bubble. Super high prices for too long will lead to substitute sources of oil, energy or alteration of living patterns to reduce long term demand.
The oil embargo blew up in OPEC's face and led to very cheap oil for many years. The Saudis, who essentially are OPEC (all other OPEC members chisel and produce close to their max), want relatively high, stable prices.
The price of oil, if it doesn't go down, is going to lead to more mass transit, more people moving into cities, and more people buying hybrids and other high mileage cars. It will also lead to more non-OPEC oil. In the long run, that is a disaster for single-commodity export nations in OPEC.
The existing home sales data include for-sale-by-owner (FSBO) sales only indirectly. In short, existing home sales is benchmarked currently to the 2000 Census. Blow-up factors calculated from the Census, which map from the MLS sample to the universe, include FSBOs. the blow-up factors are based on data from the Census year. As a result, the NAR assumes they are essentially a constant share of total sales. By the way, the same is true for any other types of existing homes sold that do not go through the MLS, including foreclosures.
jg- please try to refrain from poking the Obama supporters, I don't mind the jabs myself (although I'm probably gonna vote that way) I just hate the responses degenerating into the same name calling. I'm asking you because I think there's a chance you'll respect the blog's focus while the true believers are ideologically bound to respond. I mean, it's like shooting fish in a barrel, no?
Would someone be kind enough to educate an ignorant wench?
What exactly is/comprises "shadow inventory"? And how/why is it estimated at 30%?
From Charlie Poole's comment,am gleaning that as NAR figures are taken from the MLS, sales occurring "outside" the MLS should be kept in mind.
OK-- might that explain a wierd sale that happened in my hood recently? A widow lady had a big ole house in semi-decent condition (livable, but her not-so-handyman husband had done all the work on it for years-- badly...)) up for sale for well over a year with a realtor, & had reduced her price again this spring down to 270K but still no sale. (Similar size homes here, but in good condition, were selling here for around $330K-- well, they were selling-- nothing's sold here now since Christmas.)
Anyway, I learned from a pal who knows the lady that, desperate for the money, she told her realtor to just sell the damn home for what she could get.
So one day about 3 weeks ago, suddenly the street was filled with cars & people going into the house for some kind of "auction"-- put on by the realtor. The winning bidder came out crowing that she'd won it for 197K.
Can realtors hold "auctions" of their own dog listings?
& if so, does that mean the sale price won't be reported on the MLS, so it won't then bust the comps for all the other listings they're trying to sell?
(Sorry to ask such basic q's but as per Tanta's old post cited above am trying to move up from the like 5th percentile.)
(12thPercentile: 'I don't like people so (*being a realtor)'s not an option for me.' LOL'ing-- (& yet with such astute self-knowledge you still picked 12thPercentile as your username?? )
Might there be some double counting on the existing home sales? Is a Trustee Sale counted as a sale? And of course, when that REO does indeed sell, it is counted. Seems to me trustee sales should not count as legitimate sales. Any know for sure?
Thanks
Nice charts!
Yikes!
And oil has a stranglehold on the economy/stocks, etc.
CR as always good work.
On a side note and off topic, I think Goldman is having quite a bit of fun with the current enviroment. Lets just hope all those commerical loans perform or they will look like jokers in a year or two....
NEW YORK -(Dow Jones)- The business models of U.S. brokerages and international banks continue to deteriorate and their recovery will take longer than anticipated, Goldman Sachs (GS) told clients Thursday.
The firm cut its recommendation of the sector to neutral from attractive and strongly recommended that investors sell shares of Citigroup Inc. (C), saying it faced multiple problems, including more asset write-downs, higher loss provisions for consumer credit and the potential for more capital raises, dividend cuts or asset sales. CNNMoney.com: 404 Page Not Found
"And oil has a stranglehold on the economy/stocks, etc."
No 536 boneheads in DC and a central bank do.
Business Week
Small Banks: How Fragile Are They?
Credit troubles at many smaller institutions are mountingand plunging shares make it harder to raise capital to cover losses (identifies several weak banks)
Small Banks: How Fragile Are They?
"And oil has a stranglehold on the economy/stocks, etc."
I think the oil issues haven't yet hit the price of goods or the consumers wallet. Give it 3 more months of $5.00/Gallon and then we'll see suffering...
CR Note: just to be clear, my forecast isn't for a housing rebound.
CR,
How do you see housing rebounding if we get a recession that goes thru December. Does that push your forecast for a rebound out or do you think they are somewhat independent of each other...
Thanks CR, great charts. If I am reading them right, then in about 60 months the supply of homes will be about normal.
Hmm, I think I consider the previous month's revised figures to be more relevant. Current month's unrevised figures are interesting, but in the past there have been major revisions that render the unrevised figures less than reliable.
ades, who ever said anything about housing rebounding any time soon? Not me. I think existing home sales will fall much further - and are currently being held up by REO sales.
Best Wishes.
The oil-- oops. Then maybe more?
Why does anyone consider MoM changes relevant?
If anyone ever referred to MoM changes in my own industry, which is also seasonal, they would be laughed out of the room.
CR: Deleted. User banned.
Edited By Siteowner
Looks like somebody agrees with CR, the dow just took out 11,640
Albert Edwards of SocGen says, "A deep recession will result in a profits slump. Coupled with an Ice Age P/E contraction, we see global equity markets falling some 70% from their Oct 07 peak. I expect the S&P to bottom around 500 (verses the 1,575 peak) and FTSE around 3,000..."-
FT Alphaville » Blog Archive » Edwards: “We see a y-shaped global recession. We are going down before looping backwards”
CR good point! Didnt mean to miss-quote you... Thanks....
I was in probate court yesterday and saw the judge approve the sale of a fixer-upper in Phoenix for $80,000. Appraised not long ago at $140,000.
The broker explained that the only thing moving in the market now is foreclosures. If you need to sell, you have to price it to compete with the banks.
The Supreme Court ruled on Thursday, for the first time in U.S. history, that individual Americans have the right to own guns for personal use, and struck down a strict gun control law in the nation's capital.
Business & Financial News, Breaking US & International News | Reuters.com
Maybe there is hope for this country after all.
the date gets more Raw than that...yikes
With mortgage rates rising, and much higher than they were in the last 6 months, sales will have to fall...
I think inventory hasn't even come close to topping... unless we use NAR numbers of course
CR
*Sorry for thread high-jacking but I thought this might be a pier loan gone bad...
Sam Zell, the real estate magnate who took the Tribune Company private last year in a $8.2 billion deal, may be returning to his roots.
In effort to pay off Tribunes mounting debt, which The Chicago Tribune reports now stands at roughly $13 billion, Mr. Zell is exploring the possible sale of the media companys headquarters on the Magnificent Mile in Chicago and buildings in Los Angeles.
Zell Mulls Sale of Tribune Tower - DealBook Blog - NYTimes.com
One can only grave dance so often...
.........
Shadow inventory is still not online yet. 6-12 months and we will see inventory explode...
Oh no - Jesus was banned from haloscan.
Jesus got banned for touting a new mark-to-model fantasy. Beware of false profits.
tranches of like writes:
Jesus got banned for touting a new mark-to-model fantasy. Beware of false profits.
Noice.
Looks like Lennar is coming around too:
Lennar Corp. reported Thursday a second-quarter loss that wasn't as deep as the year-ago period, but the home builder expects conditions in the housing market to worsen as the year wears on.
Perhaps it should have said "years!"
Home Resales in U.S. Rose to 4.99 Million Rate in May.
- Bloomberg.com
More words on the subject.
Just saw this over at HousingWire that Alt-A Performance Gets Much Worse in May. Alt-A Performance Gets Much Worse in May : HousingWire || financial news for the mortgage market
"Loss severity the average amount lost relative to unpaid principal balance reached 41.4 percent for all Alt-A first liens in REO during the most recent rolling six month period through May, Clayton said; that was up from a 37.6 percent rolling average one month earlier, and compares to a similar 49 percent loss severity average for subprime first liens liquidated in REO through May."
"The problem isnt rate resets of adjustable-rate mortgages, either, a point weve been hammering for some time. Rather, rapidly falling home prices and a weakening economy are the chief culprits here."
Amid all the attention being paid to rate adjustments, however, its important to note that out of all the active delinquent ARM loans in Claytons portfolio, approximately 70 percent were already delinquent prior to the first rate change date, analysts at the firm noted in their report.
We're all subprime now.
CR: Deleted. User banned.
Edited By Siteowner
Jesus | 06.26.08 - 11:25 am |
For all interested, the comment used the dreaded "J" word - the only word not mentionable on this blog.
And it's not Jas or Jain. It rhymes with MEW.
I found a couple of good short-sell candidates: CRM & VRSN.
I just saw some snarky reporter on Fox ask Wayne LaPierre if he could buy a gun on his lunch hour, and take it home for dinner. Oh the indignance of the unwashed being able to afford protection. I assume the reporter lived in a hight rise with a doorman, or a gated community, and doesn't need protection. However a single mother forced to put her kids into a failing shcool in the hood because Obama is against charter schools can't have her protection. Screw these guys.
CR
Not all foreclosures go through the MLS; those that don't are not measured in the NAR's existing home sales series. Foreclosures may be sold through different channels: auctions, bank sales, and brokers. The first two would not be picked up by MLSs; brokers might be. The NAR is not sure what percentage of foreclosure sales they miss. To the extent that they are missing foreclosure sales, the NAR's average price of existing homes, would be biased upward and unit sales volume biased down. Of course, some foreclosed properties are bought at auction (for example), refurbished, and then sold, perhaps through the MLS; in this example, the second sale would be picked up.
OT, wawawa,
VRSN has volume at the high and three signs of strength in May; it's not a short by any risk/reward measure I look at. CRM looks similar - but without the high volume high; it's pulling back into its sign of strength day 5/04 w/ light volume - no short.
wawawa - CRM is screaming tech bubble.
anecdotal information:
Family member of mine finally sold a home that they purchased for renovation (against my advice in early '07) they are taking a loss on the sale and it is a VA loan (seller covers some closing) but the offer was enough to consider once the current environment of increasing inventory is factored in. Location was in Vancouver Wa.
Props. are selling ......IF (a big if) they are priced closer to reality.
Ciao
MS
what about the 30% shadow inventory ?
Note: for the 2nd month in a row, the NAR didn't release the Existing Home sales data online in a timely manner.
Well at least they didn't get the press to report how much sales increased and forget about that whole seasonality thing...
CRM is an ATM for Benioff.....have not looked in a while but he was dropping over $1m in options on it almost every other day.
It screamed short when it was in the mid twenties because of that alone....funny how it didn't work out that way.....
MB is one of the larger douches in tech. and that is saying something.....look who he learned from.
Ciao
MS
Sales will pick up... when prices COME DOWN! This is already happening in some places, though not in others (Maryland, DC, NoVa, for example.)
Still, in plenty of places with price declines, the houses are still grossly overpriced. I assume we'll see many knife-catchers and multiple foreclosures on the same houses in the coming years.
My wife is a realtor. You probably won't be surprised that it is very easy to excel as a realtor because 99% of them are losers.
That said, it is fascinating to get a daily accounting of how buyers and sellers think in this market.
Sellers (in upstate NY) are still very stuck on their ideal price (i believe this is known as homaluccination). Buyers are all getting really cocky. I believe we can retire the phrase "bidding war".
All in all, most people are exceptionally stubborn when making real estate deals and very poor a making smart financial decisions. I'm reminded of Tanta's post from last August.
MS agree with you entirely. I was wondering how long it would take for people to wake up on this one.
"Sellers (in upstate NY) are still very stuck on their ideal price ."
I did this once in a slow market. Never again. Pain is the great teacher. It'll teach these sellers, as well.
As for the buyers, getting too cocky is a great way to get taken.
Small time builder friends of mine are indicating that the market in exurban and farther suburban areas has really slowed down for new home sales.
(Montreal, Qc, Canada)
On the island things are still moving briskly and prices are are their top range.
Of course, prices here are much lower than other canadian or US large cities.. Still, a house going for 200K 5 years ago now goes for 300K. 10 years ago, this house was worth 150K.
Nothing like the pain US is experiencing with high drops from unsustainable levels and inflation coming on strong in all aspects of life.
It is the young and the (now) housepoor savingsless retirees that will suffer in the coming crunch/stagflatulence.
Cheers
As for the buyers, getting too cocky is a great way to get taken.
Everyone wants to be the first, Gloating saying how smart they were and picked the bottom
Banks Balance Sheet Destruction and Repair! -Crack Up Boom Part III
Banks Balance Sheet Destruction and Repair! -Crack Up Boom Part III :: The Market Oracle :: Financial Markets Analysis & Forecasting Free Website
An extremely good succinct article, especially like the graphs, check out the one on mortgages.
...as a mover, the business in the voluntary move market remains exceptionally slow....
I see no signs that family owned home sales will increase in the remainder of '08.......
and, if they don't try to sell by October 15th, then the psychology of sellers will be to wait until after the Holidays to list their homes.....
my guess is that many retirees, who make up about 35% of the out of state move market, will look at the selling price of their home in March of '09 and decide to stay in California.........
I mean that buyers are getting cocky and lowballing and walking away. We haven't experienced any real price drop here....yet.
12th Percentile writes:
"My wife is a realtor. You probably won't be surprised that it is very easy to excel as a realtor because 99% of them are losers."
Friends wife has been at it for 30+ years. She is about ready to retire. Her broker begged her to stay on for a while longer. Why? She was practically the only aget to sell anyhting last year...
BTW,she told all (10+) of her condo customers from up north to wait at least a year to get serious. They all waited.
Chris
Hi I'm looking to build up my incoming links for my blog.
Would you like to exchange blogroll links with me?
If yes, please visit: Blogger: Blog not found
and leave your URL for your blog there. I'll link to you within
hours. Thanks.
Come on already, will somebody please badmouth gold. When it's going up all bugs squawk but where are they when it's going down.
My wife is successful because she tells the truth. Short term that isn't good for business (Exhibit A: NAR's constant lying). Long term it is a real winner. We also live in the neighborhood where she does business. It would be unpleasant to have to see all your neighbors who you told "home prices only go up" when they were 30% underwater.
If you like people and real estate I actually think being an agent is a good career move. I don't like people so its not an option for me.
uuu writes:
Come on already, will somebody please badmouth gold. When it's going up all bugs squawk but where are they when it's going down.
Gold is slow moving, should be up higher already.
How's that?
Anyone else find it funny that OPEC is trying like hell to pop the oil bubble?
Is the oil and commodity crash over now?
Looks like the strong dollar policy is working really well.
BB - Gold should be $2K by years end. Good enough ?
link to story on OPEC
Looks like the schmucks were trying to pull the market back up via futures purchases, but are now just flowing with the crowd.
Do "foreclosure sales" include one bid "sales" to the bank for the amount of the loan? If so, they are overstated.
If gold goes much higher, the Gov't may be tempted to crack open fort knox and sell off whatever's inside. Of course, that's probably just some copies of Penthouse from the 70's, but whatever.
Re: Prices
You can always sell if you cut your price enough. The goal of public policy during a bubble should be to bring prices down to the market clearing level as fast as possible so the market can start functioning and a recovery can begin. Instead we get boneheads trying to prop prices up with cheap money and reduced requirements on federal guarantees.
While on the one hand it is pretty silly that Fannie and Freddie have statutory dollar limitations on guarantees (rather than a more flexible system that would permit them to cover loans consistent with long-run value), it is not silly at all that they should refuse to cover loans they don't think make sense.
"However a single mother forced to put her kids into a failing shcool in the hood because Obama is against charter schools can't have her protection."
Lefty, if you're opposed to Obama that's your business. However, don't make shit up. Obama specifically supports charter schools. From the website Politico.com from Feb. 12 this year:
"Taking a position that could help him win a general election, Sen. Barack Obama (D-Ill.) said in an interview that the federal government should experiment with charter schools even if some Democrats oppose the idea.
In a joint interview with Politico WJLA/ABC 7, Obama was asked about issues on which he might oppose the mainstream of his party.
Ive consistently said I think we need to support charter schools, Obama said. I think its important for us to experiment in terms of how teachers are compensated working with teachers but looking at how we can reward excellence in classrooms.
Asked about the reaction of teachers unions, Obama acknowledged that they havent been thrilled with me talking about this.
My sisters a teacher, so I am a strong supporter of teachers, he said. But Im not going to be bound by just a certain way of talking about things in order for us to move forward on behalf of our kids. And I think a lot of teachers want to talk about how we can continue improving performance measures. Weve got to get beyond a lot of the traditional categories.
Interesting Times writes:
BB - Gold should be $2K by years end. Good enough ?
If someone would just take out 930 today, would be more than satisfying.
jeff: as has been repeatedly mention, sales back to the bank are not forclosure sales.
Something I don't remember if it was mentioned, and might be the 30% shadow inventory others have mentioned this thread; do the inventory numbers include "For Sale By Owner?" and similarly, do the sales numbers include "Sold by Owner?"
Here in Ontario, Houses are still moving for those who aren't trying 10%+ above last year's price (backyard neighbor is going this route). However, about 5-10% by eyeball seem to be for sale by owner. Some are even selling.
@614
Of course OPEC wants to pop the oil bubble. Super high prices for too long will lead to substitute sources of oil, energy or alteration of living patterns to reduce long term demand.
The oil embargo blew up in OPEC's face and led to very cheap oil for many years. The Saudis, who essentially are OPEC (all other OPEC members chisel and produce close to their max), want relatively high, stable prices.
The price of oil, if it doesn't go down, is going to lead to more mass transit, more people moving into cities, and more people buying hybrids and other high mileage cars. It will also lead to more non-OPEC oil. In the long run, that is a disaster for single-commodity export nations in OPEC.
b-s-d-, glad to hear that O- supports charter schools.
I understand that he has his kids in private schools? As do 50%+ of Chicago public school teachers?
anyone who believes the price of oil is where it is strictly from the argument of supply and demand should look at the solar stocks......
Remember when they moved inversely of oil?? They don't any longer.....
FSLR and ESLR are but two examples both down 6% and 7.50% respectively.
It is a sham...no other way to describe it.
Ciao
MS
The existing home sales data include for-sale-by-owner (FSBO) sales only indirectly. In short, existing home sales is benchmarked currently to the 2000 Census. Blow-up factors calculated from the Census, which map from the MLS sample to the universe, include FSBOs. the blow-up factors are based on data from the Census year. As a result, the NAR assumes they are essentially a constant share of total sales. By the way, the same is true for any other types of existing homes sold that do not go through the MLS, including foreclosures.
jg- please try to refrain from poking the Obama supporters, I don't mind the jabs myself (although I'm probably gonna vote that way) I just hate the responses degenerating into the same name calling. I'm asking you because I think there's a chance you'll respect the blog's focus while the true believers are ideologically bound to respond. I mean, it's like shooting fish in a barrel, no?
how many of the houses sold were sold to the bankers at the court house foreclosing sales
Would someone be kind enough to educate an ignorant wench?
What exactly is/comprises "shadow inventory"? And how/why is it estimated at 30%?
From Charlie Poole's comment,am gleaning that as NAR figures are taken from the MLS, sales occurring "outside" the MLS should be kept in mind.
OK-- might that explain a wierd sale that happened in my hood recently? A widow lady had a big ole house in semi-decent condition (livable, but her not-so-handyman husband had done all the work on it for years-- badly...)) up for sale for well over a year with a realtor, & had reduced her price again this spring down to 270K but still no sale. (Similar size homes here, but in good condition, were selling here for around $330K-- well, they were selling-- nothing's sold here now since Christmas.)
Anyway, I learned from a pal who knows the lady that, desperate for the money, she told her realtor to just sell the damn home for what she could get.
So one day about 3 weeks ago, suddenly the street was filled with cars & people going into the house for some kind of "auction"-- put on by the realtor. The winning bidder came out crowing that she'd won it for 197K.
Can realtors hold "auctions" of their own dog listings?
& if so, does that mean the sale price won't be reported on the MLS, so it won't then bust the comps for all the other listings they're trying to sell?
(Sorry to ask such basic q's but as per Tanta's old post cited above am trying to move up from the like 5th percentile.)
(12thPercentile: 'I don't like people so (*being a realtor)'s not an option for me.' LOL'ing-- (& yet with such astute self-knowledge you still picked 12thPercentile as your username??
)
Might there be some double counting on the existing home sales? Is a Trustee Sale counted as a sale? And of course, when that REO does indeed sell, it is counted. Seems to me trustee sales should not count as legitimate sales. Any know for sure?
Thanks
falling house prices just started.
great graphs, thanks