Since the taxpayer will in the end bail out this economic mess, how many on this blog believe there will be meaningful tax reform? What shape should it take?
how many on this blog believe there will be meaningful tax reform?
It depends on who wins the election. As we all know people with credit can spend forever so long as they don't have to be responsible for the debt at the end of the game....
Frankly if Ben did helicopter around spraying money in all directions, it would probably do more good that concentrating the money in the people who are already well off.
The entire financial system is based on insanity as it exists now.
Call me crazy, but I suspect the default rate on HELOCs will get much worse before it gets better. Those homeowners still holding on now might decide differently when home prices continue to fall and then stagnate. They'll be looking at a mighty big hole and, with little hope, they will eventually stop making interest payments on the HELOCs along with stopping their mortgage payments. Banks won't like that in Florida or anywhere else. I suggest an ultimate default rate of around 30% of HELOC users in Florida.
I wish CR would stop doing these negative news posts. Yes, things are bad and getting worse, but we can see the light at the end of the tunnel so the market goes, and since that's why some of us are here, that's all that matters and we don't need to read more of this negative stuff.
Wachovia Corp., the nation's fourth largest bank, reported that it had lost $8.86 billion in the second quarter due to soaring bad mortgage debt. It said it would slash its dividend and eliminate 10,750 positions out of a work force of roughly 120,000 employees.
Ok, Clownass (Paulson) you don't gain confidence or aid stability by pumping up stocks for wall street and friends of Angelo and your buddies @ Goldman -- you old creep, you know damn well you CAN'T save The Dividend of faltering, failing banks that have been mis-managed, manipulated and involved in criminal collusion!
You may talk about stability or be able to use taxpayer money for bailouts and aid your buddies, but what people want IMHO, is justice in the form of CEOs and CFOs that abused shareholders; I know I want justice in the form of watching your snake friends, like Ken Lay, spend time in jail, and or, spend time in Aspen, uo until the time they cash in their black souls and return to the devil, which is where you belong in a big evil fest, where you can reign as the person that brings about stability!
Miami Herald:Ex-convicts active in mortgage fraud "When Scott Almeida walked out of federal prison and into the mortgage business, he took a gamble. He admitted on his license application that he had been convicted of cocaine trafficking.
Florida regulators -- responsible for protecting borrowers from predatory brokers -- could have rejected him on the spot . . ." but guess what, etc.
"Significant income losses are also negatively affecting a growing number of borrowers ability to repay home equity loans.
I'd like to see the data behind that one. How many borrowers actually lost their jobs versus how many had to face the reality of their actual income level?
The U.S. office vacancy rate climbed in the second quarter amid decreasing demand and new deliveries of space, according to research by Colliers International. Downtown rents showed modest increases but suburban office properties have begun to feel the impact of the slowing economy as those rents edged downward.
Nationwide, the office vacancy rate in the second quarter jumped 27 basis points from the previous quarter to 13.24%, marking the third consecutive quarterly increase in office vacancy. Driving that trend are both decreasing demand and increasing supply, according to Ross Moore, executive vice president for market and economic research at Colliers International.
Absorption went negative in both quarters during the first half of this year, which means office users vacated more space than they leased. Second-quarter office usage contracted by 1.4 million sq. ft., Colliers found, in stark contrast to the 21.2 million sq. ft. of absorption recorded a year ago. Since the first of this year, tenants have returned 5.1 million sq. ft. back onto the office market.
In the fourth quarter of 2007 we had positive absorption but unfortunately we had more new supply, hence a rise in vacancy, Moore says. This year, theres negative absorption and lots of supply.
Any opinions on the recent talk out of the FASB about the changes to FAS 140 that may be put out in Aug? If passed would be very negative to most banks balance sheets.
Ok, Clownass (Paulson) you don't gain confidence or aid stability by pumping up stocks for wall street and friends of Angelo and your buddies @ Goldman --
Moody's may cut WaMu debt into junk territory
NEW YORK, July 22 (Reuters) - Moody's Investors Service on Tuesday said it may cut its ratings on Washington Mutual Inc's (WM.N: Quote, Profile, Research, Stock Buzz) senior unsecured debt into junk territory, after the largest U.S. savings and loan posted a $3.33 billion second-quarter loss.
The net loss equaled $6.58 per share as souring mortgages forced it to set aside more money for loan losses. For details, see [ID:nN22322548]
"WaMu's asset quality issues primarily relate to the company's residential mortgage portfolio, but deterioration is also being experienced in the company's credit card portfolio," Moody's said in a statement.
"To establish the necessary provisioning for this asset quality deterioration, Moody's expects WaMu to record sizable quarterly losses through 2009," the rating agency said.
Moody's said it may cut WaMu's unsecured debt into junk territory, from "Baa3," the lowest investment grade.
The cost of construction for these new offices is so high that they cannot compete with existing space. There is about a 25% premium for new space versus existing in many markets. As office supply increases by companies downsizing space, rents will fall. Companies will not be able to justify or afford the price premium for newly constructed space. As a result, the offices will go back to there lenders as they cannot meet debt obligations. The same scenario will play out with existing offices that were bought at very low cap rates.
I spent part of the morning watching them tear the i-omega letters off of the building next to me. I think we're one of the last tenants in the building, at least the parking lot is much easier to navigate now...
Spoke to some folks I know who live in S. Florida. They had Option ARMs on mutiple properties, as did everyone they knew, and they have all just within the last couple of months stopped paying their mortgage and heloc payments on all of their properties. They were all making pretty good money so able to keep up with payments for the last couple of years while hoping for a turnaround, but once one person in a peer group stops paying and starts telling their friends that they are living rent free, and the turnaround starts looking less and less likely, it starts to become socially acceptable to just stop paying. In fact, it starts to look like the intelligent thing to do. Sounded to me like this summer was the point when that option really started to become socially acceptable and we aren't even close to that momentum coming to a stop. Three years ago in Florida, everyone at the bars and clubs talked about how they were buying real estate. More and more now, everyone is talking about how they are walking away from their properties. This RF news is not surprising in that light.
Re: "My Life: The Prisoner scared the hell out of me when I was a kid. That relentless bubble... it would ALWAYS get him."
Bubbles are always challenging for children, and in most cases, clowns are even worse, and this is what is so awful today, we have clowns in The WhiteHouse and a huge bubble which we can't escape. I guess that was obvious and not worth saying, but in the world of blogs, one must seek continuity!
Re: Another study found that a twelve-step program's focus on self-admission of having a problem increases deviant stigma and strips members of their previous cultural identity replacing it with the deviant identity.[34] A survey of twelve-step group members, however, found they had a bicultural identity and saw twelve-step programs as a complement to their other national, ethnic, and religious cultures
"Come january paulson will go back to a cushy job on ws and get tens of millions in compensation "
Well there's one thumblewit on board cheering for
crony corruption to continue. So enough, do you pour sweat, stare google-eyed and splay your fingers as you lie, just like your gombah Paulson?
I would also add that alot of folks in Fla were paying their mortgage payments using HELOC money. Once that HELOC money started to get cutoff by the lenders, which really just started happening this year, the mortgage payments became alot tougher to make. Then what does one do if they'd been paying a minimum payment on a speculative RE purchase? They can't refinance, they've added negative amortization onto the loan balance and their property value has gone down, unless they bring a ton of cash to the deal which they don't have. They can't rent for enough to cover expenses. They can't sell without doing a short sale, which most lenders won't approve until the borrower has already stopped making payments to show/prove distress. Then, boom, they hit the neg am cap and don't have the choice to make the minimum payment anymore. These folks, and there are a ton of them out there in areas like Florida and California, are boxed in by the bad decisions they made a couple of year ago. The only thing they can do is stop paying. More have started to do so this year and the ball is still rolling and won't stop for a while. It's going to get worse before it gets better.
More and more now, everyone is talking about how they are walking away from their properties. This RF news is not surprising in that light.
This is exactly what a gay friend of mine who bought a condo in South Florida said. A lot of gays from the East Coast went down to Miami and bought condos in gay-oriented communities. They might rent them out to straight people, but most of the social life is gay.
Gays tend to be pretty honorable about paying their debts. But now, they are walking away, too. It's not a gay stigma thing anymore to default. It's almost like gay pride to stick it to the man. I guess you could say that walk-aways are coming out of the closet.
...but we can see the light at the end of the tunnel...and since that's why some of us are here, that's all that matters and we don't need to read more of this negative stuff.
Is this guy kidding? We're in the middle of the most severe financial and housing market turn down since the Great Depression and he doesn't want to read "negative stuff" anymore.
Hey, go over NAR's website and read the happy news there!
tabasco: Interesting post. I've been wondering about that myself.
The future of housing looks grim...
Many buyers will trash their credit as lending standards tighten. So 'bye bye' demand.
Supply skyrockets. (They are still in the act of building tracts and tracts of new homes near me.)
Interest rates eventually rise. Prices fall further accordingly.
SoCal and Fla layoffs lead to more FCs.
CSC,
The future of housing has already been written. The future of CRE has already been writen. The future of small and mid-sized banks has already been written. It is getting hard to find original things to write anymore.
BXP is a developer in disguise... They develop highrises for tenants with high credit ratings. I've been short reits and commercial for a while but I've stayed away from them. (Granted I dont have the huevos to go long either!)
Oh I have no position there either - I am just getting curious - if they had something to crow about it seems like they would be doing it! That, and it is market chatter that is actually on topic for the blog...
The CMBX series are almost all trading at new (new) lows and the ABX series is bouncing along the bottom.
If oil continues to drop, we'll be able to perform the monetization necessary to recover from these bad credits. If not, well, we won't. Keep watching it.
Look, stop complaining about the PPT. If you believe that it exists, then it's your job as an investor to factor that into your decisions. If you don't then it's your own damn fault.
Elvis, I agree it was all baked in long ago. This is the first time though that I've heard some of the people in Fla that did the baking admitting that, though. The last couple years I could tell stuff was getting to them, they'd mention how they had $10K in mortgage payments every month on their 5 properties (it wasn't a problem before when everything was going up, they'd just sell something every few month and then double down), but they always said they were still paying and just trying to hold on until things would turn around. This summer it's different. There is no turnaround. They're out. And these aren't subprime borrowers. They aren't even house flipping wannabes with no real job, of which there were plenty around I'm sure. Those were the first to get burned and they've been taken care of already. These are what I think made up the largest portion of the real estate investment mania: people with excess income looking for ways to get rich and choosing real estate over the stock market with the help of their oh so helpful buddy who had a real estate license and would find them the best pre-construction deals around. Alot of these people had been hanging around, still making their mortgage payments while burning through heloc money and their excess income, hoping to make it until the turnaround and without ruining their credit. And these are the people finally starting to walk away. This, I fear, is when it starts to get really ugly for the banks. We are all subprime, indeed.
These morons would have lost less money if they would have all stayed home and masturbated (for years), versus going to work and doing this:
... the company announced a staggering $8.66 billion dollar loss for the most recent quarter, a loss equivalent to $4.20 per share. In addition, WB notched $6.1 billion in write downs, cut the dividend by 87% from $.375 to $.05 and announced job lay offs of 6,350 workers, about 5% of the companies workforce. Loan loss provisions exploded by 3100% showing that management was entirely blindsided by the collapse in housing and mortgage related debt.
Aheadofthecurve writes:
Look, stop complaining about the PPT. If you believe that it exists, then it's your job as an investor to factor that into your decisions. If you don't then it's your own damn fault.
Aheadofthecurve | 07.22.08 - 6:44 pm -
Who said I hadn't.
This will not end well. Government can't controle the Markets in the long run.
I read the news today and tried to summon a sense of impact, or panic or anything beyond derision.
Failed. Now I am truly fitting this song:
Comfortably Numb (Gilmour, Waters) 6:49
Hello?
Is there anybody in there?
Just nod if you can hear me.
Is there anyone at home?
Come on, now,
I hear you're feeling down.
Well I can ease your pain
Get you on your feet again.
Relax.
I'll need some information first.
Just the basic facts.
Can you show me where it hurts?
There is no pain you are receding
A distant ship, smoke on the horizon.
You are only coming through in waves.
Your lips move but I can't hear what you're saying.
When I was a child I had a fever
My hands felt just like two balloons.
Now I've got that feeling once again
I can't explain you would not understand
This is not how I am.
I have become comfortably numb.
O.K.
Just a little pinprick.
There'll be no more aaaaaaaaah!
But you may feel a little sick.
Can you stand up?
I do believe it's working, good.
That'll keep you going through the show
Come on it's time to go.
There is no pain you are receding
A distant ship, smoke on the horizon.
You are only coming through in waves.
Your lips move but I can't hear what you're saying.
When I was a child
I caught a fleeting glimpse
Out of the corner of my eye.
I turned to look but it was gone
I cannot put my finger on it now
The child is grown,
The dream is gone.
I have become comfortably numb.
The financial follies are beyond comprehension. When folks start talking about mass flight from property the system is now well and truly broken.
Who is going to finance the sale of the REOs? The credit quality demanded is insanely high now. If those REOs are going to sell at all to anybody, people with a few credit dings are gonna have to get qualified.
Otherwise the only buyers will be all cash or hard equity.
I have posted a few tangential posts in my time, but I'm going through a 12 step plan.. is this OT? Not really, because you brought it up and I think that is on point as well.
These morons would have lost less money if they would have all stayed home and masturbated (for years), versus going to work and doing this:
Actually...
Washington Mutual (NYSE: WM), the nation's largest thrift institution, announced a new compensation plan Wednesday that would protect its top executives' annual bonuses. Specifically, performance targets used to evaluate executives' performance will be calculated without factoring in some of the damage mortgage losses and foreclosures have caused.
The dudes running the show got their cake regardless. They had no incentive not to lose money in the long run.
Alot of those REOs will end up being sold in blocks to institutional buyers. There are vulture funds out there just sitting on their hands right now, and rightfully so. Remember that guy Jack McCabe who was quoted in almost every Florida real estate article from 2005-2006 talking about how it was going to crash and mentioning that he was putting together a vulture fund. If you don't remeber him, google his name. Wonder why we haven't heard from him lately? After all, he was spot on with all of his predictions. My guess would be he's got his fund setup and they are waiting. The banks won't have anyone else to sell to, and when the institutional buyers think the bust has been exhausted, they'll step in. It happened in the 90s, too. Vulture funds bought California REOs for 20 or 30 cents on the dollar. First though, the supply of REOs has to stabilize a little bit. Smart institutional buyers would not step in and buy while foreclosures (future REO innentory) are still increasing, and we're along, long, way off from that happening.
Tabasco, I'm curious too who it will be ultimately. I'm thinking they won't be making the big purchases until 2010/2011 if this whole economy can keep grinding down as slowly as it has been.
brian is a busy boy indeed.....
Ciao
MS
Since the taxpayer will in the end bail out this economic mess, how many on this blog believe there will be meaningful tax reform? What shape should it take?
how many on this blog believe there will be meaningful tax reform?
It depends on who wins the election. As we all know people with credit can spend forever so long as they don't have to be responsible for the debt at the end of the game....
........................
The Fed needs to open the discount window to homeowners and extend the terms to 90 years.
Problem solved.
Frankly if Ben did helicopter around spraying money in all directions, it would probably do more good that concentrating the money in the people who are already well off.
The entire financial system is based on insanity as it exists now.
Good idea Lucky. I'd do if those who didn't pay back the Government were executed to improve the gene pool.
Call me crazy, but I suspect the default rate on HELOCs will get much worse before it gets better. Those homeowners still holding on now might decide differently when home prices continue to fall and then stagnate. They'll be looking at a mighty big hole and, with little hope, they will eventually stop making interest payments on the HELOCs along with stopping their mortgage payments. Banks won't like that in Florida or anywhere else. I suggest an ultimate default rate of around 30% of HELOC users in Florida.
props to scav for the map update on the Philly Fed coincident indicator maps post down thread - nice!
The issue was clarity of the comparison - now we have it, thanks to scav.
I wish CR would stop doing these negative news posts. Yes, things are bad and getting worse, but we can see the light at the end of the tunnel so the market goes, and since that's why some of us are here, that's all that matters and we don't need to read more of this negative stuff.
Enough negativism, we are all here for the negative news! We love it.
"we can see the light at the end of the tunnel"
Yes. That's a train.
"we can see the light at the end of the tunnel"
That isn't a light. That is a dead canary.
but we can see the light at the end of the tunnel so the market goes
That light might be asphyxiation....
I hate to sound negative but I don't know if we're close to the end of the tunnel....
Its going to hurt a lot more for a lot more people before it gets better...
................
Yes. That's a train.
LOL ! ! !
.......................
"Dead canary? Where? I haven't eaten in days."
"how many on this blog believe there will be meaningful tax reform?"
People here pay actualy pay taxes. WTF
And are sorry that we pay taxes!
This is going to be beyond ugly.
I have now heard of houses that have been totally stripped in south Phoenix- firsthand from a lady that lives next door.
It was a new infill in 2005- the door and window frames have been stripped for the aluminum, the ac unit is gone, all of the plumbing is gone.
It is now a see through.
I guess that is a bulldozer job now.
From inhabited to destroyed in one year, new to destroyed in three years.
That is some capital destruction!!!
Inspect before you buy!!!
Someday this war's gonna end...
Paulson says financial stability is top priority
The article requested is no longer available.
Wachovia Corp., the nation's fourth largest bank, reported that it had lost $8.86 billion in the second quarter due to soaring bad mortgage debt. It said it would slash its dividend and eliminate 10,750 positions out of a work force of roughly 120,000 employees.
Ok, Clownass (Paulson) you don't gain confidence or aid stability by pumping up stocks for wall street and friends of Angelo and your buddies @ Goldman -- you old creep, you know damn well you CAN'T save The Dividend of faltering, failing banks that have been mis-managed, manipulated and involved in criminal collusion!
You may talk about stability or be able to use taxpayer money for bailouts and aid your buddies, but what people want IMHO, is justice in the form of CEOs and CFOs that abused shareholders; I know I want justice in the form of watching your snake friends, like Ken Lay, spend time in jail, and or, spend time in Aspen, uo until the time they cash in their black souls and return to the devil, which is where you belong in a big evil fest, where you can reign as the person that brings about stability!
Kiss my ass, you retard!
Speaking of Florida:
It turns out some Florida mortgage brokers were criminals before they collected YSP
Miami Herald:Ex-convicts active in mortgage fraud
"When Scott Almeida walked out of federal prison and into the mortgage business, he took a gamble. He admitted on his license application that he had been convicted of cocaine trafficking.
Florida regulators -- responsible for protecting borrowers from predatory brokers -- could have rejected him on the spot . . ." but guess what, etc.
Well, at least they can't vote for President.
"Significant income losses are also negatively affecting a growing number of borrowers ability to repay home equity loans.
I'd like to see the data behind that one. How many borrowers actually lost their jobs versus how many had to face the reality of their actual income level?
Warning more negative news below....
Office Fundamentals Weaken in Second Quarter
The U.S. office vacancy rate climbed in the second quarter amid decreasing demand and new deliveries of space, according to research by Colliers International. Downtown rents showed modest increases but suburban office properties have begun to feel the impact of the slowing economy as those rents edged downward.
Nationwide, the office vacancy rate in the second quarter jumped 27 basis points from the previous quarter to 13.24%, marking the third consecutive quarterly increase in office vacancy. Driving that trend are both decreasing demand and increasing supply, according to Ross Moore, executive vice president for market and economic research at Colliers International.
Absorption went negative in both quarters during the first half of this year, which means office users vacated more space than they leased. Second-quarter office usage contracted by 1.4 million sq. ft., Colliers found, in stark contrast to the 21.2 million sq. ft. of absorption recorded a year ago. Since the first of this year, tenants have returned 5.1 million sq. ft. back onto the office market.
In the fourth quarter of 2007 we had positive absorption but unfortunately we had more new supply, hence a rise in vacancy, Moore says. This year, theres negative absorption and lots of supply.
http://nreionline.com/property/office/office_fundamental_weaken_0722/
................
Any opinions on the recent talk out of the FASB about the changes to FAS 140 that may be put out in Aug? If passed would be very negative to most banks balance sheets.
Kiss my ass, you retard!
Come january paulson will go back to a cushy job on ws and get tens of millions in compensation and you'll still be whining here. who's the retard?
IndyMac Dividend Yield,
I really liked your speech to Paulson.
I dare you to go up and say it to his face.
Moody's may cut WaMu debt into junk territory
NEW YORK, July 22 (Reuters) - Moody's Investors Service on Tuesday said it may cut its ratings on Washington Mutual Inc's (WM.N: Quote, Profile, Research, Stock Buzz) senior unsecured debt into junk territory, after the largest U.S. savings and loan posted a $3.33 billion second-quarter loss.
The net loss equaled $6.58 per share as souring mortgages forced it to set aside more money for loan losses. For details, see [ID:nN22322548]
"WaMu's asset quality issues primarily relate to the company's residential mortgage portfolio, but deterioration is also being experienced in the company's credit card portfolio," Moody's said in a statement.
"To establish the necessary provisioning for this asset quality deterioration, Moody's expects WaMu to record sizable quarterly losses through 2009," the rating agency said.
Moody's said it may cut WaMu's unsecured debt into junk territory, from "Baa3," the lowest investment grade.
[snip]
@nades writes:
Warning more negative news below....
LOL
When it comes to second liens, the good news for the banks is: "You will get nothing and like it."
The cost of construction for these new offices is so high that they cannot compete with existing space. There is about a 25% premium for new space versus existing in many markets. As office supply increases by companies downsizing space, rents will fall. Companies will not be able to justify or afford the price premium for newly constructed space. As a result, the offices will go back to there lenders as they cannot meet debt obligations. The same scenario will play out with existing offices that were bought at very low cap rates.
energyecon, wrong link!
o , anon, some of us have opted out.
i'm waiting for my day in court.
Elvis,
I spent part of the morning watching them tear the i-omega letters off of the building next to me. I think we're one of the last tenants in the building, at least the parking lot is much easier to navigate now...
...................
Spoke to some folks I know who live in S. Florida. They had Option ARMs on mutiple properties, as did everyone they knew, and they have all just within the last couple of months stopped paying their mortgage and heloc payments on all of their properties. They were all making pretty good money so able to keep up with payments for the last couple of years while hoping for a turnaround, but once one person in a peer group stops paying and starts telling their friends that they are living rent free, and the turnaround starts looking less and less likely, it starts to become socially acceptable to just stop paying. In fact, it starts to look like the intelligent thing to do. Sounded to me like this summer was the point when that option really started to become socially acceptable and we aren't even close to that momentum coming to a stop. Three years ago in Florida, everyone at the bars and clubs talked about how they were buying real estate. More and more now, everyone is talking about how they are walking away from their properties. This RF news is not surprising in that light.
Re: "My Life: The Prisoner scared the hell out of me when I was a kid. That relentless bubble... it would ALWAYS get him."
Bubbles are always challenging for children, and in most cases, clowns are even worse, and this is what is so awful today, we have clowns in The WhiteHouse and a huge bubble which we can't escape. I guess that was obvious and not worth saying, but in the world of blogs, one must seek continuity!
Re: Another study found that a twelve-step program's focus on self-admission of having a problem increases deviant stigma and strips members of their previous cultural identity replacing it with the deviant identity.[34] A survey of twelve-step group members, however, found they had a bicultural identity and saw twelve-step programs as a complement to their other national, ethnic, and religious cultures
"Come january paulson will go back to a cushy job on ws and get tens of millions in compensation "
Well there's one thumblewit on board cheering for
crony corruption to continue. So enough, do you pour sweat, stare google-eyed and splay your fingers as you lie, just like your gombah Paulson?
Re-posting with a d'oh!
Moody's may cut WaMu debt into junk territory
I would also add that alot of folks in Fla were paying their mortgage payments using HELOC money. Once that HELOC money started to get cutoff by the lenders, which really just started happening this year, the mortgage payments became alot tougher to make. Then what does one do if they'd been paying a minimum payment on a speculative RE purchase? They can't refinance, they've added negative amortization onto the loan balance and their property value has gone down, unless they bring a ton of cash to the deal which they don't have. They can't rent for enough to cover expenses. They can't sell without doing a short sale, which most lenders won't approve until the borrower has already stopped making payments to show/prove distress. Then, boom, they hit the neg am cap and don't have the choice to make the minimum payment anymore. These folks, and there are a ton of them out there in areas like Florida and California, are boxed in by the bad decisions they made a couple of year ago. The only thing they can do is stop paying. More have started to do so this year and the ball is still rolling and won't stop for a while. It's going to get worse before it gets better.
This is exactly what a gay friend of mine who bought a condo in South Florida said. A lot of gays from the East Coast went down to Miami and bought condos in gay-oriented communities. They might rent them out to straight people, but most of the social life is gay.
Gays tend to be pretty honorable about paying their debts. But now, they are walking away, too. It's not a gay stigma thing anymore to default. It's almost like gay pride to stick it to the man. I guess you could say that walk-aways are coming out of the closet.
...but we can see the light at the end of the tunnel...and since that's why some of us are here, that's all that matters and we don't need to read more of this negative stuff.
Is this guy kidding? We're in the middle of the most severe financial and housing market turn down since the Great Depression and he doesn't want to read "negative stuff" anymore.
Hey, go over NAR's website and read the happy news there!
Well doggone it when is BXP gonna give it up?
They have had a heck of a run - up 12% over the last five trading days - they just bought into a trophy building along with GS and some Dubai money...
rich,
Are you baiting us?
tabasco: Interesting post. I've been wondering about that myself.
The future of housing looks grim...
Many buyers will trash their credit as lending standards tighten. So 'bye bye' demand.
Supply skyrockets. (They are still in the act of building tracts and tracts of new homes near me.)
Interest rates eventually rise. Prices fall further accordingly.
SoCal and Fla layoffs lead to more FCs.
That's a doodoo storm.
CSC,
The future of housing has already been written. The future of CRE has already been writen. The future of small and mid-sized banks has already been written. It is getting hard to find original things to write anymore.
energycon,
BXP is a developer in disguise... They develop highrises for tenants with high credit ratings. I've been short reits and commercial for a while but I've stayed away from them. (Granted I dont have the huevos to go long either!)
................
Re: I really liked your speech to Paulson.
I dare you to go up and say it to his face.
Bring the stuttering kneeling bastard before me, and I'll spill my guts and then take him to the hanging judge!
Hey, go over NAR's website and read the happy news there!
Spiv
thats plain mean!
.............
ades,
Oh I have no position there either - I am just getting curious - if they had something to crow about it seems like they would be doing it! That, and it is market chatter that is actually on topic for the blog...
Elvis: I was actually hoping you'd call me an idiot and tell me why I'm a "doom and gloom"er.
I need a toke.
The CMBX series are almost all trading at new (new) lows and the ABX series is bouncing along the bottom.
If oil continues to drop, we'll be able to perform the monetization necessary to recover from these bad credits. If not, well, we won't. Keep watching it.
Its not surprising how todays chart on the Dow looks very similar to that of the Nikkei from last night.
PPT to the rescue.
energycon,
I concur, that measly dividend isnt enough to justify the price. I did notice that all the REITs were up today. Odd...
.................
Second the appreciation of the nice work by Scav on standardizing the philly fed maps.
Looks a bit uglier now.
Look, stop complaining about the PPT. If you believe that it exists, then it's your job as an investor to factor that into your decisions. If you don't then it's your own damn fault.
I concur, that measly dividend isnt enough to justify the price. I did notice that all the REITs were up today. Odd...
Let's hope that continues for a few weeks. If SRS gets any cheaper it will take all the excitement out of buying it.
Pardon, should be clear: new relative worst levels on the CMBX, as some blew out to crazy pricing during the March liquidity crisis.
This is a much more measured, rational, paced decline.
Elvis, I agree it was all baked in long ago. This is the first time though that I've heard some of the people in Fla that did the baking admitting that, though. The last couple years I could tell stuff was getting to them, they'd mention how they had $10K in mortgage payments every month on their 5 properties (it wasn't a problem before when everything was going up, they'd just sell something every few month and then double down), but they always said they were still paying and just trying to hold on until things would turn around. This summer it's different. There is no turnaround. They're out. And these aren't subprime borrowers. They aren't even house flipping wannabes with no real job, of which there were plenty around I'm sure. Those were the first to get burned and they've been taken care of already. These are what I think made up the largest portion of the real estate investment mania: people with excess income looking for ways to get rich and choosing real estate over the stock market with the help of their oh so helpful buddy who had a real estate license and would find them the best pre-construction deals around. Alot of these people had been hanging around, still making their mortgage payments while burning through heloc money and their excess income, hoping to make it until the turnaround and without ruining their credit. And these are the people finally starting to walk away. This, I fear, is when it starts to get really ugly for the banks. We are all subprime, indeed.
"alot of folks in Fla were paying their mortgage payments using HELOC money"
aka borrowing from paul to pay paul.
These morons would have lost less money if they would have all stayed home and masturbated (for years), versus going to work and doing this:
... the company announced a staggering $8.66 billion dollar loss for the most recent quarter, a loss equivalent to $4.20 per share. In addition, WB notched $6.1 billion in write downs, cut the dividend by 87% from $.375 to $.05 and announced job lay offs of 6,350 workers, about 5% of the companies workforce. Loan loss provisions exploded by 3100% showing that management was entirely blindsided by the collapse in housing and mortgage related debt.
Aheadofthecurve writes:
Look, stop complaining about the PPT. If you believe that it exists, then it's your job as an investor to factor that into your decisions. If you don't then it's your own damn fault.
Aheadofthecurve | 07.22.08 - 6:44 pm -
Who said I hadn't.
This will not end well. Government can't controle the Markets in the long run.
Apologies once again for the vaguely tangential post:
If you watched that video of Kenny Langone on cnbc, remember how he talks about Spitzer's daughters? Scary guy.
"This will not end well."
Absolutely true. It will end with every single one of us dead. I guarantee that.
Go ahead and buy the financials. This market will suck you in and spit you out like a wood chopper.
I read the news today and tried to summon a sense of impact, or panic or anything beyond derision.
Failed. Now I am truly fitting this song:
Comfortably Numb (Gilmour, Waters) 6:49
Hello?
Is there anybody in there?
Just nod if you can hear me.
Is there anyone at home?
Come on, now,
I hear you're feeling down.
Well I can ease your pain
Get you on your feet again.
Relax.
I'll need some information first.
Just the basic facts.
Can you show me where it hurts?
There is no pain you are receding
A distant ship, smoke on the horizon.
You are only coming through in waves.
Your lips move but I can't hear what you're saying.
When I was a child I had a fever
My hands felt just like two balloons.
Now I've got that feeling once again
I can't explain you would not understand
This is not how I am.
I have become comfortably numb.
O.K.
Just a little pinprick.
There'll be no more aaaaaaaaah!
But you may feel a little sick.
Can you stand up?
I do believe it's working, good.
That'll keep you going through the show
Come on it's time to go.
There is no pain you are receding
A distant ship, smoke on the horizon.
You are only coming through in waves.
Your lips move but I can't hear what you're saying.
When I was a child
I caught a fleeting glimpse
Out of the corner of my eye.
I turned to look but it was gone
I cannot put my finger on it now
The child is grown,
The dream is gone.
I have become comfortably numb.
The financial follies are beyond comprehension. When folks start talking about mass flight from property the system is now well and truly broken.
And yet the homebuilders rallied!
Someday this war's gonna end...
You are absolutely right tabasco.
To repeat what I posted below:
Who is going to finance the sale of the REOs? The credit quality demanded is insanely high now. If those REOs are going to sell at all to anybody, people with a few credit dings are gonna have to get qualified.
Otherwise the only buyers will be all cash or hard equity.
We are all hard equity now.
Good Tuesday song (IMHO): YouTube - Badfinger - Sweet Tuesday Morning
Dividends! You can't play accounting fraud games -- and send shareholders div checks!!!
I have posted a few tangential posts in my time, but I'm going through a 12 step plan.. is this OT? Not really, because you brought it up and I think that is on point as well.
BTW, did anyone notice that Wachovia is eliminating 10K jobs?
Still for the grasp of me can't understand why people say that the real economy won't be affected...
These morons would have lost less money if they would have all stayed home and masturbated (for years), versus going to work and doing this:
Actually...
Washington Mutual (NYSE: WM), the nation's largest thrift institution, announced a new compensation plan Wednesday that would protect its top executives' annual bonuses. Specifically, performance targets used to evaluate executives' performance will be calculated without factoring in some of the damage mortgage losses and foreclosures have caused.
The dudes running the show got their cake regardless. They had no incentive not to lose money in the long run.
They can masturbate all they want now.
Washington Mutual's Shady Compensation Plan (WAMUQ.PK)
Link from above.
Otherwise the only buyers will be all cash or hard equity.
Exactly.
"Who is going to finance the sale of the REOs? "
What I'm waiting to see is if a couple of large, conveniently poised companies will come in and buy up all this constipated property for pennies.
...or for new legislation that allows municipalities to liquidate it. Watch the corruption at that point.
"These morons would have lost less money if they would have all stayed home and masturbated (for years)"
They didn't need to, they could do it their plush golden offices.
Let's make a deal. We still use rope, but we'll line it with silk.
We are all unsecured debt now!
Alot of those REOs will end up being sold in blocks to institutional buyers. There are vulture funds out there just sitting on their hands right now, and rightfully so. Remember that guy Jack McCabe who was quoted in almost every Florida real estate article from 2005-2006 talking about how it was going to crash and mentioning that he was putting together a vulture fund. If you don't remeber him, google his name. Wonder why we haven't heard from him lately? After all, he was spot on with all of his predictions. My guess would be he's got his fund setup and they are waiting. The banks won't have anyone else to sell to, and when the institutional buyers think the bust has been exhausted, they'll step in. It happened in the 90s, too. Vulture funds bought California REOs for 20 or 30 cents on the dollar. First though, the supply of REOs has to stabilize a little bit. Smart institutional buyers would not step in and buy while foreclosures (future REO innentory) are still increasing, and we're along, long, way off from that happening.
Uncle billy, you beat me to it, and alot more succinctly.
AllanM - where are the stripped houses in S Phx? Please email me at ctx_coverage@yahoo.com with details
Tabasco, I'm curious too who it will be ultimately. I'm thinking they won't be making the big purchases until 2010/2011 if this whole economy can keep grinding down as slowly as it has been.
Here's an excellent article by Henry CK Liu "Debt Capitalism Self-destructs".
Every DC rep. should study it, along with those that vote them in or out.
Asia Times Online :: Asian news and current affairs
CR, I'd like to see brian post.
Brian, you can post on my blog anytime.
...or for new legislation that allows municipalities to liquidate it. Watch the corruption at that point.
It's nice to know I'm not the only one who thought that.