JS-Kit does not scale well. This comment from Mish's tells the tale: mish, I analyzed your page using yslow (its a firefox plugin) and it seems like you have very heavy javascript usage as compared to calculated risk. see first image for stats on your blog. javascript files are 267k even when cached. In addition the site makes 57 http request compared to 50 by calc risk. Finally calc risk does a bitter job of caching images, this may have to do with expiration headers etc on the page. The second graphic is stats from calc risk page. In terms of javascript file size, a significant number of this is coming from js-kit. regards
CR, if you go to JS Kit, can we skip the avatars? It's the only thing I really dislike over at mish's new comments section, which are otherwise very good.
I'm loving it that the market can take good news and go up. And it can take bad news and ignore it and move up. At this rate I'll be a millionaire while every company in the S&P is BK and all jobs reside in India.
INDIANAPOLIS (AP) Stocking up on aspirin by Wednesday night will do more than blunt a New Years Day hangover for many people across the country. Purchases like that also help employees who hold health Flexible Spending Accounts whittle their balances before 2008 ends and, in many cases, they forfeit their money. \tBenefits experts say there are several last-minute ways to use leftover money in these accounts. FSAs give consumers possible tax savings by letting them use money from payroll deductions on certain health-related expenses. People with accounts that must be used by Dec. 31 have no time to schedule a medical procedure. Even squeezing in an eye exam may prove impossible, so its time to start thinking about the small items. Band-Aids, cough syrup, laxatives and even condoms are all eligible for flex spending dollars.
Dunno. I don't typically comment over at Mish's (he had horrific battles with some commenters for months, before he started banning the worst of them), so I don't know about JsKit much. I do like my CR Companion, I have to say ... and I'll miss it dearly. Barry bans 'First!' posts, but that's asthetic, not technical.
Not fond of the avatars - but I do wonder what Conjure Bag's would be.
Hopefully next week I'll be moving to the new JS-Kit commenting system. This should help with improving the quality of the comments.
In my humble opinion, there is no technological fix for the problem except constant, manual vigilance by the administrator. Even some jawboning, like Bernanke, in the form of stern warnings and threats from the management, would go a long way. (Bears' Chat comments are by registration and they're still patrolled regularly.)
In any case, didn't you try JS-Kit once before, and then quickly went back to HaloScan?
OP-ED COLUMNIST; Add Up The Damage - NY Times
Add Up the Damage
And then theres the Bush economy, another disaster, a trapdoor through which middle-class Americans can plunge toward the bracing experiences normally reserved for the poor and the destitute.
Mr. Bush traveled the country in the early days of his presidency, promoting his tax cut plans as hugely beneficial to small-business people and families of modest means. This was more deceit. The tax cuts would go overwhelmingly to the very rich. The president would give the wealthy and the powerful virtually everything they wanted. He would throw sand into the regulatory apparatus and help foster the most extreme income disparities since the years leading up to the Great Depression. Once again he was lighting a fire. This time the flames would engulf the economy and, as with Iraq, bring catastrophe. If the U.S. were a product line, it would be seen now as deeply damaged goods, subject to recall. There seemed to be no end to Mr. Bushs talent for destruction. He tried to hand the piggy bank known as Social Security over to the marauders of the financial sector, but saner heads prevailed...
Cliffo: The reason to go back to JS-kit is that they now support OpenID... so posters can be more readily verified and banned. It will prevent the name stealing shenanigans.
I'm considering updating CR Companion to support the new format. CR was his usual gracious self, and gave me a heads up last week, but I can't be clear on the impact until it's up and running. I'll keep you posted.
Mish's site is by far the slowest loading blog I visit - the blog not the comments. Takes like 25 seconds before the scroll key works compared with maybe 3-4 seconds for CR and the BP (modem working flatout the entire time). Perhaps that is the Java issue in an earlier comment. Before changing over it might serve to do some timing comparisons.
BTW, I'm impressed with the restraint everyone has here of not responding to trolls. Seen it lots of times where a troll will be left swinging in the wind while everyone else just ignores him.
NO!!!!!!!!!!!!!!!!!!!!!
crispy&cole | Homepage | 12.30.08 - 3:11 pm | #
I'll be posting my pizza news on the blackboard at Cavalli's Pizza Parlor in Irving, TX near DFW airport.
I'd like to request that the new format doesn't use the pagination. When you refresh Shedlock's site, you have to scroll up to the page numbers and click on the last page to get back to where you were. PIA.
I can only tolerate Mish in small doses. He quickly ignores or summarily dismisses data when it doesn't agree with his preCONceived conclusion of deflation.
I wish I could see the future as clearly as Mish. I'd no doubt be wealthy and famous.
'm considering updating CR Companion to support the new format. CR was his usual gracious self, and gave me a heads up last week, but I can't be clear on the impact until it's up and running. I'll keep you posted. Ken Cooper | Homepage | 12.30.08 - 3:10 pm | #
Mish's site is by far the slowest loading blog I visit - the blog not the comments. Takes like 25 seconds before the scroll key works compared with maybe 3-4 seconds for CR and the BP (modem working flatout the entire time). Perhaps that is the Java issue in an earlier comment. Before changing over it might serve to do some timing comparisons. NC Jim | 12.30.08 - 3:12 pm | #
for the good lord's sake, please please stick to Halo. Despite its disadvantages, it has a a neat and clean presentation.
I have stopped reading comments on Mish's site (despite loving his blog) after, particularly, the latest changes. It is butt-ugly (sorry Mish) and feels more like a teenager's forum!
So, please stick to a text only clean comments layout. I personally feel that the only drawback with your comments section is that, with the rising popularity if the blog, there way too many wasteful comments. But, that is the cost to be paid I guess. Barring that, please don't change a thing.
CR, we for the most part are adults and trolls are who they are. Self policing is usually the best way of enforcement.
This is a great informative blog and chat site.
Please DO NOT CHANGE A THING.
If Ken can combine the features of CR Companion with JS-Kit, it might be a four-bagger.
Actually, it will be like turning Crossfire into the NewsHour with Jim Lehrer. And I don't think that's a good thing, at all. On the other hand, you may enjoy Calculated Snooze.
briwerk writes:
Cliffo: The reason to go back to JS-kit is that they now support OpenID... so posters can be more readily verified and banned. It will prevent the name stealing shenanigans.
I've learned a lot here under the old comments rules or lack thereof.
1. Bongwater comes in flavors
2. Nighstand cowboy is not a dude
3. NorkaWest wears Victoria's Secret
4. Tanta was loved by millions
5. Fuck can be spelled 563 ways
6. Bush has 3.5 fans in Ohio
7. Condi Rice is not important at CR
8. Illegals buy McMansions w/pools
9. How to grow hops in my backyard
10. Gardening 101
11. CNBC sucks puppies
12. Life is hard in Vegas
13. Elvis lives
14. Heather Locklear is depressed
15. Paulson's pinkie/mind are twisted
16. China is pissed
17. Rotary clotheslines save energy
19. Hemp cup cakes keep you regular
20. Wood stoves are in fashio
Nesting is an option, but if you post without it, the nesters don't like it.
I think nesting would alter the conversational nature of this blog. I post frequently on many sites with nested comments, and I don't have any fundamental problem with them, but I think they'd change the flow of dialog here in a substantial way. I say don't risk messing too much with a good thing.
I think nesting would alter the conversational nature of this blog. I post frequently on many sites with nested comments, and I don't have any fundamental problem with them, but I think they'd change the flow of dialog here in a substantial way. I say don't risk messing too much with a good thing. ac | 12.30.08 - 3:40 pm | #
Thanks for working on the companion and I hope you can support it even with the move. I would be really sad to see it go... it lets me read CR even when I don't have time to look at the wittiest of comments.
Certainly the new format looks a bit more busy, and I don't see that it's any more searchable than halo (which is my biggest complaint).
I'm considering updating CR Companion to support the new format. CR was his usual gracious self, and gave me a heads up last week, but I can't be clear on the impact until it's up and running. I'll keep you posted. Ken Cooper | Homepage | 12.30.08 - 3:10 pm | #
CR- The best we can do is ignore the trolls. Like DRM, there is always a way around it. It's been more annoying recently, but readable (except perhaps for a couple of threads). I just hope that doesn't mean that you've been spending hours cleaning it up. Also love to see some of the older folks come back... even if it's just to get a taste of the new.
Dear SC/CR,
Can you please maintain two separate threads:
- one for comments related to your current post
- and another one for comments, well, not related to your current post (like Israel and Palestine, Christians and Muslims, Stalin and Hitler)
I promise I will read and post in both threads.
It will be all self-regulated and posters with good style (like CSC or Misean) will be welcome in both threads regardless of relevance of their comments. On the other hand, serial violators will be banished.
Thank you.
Nesting is a user option, so each person can view with it on or off. Small problem: if you get used to viewing in nest mode, when people post at the bottom, it can be annoying.
Also, I don't think JS Kit has a "Click here to refresh" so there's no knowing when a new post is up - that's my experience anyway.
For me that was in 2005 or so... dryfly | 12.30.08 - 3:51 pm | #
I was then still posting primarily on his board at SI. He was much more open then and there... We were also a team at themarkettraders. I like him as a person but don't always appreciate his not always flexible and forceful online persona. But I always had his respect and therefore we NEVER got into a fight despite having very obvious political differences.
BTW I am the guilty party as to why he is using JS-KIT.
Peak CR. Whocouldanode? A blog's life, and relevance, can be assessed by its comments stream. CR has reached The Peak, hence the censorship. It's downhill from here. Oh well, another will rise to take its place. It's the natural way of blogs, if there is such a thing.
CNNMoney.com: 404 Page Not Found
Banks cut lending by 55% in 2008
U.S. loan issuance fell to the lowest volume since 1994 as banks repair balance sheets, shun underwriting new, risky deals.
BTW I am the guilty party as to why he is using JS-KIT. RE | 12.30.08 - 3:59 pm | #
I see no problem w/ it - I'm flexible.
Also I have no doubt Mish is a decent guy in person and that the intertubez can really rub you raw. The latter is especially true for somebody like him who is both strongly opinionated AND calling shots on markets (nothing heats people up like somebody making a 'wrong call' on a trade where they have skin in play).
But I got tired of his rants loooong ago. There are far better venues - this one, Naked Cap, Setser, etc.
One problem with Mish's comments section: Comments are launched into dinky little pop-up window which makes them unreable. If you try to load them into a separate tab in Firefox, you get the original post but not comments. As a result, I don't waste time with comments on Mish's site.
Jas, would you care to comment on MS's thoughts that we are printing money?
This is a very important distinction that is being thrown around all of media without any details or understanding of the mechanism.
Fed balance sheet has expanded significantly, it has borrowed from Treasury to purchase mortgage assets, it has swapped treasuries for illiquid and likely insolvent assets and most of the reserves that have been created sit at the FED and haven't entered the economy.
In addition, FED is paying interest on those reserves.
MS, I am a big fan of your posts and think you have been spot on but I don't see the actual printing of money or at least the bond market doesnt seem to see it or are worried about it.
I would appreciate both your thoughts.
Happy holidays
But I got tired of his rants loooong ago. There are far better venues - this one, Naked Cap, Setser, etc. dryfly | 12.30.08 - 4:08 pm | #
I like those, too. I didn't like the crowd at Mish's blog in contrast to SI which is why I basically never post there and finally spent much more time here.
Mish still thinks the Fed is not printing money simply because they don't come out and tell you.
Or this one by Mish.....
Putin nationalized Gazprom, swallowed up everything in the industry (stealing from the rightful owners at then favorable prices to the state), and now blames Wall Street.
Rightful Owners? Surely he jests? Right? Gazprom was stolen by the Oligarchs from its rightful owners, the Russian People, so if Putin stole it, he stole it from thieves....not the "rightful owners."
I don't read Mish, but that comment right there is all I need to read to know the guy's misguided.
I have news for you, Mish. The U.S. should nationalize its Oil companies, as well. There is no competition in that market any longer, so why let the farce of free market capitalism continue when it comes to oil....unless, of course, its to further enrich the Plutocrats at the expense of the Plebes?
Mish still thinks the Fed is not printing money simply because they don't come out and tell you.
Yet another thing he's been consistently wrong on....
Ciao
MS
MS | 12.30.08 - 4:03 pm |
This has always been my biggest problem with Mish's viewpoint:
He seems to believe that there is something fundamentally preventing the Fed/US govt from flooding the system with cash.
If there's the political will for it, we can have a million dollars in everybody's hands in no time. The panic this would cause over the value of the dollar would probably lead to hyperinflation overnight.
With a fiat currency there's no reason this can't happen. Maybe it won't, but it's certainly not a given.
I think this kind of lack of "creative thinking" caused him to overlook the emergence of the housing bubble (I recall him saying he was surprised by it in a podcast).
MS, I am a big fan of your posts and think you have been spot on but I don't see the actual printing of money or at least the bond market doesnt seem to see it or are worried about it. Ian from Austin | 12.30.08 - 4:10 pm | #
Coincidence is not causation - people can be going into bonds for totally different reasons than to 'chase yield'. Could just be a temporary parking lot where they plan their next move. If there are a lot of people in the latter category - it will be interesting when they decide to start bugging out.
Someone tell me he's not serious, that this is satire.
Sorry, he's serious. Still, it's a useful site for knowing what the nitwits (aka, academics-that-think-they-are-smarter-than-supply-and-demand) are thinking. The lengths they go to in denying that we have been Keynesians for 70 years running is downright comical.
"If there are a lot of people in the latter category - it will be interesting when they decide to start bugging out.
dryfly"
I will find it interesting only if LT yields increase. Otherwise, I will find it not interesting and quite boring that the gov't can't stop itself from complete market manipulation.
people can be going into bonds for totally different reasons than to 'chase yield'. Could just be a temporary parking lot where they plan their next move dryfly | 12.30.08 - 4:18 pm | #
Just one more reason why treasury yields are destined to go up, up, up!
I wouldn't mind if I had to register to comment on CR, but I would be very, very sad to see things change.
BTW, I do not use Ken's glorious invention, I prefer to read the comments warts and all. The ignorant babblings (jg, bearly, cliffo, etc.) that set me into a rage are the guilty part of the pleasure of the whole experience.
Well, the one constant in life is change. Here's hoping this one is for the better rather than worse.
UST Long Bonds are the new "Hotel California." People who think they a parking cash are in for a big surprise. All those animals in the Bob La Brea Tar Pits thought they were going swimming.
There is no competition is the market any longer? You might actually be the stupidest person in the world. Or a pathological liar.
If the environment for competition is ripe within the oil industry, I challenge you to apply to one of the many TARP covered banks for a loan and start your own oil company. Lord knows they have plenty of money to lend...so all you need is a winning business plan, right? Let's see how far you get, or how relevant you are? That industry has long passed the point of competition. It's a Trust, for all practical purposes, and the only remaining undecided is who gets the last drops. It's time to Nationalize these Plutocratic Cash Cows.
That would be my guess - yields up & prices down - but I would never have guessed yields would ever be this low & prices this high. Go figure. dryfly | 12.30.08 - 4:26 pm | #
As a previous poster suggested, must be market manipulation. Which scenario is scarier? A federal government that seriously thinks having its right hand buy debt its left hand issues is going to result in anything short of collapse - OR - the economic destruction that rising "risk free" returns could bring in this current climate?
MS, I am a big fan of your posts and think you have been spot on but I don't see the actual printing of money or at least the bond market doesnt seem to see it or are worried about it.
Ian from Austin | 12.30.08 - 4:10 pm |
With the fractional reserve system money can be "printed" and used to buy bonds, thus keeping the yields down (the Fed can effectively create money to buy treasury debt - in essence they can create an arbitrary amount of demand for treasuries limited only by their willingness to devalue the buck).
IMO you have to look more at a combination of the dollar's value and interest rates to see what the market thinks.
how is it that this group believes prices of the long bond were able to stage such a massive rally ?
through actual purchases otc?
Through the futures market?
Don't mind a new system but JS-Kit isn't really that good and resource hungry. Anonymous | 12.30.08 - 4:30 pm | #
oops... hit the P button too quick.
Meant to add 'yes' & agree but remind us all it is CR's sandbox and if Halo & current commenting practices bu readers aren't tolerable to him - then he isn't going to keep at it.
how is it that this group believes prices of the long bond were able to stage such a massive rally ?
through actual purchases otc?
Through the futures market?
NewBondBear | 12.30.08 - 4:33 pm |
The same way Japan did it - monetization. Even the threat of monetization is probably enough in the short-term to get the speculators and carry traders to pile in.
I argued endlessly that treasury yields were headed down based on one simple argument:
If Japan could do it, so could we - so long as the demand for dollars is there.
Ignorace is bliss, thanks for demonstrating the truth of the truism...
Banks don't lend on exploration risk, they don't understand it and don't lend on it even in the best of times. There is current lending for development, based on existing proved reserves and volume/price haircuts to provide adequate coverage ratios.
The current price environment will indeed provide entry opportunities, however it will not be with bank lending. Rather, people will raise venture capital or roll their own nut into the game, acquire an exploit the resource and often sell their company to a larger competitor if they reach a critical mass of aggregation in an area of strategic interest...then do it all over again.
My poor heart. Ticker reporting the Fed will use Blackrock, Goldman, etc. to manage the passive buying and holding of MBS starting next month. The firms have to promise firewalls twixt these new desks and the trading desks. Yeah right.
...so all you need is a winning business plan, right? Let's see how far you get, or how relevant you are? That industry has long passed the point of competition. It's a Trust, for all practical purposes, and the only remaining undecided is who gets the last drops. It's time to Nationalize these Plutocratic Cash Cows. Morocco Bama | 12.30.08 - 4:32 pm | #
Hrm, let's see.... an Oligopoly wherein different players strive to extract the maximum value out of their commodities through price, but wherein the amount of value any one player can extract is by the willingness and desire of the competition to extract a little more (don't give me elasticity arguments, share matters) through lower prices. OR, a state monopoly in which one player gets to extract as much value from the commodity as it pleases?
Lesse... I'll take option 1. At least in that scenario, we can try to seek recourse through the courts in any proven case of collusion. Recourse in option 2 requires guns and bloodshed, and I'm really a peace-loving guy.
Argument Mish is making is that credit is going to credit heaven ...
however, on the other hand...
Saturday, December 6, 2008
This time it's Austrian
Citizen Grant reports in his latest missive that the Annualized Rate of Growth (over the last 3 months) of rentenmarks (Federal Reserve Bank Credit) is 2596.3%.
Wednesday, November 19, 2008
Rentenmarks and mops
Citizen Grant reports in his Novemeber 14th missive that the Fed has expanded its rentenmarks (Federal Reserve Bank credit) at an annual rate of 1,560.5%.
In related news, the Guinness Book of World Records is trying to determine the largest mop ever made.
and I don't see that it's any more searchable than halo (which is my biggest complaint). Comrade JoeBlo | 12.30.08 - 3:48 pm | #
I agree. JS-Kit promises searching, but it's really just filtering for the current thread. My next task had been to build a searchable index of the comments, but that has to move to the back burner if I'm going to do this port. If the format looks similar (i.e. no threading or paging), it might not be too much work (hint, hint).
I think CR and its Commentariat have a symbiotic relationship but they are clearly not the same organism.
I think that this is probably going to be what kills the goose that laid the golden egg, but that it's still unavoidable. One good channer raid and we'd be toast for weeks or months.
I hope that you focus very intently on getting the right technology, CR. The gabbling charlatans and mountebanks in your living room are not necessary to you, but it is a wonder of the world in a jewelbox you hold in your hand.
You may miss it more than you expect if you are careless with it. I hope that you will use your utmost forethought in considering these issues.
Argument Mish is making is that credit is going to credit heaven ...
however, on the other hand...
Saturday, December 6, 2008
This time it's Austrian
Citizen Grant reports in his latest missive that the Annualized Rate of Growth (over the last 3 months) of rentenmarks (Federal Reserve Bank Credit) is 2596.3%.
Well, that's just paper credit, not necessarily the real thing.
It remains to be seen whether these actions generate real credit (the lending of resources in the real world).
The Fed is fundamentally working with illusions. The question is whether or not people believe in them.
Gary writes:
BTW, what was the news in the last 30 minutes today?
Or is it just year end gremlins?
Gary | 12.30.08 - 4:43 pm | #
Yeh, I got yer benchmark right here
By Jason Zweig
Wall Street Journal
Sunday December 21, 2008
Painting the tape is a one-day wonder. Historically, 80% of all U.S. stock funds and 91% of small-company funds have beaten the market on the last trading day of the year - and roughly two-thirds have given most of that gain right back on the first day of the following year.
roadkill writes:
new FED program -- $500b funded with resereves - purpose to buy MBS -- Blackrock, Pimco and Goldman will manage the deal
roadkill | 12.30.08 - 4:47 pm | #
When I was a kid you could wander around Montzeumas Castle, a semi Canyon de Chelly place in AZ. It was not much fun going inside tho. Over the years people had urinated and what have you inside the rooms.
About the same time I had a secret hiding place in a cleft up in a semi-sandstone canyon. My handholds had been carved in the rock by some long ago Indian. It was right near a sacred area that BLM had driven heavy equipment through. Also dynamited a good part of it.
The taxpayers are funding the buying of crappy cars for people who won't own the car in 2 years because it will have been repoed. They, our leaders, do not have a clue. That is been obvious for awhile. The only thing positive that can be said is that ... Well, someone will think of something.
Anyone else here find it really sad (as a Mac user or not) that the market has so much confidence in Apple's business model that it tanks the company's stock everytime Jobs gets a head cold?
I always thought a business was supposed to trascend any one man.
On the pope, I have to pass, never read any of his writings. Hope you can enlighten me if I missed anything.
...St. Thomas Aquinas and Dante...
I am not sure how to phrase it. If I were flippy, I would say : Are these the Greats who thought the earth was flat? And if you reached the edge of it, you'd fall off into the depths of the universe?
I think to do them justice you need to see/interpret them within the context and limitations of their time.
The old Germans probably also had their (then valid) reasons to believe that lightning and thunder was caused by "Wotan" and "Donar" (German deities) swinging their hammer and driving about in chariots.
Well, today you can not even persuade a schoolchild of that.
Face it, St. Thomas Aquinas and Dante did not even have the use of a telescope. Or a notion of gallaxies (plural here!). It's not even 90 years since Edwin Hubble recognized that some of these "smudgy stars/nebulas were actually galaxies.
So, why would one base/limit the discussion of something that fundamental to the confines of the restricted knowledge of people who thought the earth was flat., etc. ?
The question is whether or not the reserves will go through the fractional reserve system sausage grinder where it starts chasin' goodies (inflation) or to credit heaven.
Rob Dawg writes:
Well, that's just paper credit, not necessarily the real thing...
Is this like that rollover minutes vs. new minutes joke? Isn't all credit paper credit?
Rob Dawg | Homepage | 12.30.08 - 4:52 pm | #
Anyone else here find it really sad (as a Mac user or not) that the market has so much confidence in Apple's business model that it tanks the company's stock everytime Jobs gets a head cold?- RockyR
Try drinking a Pepsi on the way to the Home Depot to spend some of your Countrywide HELOC and get back to us.
Without Jobs the fear is that Apple becomes Sun Microsystems in slow motion decline.
The world is getting ready to move on. Yet, as Dryfly has said, it will be more of the same. Somehow I don't get the warm fuzzy over that.
I have absolutely nothing to base this on, other than chemical imbalance perhaps, but we are very close to the point were history marks time as a before or after the event.
See, that's where we disagree. It's not their's, any more than the air is their's, or the water, or DNA. It's become such a fabric of life that no Corporation should be able to lay claim to it and sell it on an open, speculative market.
Is this like that rollover minutes vs. new minutes joke? Isn't all credit paper credit?
Rob Dawg
I would argue that real credit is something like lending your tractor to your neighbor for a week in exchange for a chicken.
This allows much more efficient use of resources and permits the type of economy that we have today.
Of course if you neighbor skips town, you never get your tractor back and are unlikely to engage in such a transaction in the future.
IMO this is real credit/debt.
Now we have pieces of paper that supposedly represent real wealth, but that doesn't mean they do.
If the Fed creates more lending of money (paper credit) without generating more real credit transactions (like described above) then they're accomplishing nothing except the destruction of the dollar (as more and more dollar based credit ends up being fictional).
Mortgage backed securities JOY!!!!!!
The rally is on!
Press Release
Federal Reserve Press Release
Release Date: December 30, 2008
For immediate release
The Federal Reserve on Tuesday announced that it expects to begin operations in early January under the previously announced program to purchase mortgage-backed securities (MBS) and that it has selected private investment managers to act as its agents in implementing the program.
Under the MBS purchase program, the Federal Reserve will purchase MBS backed by Fannie Mae, Freddie Mac, and Ginnie Mae; the program is being established to support the mortgage and housing markets and to foster improved conditions in financial markets more generally.
Further information regarding the structure and operation of the MBS purchase program is provided in the attached set of Frequently Asked Questions (FAQs).
What is the policy objective of the Federal Reserves program to purchase agency mortgage-backed securities?
The goal of the program is to provide support to mortgage and housing markets and to foster improved conditions in financial markets more generally.
Why is it necessary for the Federal Reserve to transact in the agency MBS market via external investment managers?
The operational and financial characteristics of MBS purchases are significantly more complicated than those associated with the assets that have traditionally been purchased by the Federal Reserve. The Federal Reserve has chosen external investment managers as a means of implementing the MBS program quickly and efficiently while at the same time minimizing operational and financial risks.
Because of the size and complexity of the agency MBS program, a competitive request for proposal (RFP) process was employed to select four investment managers and a custodian. The investment managers are BlackRock Inc., Goldman Sachs Asset Management, PIMCO and Wellington Management Company, LLP. The selection criteria were based on the institutions operational capacity, size, overall experience in the MBS market and a competitive fee structure. The contract for a custodian is not yet final.
What securities are eligible for purchase under the program?
Only fixed-rate agency MBS securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae are eligible assets for the program. The program includes, but is not limited to, 30-year, 20-year and 15-year securities of these issuers. The program does not include CMOs, REMICs, Trust IOs/Trust POs and other mortgage derivatives or cash equivalents. Eligible assets may be purchased or sold in specified pools, in to be announced (TBA) transactions, and in the dollar roll market.
What is the investment strategy that will be employed?
Investment managers will employ a passive buy and hold investment strategy in accordance with investment guidelines prescribed by the Federal Reserve. Purchases will be guided by commonly referenced market indices. The agency MBS program will involve the outright purchase of up to $500 billion in agency MBS by the investment managers on behalf of the Federal Reserve by the end of the second quarter of 2009. The New York Fed will adjust the pace of its purchases based on input from the investment managers about market conditions and the impact of the program. The investment managers will be required to purchase securities frequently and to disclose the Federal Reserve as principal.
The investment strategy may involve the use of dollar rolls as a supplemental tool to smooth market supply and demand. A dollar roll is a transaction involving the sale of agency MBS for delivery in the current month and the simultaneous agreement to repurchase substantially similar (although not the same) securities on a specified future date.
Does the agency MBS program expose the Federal Reserve to increased risk of losses?
Assets purchased under this program are fully guaranteed as to principal and interest by Fannie Mae, Freddie Mac, and Ginnie Mae, so the Federal Reserve's exposure to the credit risk of the underlying mortgages is minimal. The market valuation of agency MBS can fluctuate over time based on the interest rate environment; however, the Federal Reserve's exposure to interest rate risk is mitigated by the conservative, buy and hold investment strategy of the agency MBS purchase program.
When will the purchases begin?
Purchases are expected to begin in early January, 2009.
Who will the investment managers trade with and who is eligible to sell agency MBS to the Federal Reserve under the program?
Initially, the investment managers will trade only with primary dealers who are eligible to transact directly with the Federal Reserve Bank of New York. Primary dealers are encouraged to submit offers for themselves and for their customers.
Will the agency MBS held by the Federal Reserve through this program be eligible for lending through the Treasury Securities Lending Facility (TSLF) or the daily System Open Market Account (SOMA) securities lending operations conducted by the New York Fed?
There are no plans for the agency MBS held by the SOMA to be available for borrowing through the TSLF or the daily securities lending program.
How will purchases under the agency MBS program be financed?
Purchases will be financed through the creation of additional bank reserves.
What is the legal basis for the agency MBS purchase program?
Purchases of agency MBS in the open market, under the direction of the FOMC, are permitted under section 14(b) of the Federal Reserve Act.
How is the Federal Reserves agency MBS purchase program related to the U.S. Treasurys efforts to purchase agency MBS?
The Federal Reserves agency MBS program is separate and distinct from the U.S. Treasurys program but both programs are aimed at fostering improved conditions in mortgage markets.
How will holdings under the agency MBS program be reported?
Balance sheet items related to the agency MBS purchase program will be reported after settlement occurs on the H.4.1. statistical release titled Factors Affecting Reserve Balances of Depository Institutions and Condition Statement of Federal Reserve Banks. There will be an explanatory cover note on the release when the new items appear for the first time. However, these data may be published well after trade execution due to agency MBS settlement conventions. In addition, the New York Fed will publish the SOMA agency MBS activity in more detail on its external website on a weekly basis.
What measures will the Federal Reserve take to ensure that an investment manager implementing the MBS program will not have an unfair advantage relative to other market participants due to the information it receives about the MBS program?
Each investment manager will be required to implement ethical walls that appropriately segregate the investment management team that implements the Federal Reserves agency MBS program from other advisory and proprietary trading activities of the firm. The New York Fed will monitor each investment managers compliance with this requirement.
Anyone else here find it really sad (as a Mac user or not) that the market has so much confidence in Apple's business model that it tanks the company's stock everytime Jobs gets a head cold?
I always thought a business was supposed to trascend any one man.
RockyR
Well people remember how Apple went to hell in the 90s after Jobs was gone. Its revival seemed to occur with his return.
I remember doing work on products related to Apple around 1996 and we really had the feeling we were working on a dying platform.
The Fed said it "has selected private investment managers to act as its agents in implementing the program," which is "separate and distinct from the U.S. Treasury's program." The purchases will be financed through the creation of additional bank reserves, the Fed said.
So this is what we just talked about - devaluing the dollar to drive down interest rates.
Well people remember how Apple went to hell in the 90s after Jobs was gone. Its revival seemed to occur with his return.
I remember doing work on products related to Apple around 1996 and we really had the feeling we were working on a dying platform. ac | 12.30.08 - 5:03 pm | #
I'm an Apple convert who was staunchly PC in 1996. I love their products now but then again, I loved Sun Workstations too. I guess I'll stick to buying their products and not their stock.
"I am not sure how to phrase it. If I were flippy, I would say : Are these the Greats who thought the earth was flat? And if you reached the edge of it, you'd fall off into the depths of the universe?"
Do you think physics for the rest of time will be only a gloss on the physics of 2008? And do we value Dante for his exposition of physical science, and Augustine for his textbook on physical chemistry? Really, Werner, I'm surprised at you.
Do you discount Shakespeare for not having a doctorate in chemical engineering?
Augustine, educated in good classical Hellenistic schools, no doubt thought of the Earth as a sphere - Dante as well, probably.
These comments are probably why I'm going to be rejected this forum as incorrigibly off-topic.
roadkill writes:
new FED program -- $500b funded with resereves - purpose to buy MBS -- Blackrock, Pimco and Goldman will manage the deal
roadkill | 12.30.08 - 4:47 pm |
I know he's offline this week, but if you listen really really quietly, I think you can actually hear Eric weeping for his puts.
The purchases will be financed through the creation of additional bank reserves, the Fed said. ac | 12.30.08 - 5:05 pm | # 30yr fixed headed to 4.00% Lyon | Homepage | 12.30.08 - 5:07 pm | #
Q? Is it possible to have high inflation with low interest rates? My memory from schoold would say: "no".
I played around with the original iPod before it was released. I thought it was spiff but overpriced ($400) and no one would buy it. I was worng. It came out just as the Decade of Conspicuous Consumption began, and your $100 Abercrombe and Fitch T-shirt didn't look cool enough without an overpriced gadget swinging from it.
If Apple had remained a computer company (no longer Apple Computer, Inc.), it would have failed. The iProducts have kept it alive.
I'm an Apple convert who was staunchly PC in 1996. I love their products now but then again, I loved Sun Workstations too. I guess I'll stick to buying their products and not their stock.
RockyR | 12.30.08 - 5:06 pm |
I don't have an Apple, but I'd consider buying a Mac OS system now because it's Unix based (though I'll keep my Windows systems).
Dear SC/CR, Can you please maintain two separate threads: - one for comments related to your current post - and another one for comments, well, not related to your current post (like Israel and Palestine, Christians and Muslims, Stalin and Hitler) MrM | 12.30.08 - 3:53 pm | #
I second this idea. I really like the open threads because there are times when I am just not very interested in the relationship between NY real estate prices and divorce, or let's say, I'm not interested in COMMENTING on it or reading other's comments on it. How about a new open thread when the old one reaches 200 comments, for example? It could probably be done automatically somehow, I bet Mr. Ken Cooper could assist here.
Ok, Pavel, here it comes : And don't worry about being thrown out of CR. They will never throw you out!
At first, I presume that you will not find a telescope in any way misterious. (If not, tell me.)
Astronomers have used telescopes over several decades to explore the universe. A conservative guess i found was that there are 200 billion galaxies each consisting of 200 billion stars. And our sun is just an ordinary average star. So, that gives 4x10^22 stars or suns in the universe. (I once heared an astronomer (PhD) using the number 10^25; it doesn't matter. And for reasons becomming apparent below, I prefere the more conservative figure.)
Now, a 4 followed by 22 zeros is a figure even profligate americans have not (yet) managed to spend.
But let's try to visualize that number :
Imagine a beach, where the sand grains are 1 mm apart (that would make them a tad larger than 1 mm, let's say 1.2 mm; I am too lazy to do the correct calculation). So 1 qubic meter (1 m^3) would then contain 10^9 sand grains. Imagine a beach 10 m deeep, 100 m wide (water to land) and 1 m long : it would cotain 10^12 grains; make it 1 km long, and you have 10^15 grains. A length of 40.000 km (earths circumference on the equator) then gives you 4x10^19 grains.
So, if you wind a beach 10 m deep, 100 m wide 1000 times around the earth on the equator, it would have the same number of 1 mm apart grains as the universe has stars or suns respectively.
As you probably suspect, the story continues : Take one grain of that beach (call it sun) and imagine it has eight little specs of dirt attached (planets) and on one of these specs (earth) are 6+ billion bacteria (people). And one of these bacteria telling his friendly neighbor bacteria : "Last night, I folded my (bacteria-) hands and joined in dialog with the Maker of that whole beach."
But that is exactly what the Roman Catholic Church tells us : "If you fold your hands and pray, you enter into a dialog with God" (the creator of the universe) ! Or : "If three of you are congregated in my name, I will be amongst you."
Now, what would you say ? Plausible ?
If memory serves another half a trillion and we match the balance sheet percentage increase that the Japanese accomplished with their QE but in less than 1/4 the time...
I don't have an Apple, but I'd consider buying a Mac OS system now because it's Unix based (though I'll keep my Windows systems).
Something about it makes me feel warm and fuzzy.
The warm and fuzzy feeling I have about by iMac running OS X emanates mostly from my near inability to crash it. I restart about once every two months (when there's a software upgrade to be installed -- just put it to sleep the rest of the time) and it's stable as a rock. Contrast with my HP laptop from work running XP which is pretty much guaranteed to freak out if it isn't rebooted at least once a day. And XP is the "good" Microslop OS.
"Fortunately, libertarian blogger Chris Brunner has decided to put together an independent list of troubled banks. It is based on the "Texas Ratio" developed by Gerard Cassidy, measuring non-performing assets against less government guaranteed loans. "Basically, the higher the ratio, the worse the situation is for that particular bank," Brunner explains. "Banks with a ratio of 100 and higher are in very serious danger of collapse, and banks with a ratio of 50 or higher are vulnerable.""
Because the Fed can create money and use it to intervene in FX markets, right?
MrM | 12.30.08 - 5:11 pm |
No, because they can influence interest rates or the value of the dollar, but not both (as I see it). They can raise rates to increase the value of the dollar, and lower rates by devaluing the dollar.
So if they're artificially suppressing interest rates by creating dollars, you'd have to look at the market for dollars to get more of a sense for what real interest rates are based on the market.
If the 10-year yield is at 2%, but the dollar supply is expanding at a 10% rate, then you're realistically looking at a very negative real rate.
BTW if velocity is depressed this won't necessarily show up in the short-term as price inflation. But if the velocity returns...
BTW if velocity is depressed this won't necessarily show up in the short-term as price inflation. But if the velocity returns...
ac | 12.30.08 - 5:17 pm | #
So bailing one end of the bathtub will lower the water level if you just bail fast enough...
ac, that is exactly the reason I made the switch. A nicely packaged LINUX implementation that comes with slick hardware to boot!
RockyR | 12.30.08 - 5:17 pm |
I said that too, but somebody corrected me and said it's a BSD implementation, not Linux.
No, because they can influence interest rates or the value of the dollar, but not both (as I see it). They can raise rates to increase the value of the dollar, and lower rates by devaluing the dollar.
Also note that this is only possible because of the fiat system. With a gold-backed system the value of the dollar is fixed.
ac - I meant that the Fed could use the fiat money it created (say by selling bonds) to buy USD and maintain the FX rates, but at the expense of rising yields/interest rates. We are saying the same thing.
So the Fed is now going to buy MBS's with newly created funds? Does anyone know if this applies only to existing loans or can it also be done with NEW mortgages? Is this going to put a floor on the housing decline? Is this a harbinger of massive dollar devaluation?
As a guy who wants to buy a house, this is making wonder if it is about time to jump off the sidelines. On the other hand, I was pretty sure we are looking at big price declines this year in Socal. What do you think?
"Last night, I folded my (bacteria-) hands and joined in dialog with the Maker of that whole beach."
To which the other bacteria replies: "No. The whole beach and everything in it just spontaneously appeared. Matter form nothing and order from chaos. Happens all the time."
stretch002 writes:
So the Fed is now going to buy MBS's with newly created funds? Does anyone know if this applies only to existing loans or can it also be done with NEW mortgages? Is this going to put a floor on the housing decline?
It applies to all loans.....refinance boom extraordinaire!
I think this kind of lack of "creative thinking" caused him to overlook the emergence of the housing bubble (I recall him saying he was surprised by it in a podcast). ac | 12.30.08 - 4:18 pm | #
ac,
He was quite aware of the housing bubble. He simply expected it to pop much earlier.
As a guy who wants to buy a house, this is making wonder if it is about time to jump off the sidelines. On the other hand, I was pretty sure we are looking at big price declines this year in Socal. What do you think?
If you want the house to live in rather than as an investment, and you pay no more than 3x income for it, you don't need to solicit anyone's advice.
ac - I meant that the Fed could use the fiat money it created (say by selling bonds) to buy USD and maintain the FX rates, but at the expense of rising yields/interest rates. We are saying the same thing.
MrM
Well I don't think they would be creating dollars to buy dollars. What they could do is create dollars to buy other currencies, but that drives the value of the dollar down.
The FX rates are based on other currencies, which the Fed does not control.
So they can't print dollars to somehow buy more dollars and drive up the price, if that's what you're getting at.
The FX rates are based on other currencies, which the Fed does not control.
BTW this is why I say it's useful to look at the FX markets to determine real interest rates - precisely because the US Fed doesn't control them. Of course if other central banks are all doing the same thing you have to take that into account.
The 3x income is a nice way to gauge if I can afford to buy the house.
I am asking whether the Fed MBS purchases change my strategy of waiting another year for further declines. Do you think this will artificially slow down or halt the price declines over the course of the next year?
Note: I am buying a house at under 3x annual income. I just would like to pay as little for it as possible here in bubbly SoCal.
The normal YSP for a deal is 1.00% for an A credit deal. - Lyon
I don't think you want to understand what I am saying because your livelihood depends on not hearing it. I know how the market used to work. What I am saying is that with these managed MBS products you aren't going to get 1.00% anymore. This is not 2006. You really think Bill Gross is gonna let you charge him 4 large for processing paperwork?
BTW this is why I say it's useful to look at the FX markets to determine real interest rates - precisely because the US Fed doesn't control them. Of course if other central banks are all doing the same thing you have to take that into account. ac | 12.30.08 - 5:32 pm | #
I think I have some learning to do here. I'm not sure I know how to look at FOREX market data and relate that to t-bill yields to arrive at some idea of the real rate of return on a treasury note.
You may miss it more than you expect if you are careless with it. I hope that you will use your utmost forethought in considering these issues. Comrade Byzantine_Ruins | Homepage | 12.30.08 - 4:43 pm | #
I think CR is aware of that. However, CR also needs to consider what goes out in his name. Comments are often considered reflective of the blogger. CR has a reputation to protect.
know how the market used to work. What I am saying is that with these managed MBS products you aren't going to get 1.00% anymore. This is not 2006. You really think Bill Gross is gonna let you charge him 4 large for processing paperwork?
Rob Dawg | Homepage | 12.30.08 - 5:41 pm
You must be smoking dope. I am getting 1.00% back at least on all my deals now...That's not going to change. Right now 4.875% is back 1.00%. Want me to send you some rate sheets?
The paradox that Bernanke is in danger of discovering (the hard way) is the paradox of a pilot who finds himself in a flat spin. As the ground approaches he wants to pull back on the stick but if he does so, the spin simply tightens as the wings are not producing lift - the angle of attack is too high, not too low. As such if he does what his brain screams at him to do instinctively, he dies.
Or the scuba diver who sucks on the reg and gets nothing. Your instinct is to hold your breath and kick for the surface. If you do it you die.
You must be smoking dope. I am getting 1.00% back at least on all my deals now...That's not going to change. Right now 4.875% is back 1.00%. Want me to send you some rate sheets? Lyon | Homepage | 12.30.08 - 5:46 pm | #
1%? 1% of what? The interest on the principal? The total loan?
Release Date: December 30, 2008
For immediate release
The Federal Reserve on Tuesday announced that it expects to begin operations in early January under the previously announced program to purchase mortgage-backed securities (MBS) and that it has selected private investment managers to act as its agents in implementing the program.
Ok, how do we play this one? Buy an ETF that has Fannie/Freddie?
Shedlock is not to be imitated in any way. He's a sham. He's cranky because he knows he's wrong.
We may have deflation but the end game with a fiat currency will be inflation. The only question is if it morphs into hyperinflation.
His political opinions are naive to the point of being childish.
He chooses data points that support his deflation position and ignores anything to the contrary. He once cited the fact that pork chops were on sale in his supermarket as evidence of deflation.
Last summer he was going on about peak oil, as if he has any idea about the validity of that concept.
His commenters, who were never a sparkling group to begin with, have devolved into newbies and not too bright folk who are so lacking in discernment that they think he's the latest thing. As someone above mentioned they do a lot of the "Gee Mish, you're wonderful" thing and apparently he laps it up.
You must be smoking dope. I am getting 1.00% back at least on all my deals now...That's not going to change. Right now 4.875% is back 1.00%. Want me to send you some rate sheets? RockyR | 12.30.08 - 5:51 pm | #
If it's 1% of the spread, you have to push A LOT of paper to make 7 figures... I'm still impressed.
We're even except I do know how the brokerage business works and you cannot accept that change is inevitable.
Rob Dawg | Homepage | 12.30.08 - 5:51 pm | #
Really? So they you believe that the Feds want to take away incentive in the wholesale arena by getting rid of YSP?
Guess what, the customer then has to pay out of pocket that point up front, whether it is to a bank with much higher fees, or me with way lower fees.
Is that really what you think they are trying to do?
ChefVisar writes:
RE (in case you missed it from last thread)
"Have a look at this link. Especially the yellow table."
Thanks for the link. Thayer Watson also has a very nice summary of B/C Methodology on his website, for anyone interested in that sort of thing.
As for the consumption problem -- its very clear that government stimulus of the economy through purchases is nearly inconsequential.
ChefVisar | 12.30.08 - 5:19 pm | #
New Commenting Form.....just another learning curve for the chronologically challenged. I've barely adapted to using this keyboard. The one on the Remington was kinda clunky, but it worked GREAT!
Seven figures is 1.00% of $100m or 200-300/yr. Back in the days brokers could earn their fee by working the sheets for the best deal and walking the buyer through the pitfalls. With one buyer calling the shots and all the competition crowded out it isn't much of a value added service to read from the morning fax sheet.
stretch002 writes:
Does anyone have a guess as to how the Fed buying MBS's will affect housing prices? How it will affect mortgage rates?
stretch002 | 12.30.08 - 6:02 pm | #
Housing prices will stabilize and rates are going way down.
So they you believe that the Feds want to take away incentive in the wholesale arena by getting rid of YSP?...
Is that really what you think they are trying to do?
Don't think so. - Lyon
You make an excellent point. With the massive undersupply of mortgage brokers in the business and the huge barriers to entry and the lack of lending expertise by designated aggregators the likes of Goldmans, Blackrock, and Pimco the highly trained and carefully vetted mortgage broker is a valuable commodity who needs to be incented with ever higher compensation levels.
ikes of Goldmans, Blackrock, and Pimco the highly trained and carefully vetted mortgage broker is a valuable commodity who needs to be incented with ever higher compensation levels.
Rob Dawg | Homepage | 12.30.08 - 6:06 pm
By "seeing the housing bubble" I really mean realizing in late 2002, early 2003 that this thing was going to keep going for years to come. ac | 12.30.08 - 5:36 pm | #
In that case I agree that he didn't see it. Mish became a bear after having been burnt badly as a dot-com bull.
Well, this YSP holy war is certainly less annoying than other holy wars that have recently polluted this cyberspace. I'd have put my money on a Mac-PC smackdown filling the dead air. Interesting.
Housing market will not stabilize until the employment market stabilizes, wishful thinking of the Fed or Lyon aside...after the glow from the immediate pop, what will continue to be in desperately short supply will be creditworthy borrowers.
Check back with the commentariat in a year's time with your earnings, Lyon. Spare us the angels dancing on the head of a pin and we'll spare you the bullsh!t calls.
No more comments from fresno dan - I tried signing up at the Mish site to comment, and no matter what I do, it won't let me comment. The only thing I can imagine is that I comment from home and from work, and it sees a conflict with my moniker.
Check back with the commentariat in a year's time with your earnings, Lyon. Spare us the angels dancing on the head of a pin and we'll spare you the bullsh!t calls.
citizen energyecon | Homepage | 12.30.08 - 6:09 pm
Envy is a sin......
You have absolutely no idea how much money is going to be made.
You make an excellent point. With the massive undersupply of mortgage brokers in the business and the huge barriers to entry and the lack of lending expertise by designated aggregators the likes of Goldmans, Blackrock, and Pimco the highly trained and carefully vetted mortgage broker is a valuable commodity who needs to be incented with ever higher compensation levels. Rob Dawg | Homepage | 12.30.08 - 6:06 pm | #
Rob, you say this as if we live in a world that makes sense... as if we live among the rational. I'll bet Lyon cleans up.
Stories like these just make me regret the engineering degree and technical career that much more. Makes me feel like a chump.
Something about real estate and mortgage brokering attracts some of the biggest self aggrandizing blowhards out there. Crowing in an anonymous forum about how much money you are making, or will make, is beneath obnoxious.
I am skeptical that the Fed will be able to hold mortgage rates down for long. The rates are held down by purchases, not holding, of MBSs.
I wonder, however, if there might be a substantial short term opportunity here.
How do I become highly trained and carefully vetted? Does anyone have an address to which I could submit my application? - j marston
You might want to look at this story from January: Exurban Nation: Put Down Your Coffee First
Ken Cooper, I would REALLY be sad to give up the CR companion! It works incredibly well. It is a great asset to the site. I hope you can perform your magic again on any new programs!
You have absolutely no idea how much money is going to be made.
Lyon | Homepage | 12.30.08 - 6:13 pm | #
Neither do you - so spare us all your pronouncements in advance - and post your earnings at the end of the year, with a recipe for crow. Someone will eat hearty, and we will know for certain next year.
But bank this - this MBS purchase program will not stabilize house prices - when the price decline express got rolling before the job losses ramp-up got rolling...
"So, if you wind a beach 10 m deep, 100 m wide 1000 times around the earth on the equator, it would have the same number of 1 mm apart grains as the universe has stars or suns respectively.
As you probably suspect, the story continues : Take one grain of that beach (call it sun) and imagine it has eight little specs of dirt attached (planets) and on one of these specs (earth) are 6+ billion bacteria (people). And one of these bacteria telling his friendly neighbor bacteria : "Last night, I folded my (bacteria-) hands and joined in dialog with the Maker of that whole beach."
But that is exactly what the Roman Catholic Church tells us : "If you fold your hands and pray, you enter into a dialog with God" (the creator of the universe) !"
Gosh, Werner, you'd have to be God to be able to create and control a set-up like that.
What you're telling me is that if Werner can't get a grip on that kind of complexity, nobody could, not even God. This is solipsistic thinking with a frosting of question-begging on top.
Excuse me, but why do you take all believers for fools?
Why stop at grains of sand? Why not take into account all the photons in the universe? Now compare with the number of states possible in the human brain.
Accepting for a moment that there is a Creator, what does that make us in comparison? Most certainly, at least, dependents. Eh?
There's a lot more to be said, but better than saying is experiencing. A bacterium that can experience the glory of it.
Don't you ever experience the glory of the world, the mystery of it, the astonishment of it? I'm sure you must.
So even though mortgage rates will be offered at record lows, the bad jobs outlook will prevent the housing market from stabilizing? Do you think this will slow down the declines at all?
I'd been planning to wait another year to buy, but am wondering if I should. Seems if I can negotiate a good discount and lock in a record low mortgage rate it would not be all bad.
[I am skeptical that the Fed will be able to hold mortgage rates down for long. The rates are held down by purchases, not holding, of MBSs.
I wonder, however, if there might be a substantial short term opportunity here.
Original Eric]
I thought about this a bit. My sense is existing MBS get a bid since their yields, such as they are, will be more attractive. But as those who are still actually paying refi out all that will be left in the pool will make for an intense toxic mess.
stretch002 writes:
So even though mortgage rates will be offered at record lows, the bad jobs outlook will prevent the housing market from stabilizing? Do you think this will slow down the declines at all?
I'd been planning to wait another year to buy, but am wondering if I should. Seems if I can negotiate a good discount and lock in a record low mortgage rate it would not be all bad.
Buy or wait...pay cash or finance...
stretch002 | 12.30.08 - 6:27 pm | #
Another 18 months or so for me, but then I am 7 months into a two year lease...my WAG is this may make a small hiccup in the house price depreciation tango, but the employment picture will trump - refi's may pop but that will quickly run its course and how does that improve home sales?
Fed Selects Four Firms to Manage MBS Purchase Plan (Update1)
Email | Print | A A A
By Craig Torres
Dec. 30 (Bloomberg) -- The Federal Reserve chose BlackRock Inc., Goldman Sachs Asset Management, Pacific Investment Management Co. and Wellington Management Co. to manage a $500 billion purchase of mortgage-backed securities it plans to complete by June.
Only fixed-rate agency mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae will be eligible for purchase, the central bank said in a statement released in Washington today. The Fed said the purchases, to start early in January, will include securities with maturities of 30, 20, and 15 years, and will exclude riskier securities such as interest-only bonds.
The other thought I had was does this make a mark for MBS assets that will help support bank balance sheets - buy and hold will create 'market' price transactions - or will that affect the volume of paper that is held out there already?
Rob Dawg - couldn't post from work today, but that IP thief who posted the Dawg's Misean Institute curriculum to Jim Sinclair's site with no hat tip changed it in a couple of ways: scrubbed a ref in the Gitmo line and swapped Setser for Perkins in the endocolonialism line.
Skroos the satire in both cases. Guess he didn't get it.
With the new posting system, is there any way we can ensure we get our own current handles again?
This is a desperate attempt to get bank lending again right? If all banks know they can sell the MBS to Fannie/Freddie then they will start to make loans again and pocket the fees?
if there were not a chance for me to snarf cold beer out my nose at least once an evening, I may not read the comments as often.....Ill be stuck going through day old dealbook just to get a giggle...
1st
oooooooooooooooooooooooooooooo
Does it screen out idiotic misinterpretations of Keynes?
That'd be a cool algorithm.
Can we still say 'first' on the new commenting system?
ugh it's actually quite ugly and jumbled looking. Halo might be anarchic but at least it is clean looking.
Oh well, the trolls must be caged I suppose.
Ruh-roh Shaggy...well, time to scamper quick to claim those handles...
I guess it's good I only got around to putting Ken's CR Companion on one 'puter.
JS-Kit does not scale well. This comment from Mish's tells the tale:
mish, I analyzed your page using yslow (its a firefox plugin) and it seems like you have very heavy javascript usage as compared to calculated risk. see first image for stats on your blog. javascript files are 267k even when cached. In addition the site makes 57 http request compared to 50 by calc risk. Finally calc risk does a bitter job of caching images, this may have to do with expiration headers etc on the page. The second graphic is stats from calc risk page.
In terms of javascript file size, a significant number of this is coming from js-kit.
regards
"This should help with improving the quality of the comments."
LOL. A euphemism for "this should keep the snarky whiny repetitive trolls from stinking up the joint".
CR, if you go to JS Kit, can we skip the avatars? It's the only thing I really dislike over at mish's new comments section, which are otherwise very good.
I'm loving it that the market can take good news and go up. And it can take bad news and ignore it and move up. At this rate I'll be a millionaire while every company in the S&P is BK and all jobs reside in India.
I cannot open Mish's comments. Guess I'll give up posting my pizza news now.
I guess this is goodbye to the CR companion, for now at least. Too bad. I am quite fond of it.
I'd second killing avatars. I don't need to see pics of peoples cats thnx.
I don't understand. How could the comments be better than they already are?
I do like the avatars.
I already found one for Jas.
Oh well, the trolls must be caged I suppose.
Windowdog | 12.30.08 - 2:40 pm | #
Nothing defeats trolls except starvation.
This commenting system is much better. I wonder if CR can do it.
The Housing Bubble Blog » What Goes Around Comes Around In California
ECONOMY BOOST!
INDIANAPOLIS (AP) Stocking up on aspirin by Wednesday night will do more than blunt a New Years Day hangover for many people across the country. Purchases like that also help employees who hold health Flexible Spending Accounts whittle their balances before 2008 ends and, in many cases, they forfeit their money. \tBenefits experts say there are several last-minute ways to use leftover money in these accounts. FSAs give consumers possible tax savings by letting them use money from payroll deductions on certain health-related expenses. People with accounts that must be used by Dec. 31 have no time to schedule a medical procedure. Even squeezing in an eye exam may prove impossible, so its time to start thinking about the small items. Band-Aids, cough syrup, laxatives and even condoms are all eligible for flex spending dollars.
laxatives and even condoms are all eligible for flex spending dollars.
Try not to look the cashier in the face as you buy $500 worth of laxitives and condoms in one shot on New Year's Eve.
Dunno. I don't typically comment over at Mish's (he had horrific battles with some commenters for months, before he started banning the worst of them), so I don't know about JsKit much. I do like my CR Companion, I have to say ... and I'll miss it dearly. Barry bans 'First!' posts, but that's asthetic, not technical.
Not fond of the avatars - but I do wonder what Conjure Bag's would be.
If I had flex money left (and I don't), I'd stock up on uber-quantities of Ibuprofen and Tums.
I can't see the comments on Mish's site.
When I click on the "comments" link, it opens up the same page?
That nifty plugin ain't gonna work no more.
Does that mean I'll have to read Jaswant Jain's comments again? Oh, the humanity...
Shedlock has gotten cranky lately. His responses to dissenters are usually laden with ad hominem snark.
Fuuuuuuuuuuuuuuuuuuuck!!!
Hopefully next week I'll be moving to the new JS-Kit commenting system. This should help with improving the quality of the comments.
In my humble opinion, there is no technological fix for the problem except constant, manual vigilance by the administrator. Even some jawboning, like Bernanke, in the form of stern warnings and threats from the management, would go a long way. (Bears' Chat comments are by registration and they're still patrolled regularly.)
In any case, didn't you try JS-Kit once before, and then quickly went back to HaloScan?
OP-ED COLUMNIST; Add Up The Damage - NY Times
Add Up the Damage
And then theres the Bush economy, another disaster, a trapdoor through which middle-class Americans can plunge toward the bracing experiences normally reserved for the poor and the destitute.
Mr. Bush traveled the country in the early days of his presidency, promoting his tax cut plans as hugely beneficial to small-business people and families of modest means. This was more deceit. The tax cuts would go overwhelmingly to the very rich. The president would give the wealthy and the powerful virtually everything they wanted. He would throw sand into the regulatory apparatus and help foster the most extreme income disparities since the years leading up to the Great Depression. Once again he was lighting a fire. This time the flames would engulf the economy and, as with Iraq, bring catastrophe. If the U.S. were a product line, it would be seen now as deeply damaged goods, subject to recall. There seemed to be no end to Mr. Bushs talent for destruction. He tried to hand the piggy bank known as Social Security over to the marauders of the financial sector, but saner heads prevailed...
Cliffo: The reason to go back to JS-kit is that they now support OpenID... so posters can be more readily verified and banned. It will prevent the name stealing shenanigans.
I'll also miss CR Companion. It solves the troll problem for me.
FWIW, I'm OK with a regidtration system where only registered visitors can post or reply to comments. Is there really that much resistance to that?
When I click on the "comments" link, it opens up the same page?
Anonymous | 12.30.08 - 3:02 pm | #
Same for me and Gretchen is reportedly NOT pleased either!
I'm considering updating CR Companion to support the new format. CR was his usual gracious self, and gave me a heads up last week, but I can't be clear on the impact until it's up and running. I'll keep you posted.
JS Kit does allow anonymous posting. Maybe CR will set it up that way.
FFDIC writes:
I cannot open Mish's comments. Guess I'll give up posting my pizza news now.
FFDIC | 12.30.08 - 2:45 pm | #
NO!!!!!!!!!!!!!!!!!!!!!
FFDIC - speaking of pizza...Stockton, CA bank got a big smackdown yesterday
"Ken Cooper writes:
I'm considering updating CR Companion to support the new format."
There still is a fair and just god. I was beginning to wonder.
Central Valley Business Times
Mish's site is by far the slowest loading blog I visit - the blog not the comments. Takes like 25 seconds before the scroll key works compared with maybe 3-4 seconds for CR and the BP (modem working flatout the entire time). Perhaps that is the Java issue in an earlier comment. Before changing over it might serve to do some timing comparisons.
Jim
BTW, I'm impressed with the restraint everyone has here of not responding to trolls. Seen it lots of times where a troll will be left swinging in the wind while everyone else just ignores him.
Change is good except when it is bad and then it is bad.
Oh no not this again!
NO!!!!!!!!!!!!!!!!!!!!!
crispy&cole | Homepage | 12.30.08 - 3:11 pm | #
I'll be posting my pizza news on the blackboard at Cavalli's Pizza Parlor in Irving, TX near DFW airport.
Cavalli Pizza - Irving, TX
I'd like to request that the new format doesn't use the pagination. When you refresh Shedlock's site, you have to scroll up to the page numbers and click on the last page to get back to where you were. PIA.
y... registration is a no go. more fun without it. And i've donated! worth more than nytimes sub. paid more too. no reg!
Just promise us you won't have nested comments. That will ruin everything...
Shedlock has gotten cranky lately. His responses to dissenters are usually laden with ad hominem snark.
Speed | 12.30.08 - 3:05 pm | #
Lately? As in this century?
"Just promise us you won't have nested comments."
You guys know your comment systems. Nested?
"Just promise us you won't have nested comments."
You guys know your comment systems. Nested?
Elvis
The birds are a terrible distraction.
In any case, didn't you try JS-Kit once before, and then quickly went back to HaloScan?
El Cliffo | Homepage | 12.30.08 - 3:06 pm | #
I think they have merged - so it is now JSK = New Imroved Halo.
"Just promise us you won't have nested comments."
You guys know your comment systems. Nested?
Elvis
Nested just means that when you reply to a comment it appears beneath the original comment (usually indented). Like craigslist.
Ah, yes, the dreaded nesting system. It should be banished forever in the bowels of hell.
Pizza news. Get it while it's HOT!
FDIC issues tough order against Community Bank of San Joaquin
FDIC issues tough order against Community Bank of San Joaquin - Sacramento Business Journal:
Analyst Bove: U.S. banking sector's outlook better than believed
(I'm definitely not in the Bove camp.)
Analyst Bove: U.S. banking sector's outlook better than believed
| Quotes
| Company News
| Reuters
Former FDIC Chair, Now Advising Paulson, Is Looking To Profit From Bailout
(Has been too old to help anybody now.)
TPMMuckraker | Talking Points Memo | Former FDIC Chair, Now Advising Paulson, Is Looking To Profit From Bailout
Regulators cite Wyo bank
http://www.jacksonholestartrib.com/articles/2008/12/29/news/wyoming/7cddb98a2bded3988725752f0001ca09.txt
Banking landscape will change next year
Bottom line: Area banks are in worse shape than the rest of the country, says Sarasota banking consultant Tramm Hudson.
FDIC Fair Lending Examination Specialists will host a Fair Lending Conference Call for bankers on January 14, 2009. The call will feature a presentation on how bankers can perform an effective fair lending risk assessment and will include a question-and-answer session. The conference call is free and available to employees of all FDIC-supervised institutions.
FDIC: FDIC Teleconference on Conducting a Fair Lending Risk Assessment
Banking landscape will change next year | HeraldTribune.com | Sarasota Florida | Southwest Florida's Information Leader
Just promise us you won't have nested comments. That will ruin everything...
I second that.
I'll try almost anything once. I'm sure CR will listen to our input if it proves to be intolerable.
I'm all for any improvement, and making CR's burden easier. If Ken can combine the features of CR Companion with JS-Kit, it might be a four-bagger.
Nesting is an option, but if you post without it, the nesters don't like it.
I can only tolerate Mish in small doses. He quickly ignores or summarily dismisses data when it doesn't agree with his preCONceived conclusion of deflation.
I wish I could see the future as clearly as Mish. I'd no doubt be wealthy and famous.
'm considering updating CR Companion to support the new format. CR was his usual gracious self, and gave me a heads up last week, but I can't be clear on the impact until it's up and running. I'll keep you posted.
Ken Cooper | Homepage | 12.30.08 - 3:10 pm | #
Out-EFFING-standing!
Mish's site is by far the slowest loading blog I visit - the blog not the comments. Takes like 25 seconds before the scroll key works compared with maybe 3-4 seconds for CR and the BP (modem working flatout the entire time). Perhaps that is the Java issue in an earlier comment. Before changing over it might serve to do some timing comparisons.
NC Jim | 12.30.08 - 3:12 pm | #
Mish got adz galore...
CR,
for the good lord's sake, please please stick to Halo. Despite its disadvantages, it has a a neat and clean presentation.
I have stopped reading comments on Mish's site (despite loving his blog) after, particularly, the latest changes. It is butt-ugly (sorry Mish) and feels more like a teenager's forum!
So, please stick to a text only clean comments layout. I personally feel that the only drawback with your comments section is that, with the rising popularity if the blog, there way too many wasteful comments. But, that is the cost to be paid I guess. Barring that, please don't change a thing.
TIA
Mish got adz galore
but I got Adblock (heh).
CR, we for the most part are adults and trolls are who they are. Self policing is usually the best way of enforcement.
This is a great informative blog and chat site.
Please DO NOT CHANGE A THING.
If Ken can combine the features of CR Companion with JS-Kit, it might be a four-bagger.
Actually, it will be like turning Crossfire into the NewsHour with Jim Lehrer. And I don't think that's a good thing, at all. On the other hand, you may enjoy Calculated Snooze.
I wish I could see the future as clearly as Mish. I'd no doubt be wealthy and famous.
Angry Saver | 12.30.08 - 3:28 pm | #
LOL. Me too.
briwerk writes:
Cliffo: The reason to go back to JS-kit is that they now support OpenID... so posters can be more readily verified and banned. It will prevent the name stealing shenanigans.
Hopefully I'll see some posts by EHP again.
I've learned a lot here under the old comments rules or lack thereof.
1. Bongwater comes in flavors
2. Nighstand cowboy is not a dude
3. NorkaWest wears Victoria's Secret
4. Tanta was loved by millions
5. Fuck can be spelled 563 ways
6. Bush has 3.5 fans in Ohio
7. Condi Rice is not important at CR
8. Illegals buy McMansions w/pools
9. How to grow hops in my backyard
10. Gardening 101
11. CNBC sucks puppies
12. Life is hard in Vegas
13. Elvis lives
14. Heather Locklear is depressed
15. Paulson's pinkie/mind are twisted
16. China is pissed
17. Rotary clotheslines save energy
19. Hemp cup cakes keep you regular
20. Wood stoves are in fashio
Hopefully I'll see some posts by EHP again.
Jerry | 12.30.08 - 3:35 pm | #
Maybe even CSC - that would make for a nice buzz.
Nesting is an option, but if you post without it, the nesters don't like it.
I think nesting would alter the conversational nature of this blog. I post frequently on many sites with nested comments, and I don't have any fundamental problem with them, but I think they'd change the flow of dialog here in a substantial way. I say don't risk messing too much with a good thing.
@ FFDIC | 12.30.08 - 3:36 pm | #
Ummmm... forgetting something?
I guess this is goodbye to the CR companion, for now at least. Too bad. I am quite fond of it.
aClem | 12.30.08 - 2:49 pm | #
That is my biggest concern!
Ummmm... forgetting something?
dryfly | 12.30.08 - 3:41 pm | #
18. Squirrel dumplings is good eatin!
I think nesting would alter the conversational nature of this blog. I post frequently on many sites with nested comments, and I don't have any fundamental problem with them, but I think they'd change the flow of dialog here in a substantial way. I say don't risk messing too much with a good thing.
ac | 12.30.08 - 3:40 pm | #
Does JSK allow readers to nest-unnest?
dryfly | 12.30.08 - 3:41 pm | #
18. Squirrel dumplings is good eatin!
FFDIC | 12.30.08 - 3:42 pm | #
Thank you!!
Hey, you nutty Palestian/Isreali issue commentators, I'll be scoring you guys really high.
Thanks Ken. Having the CR Companion in the new commenting system would just be outstanding.
Time for the year end tape painting to commence! Weee!
Lately? As in this century?
dryfly | 12.30.08 - 3:18 pm | #
He has a temper but we have always gotten along. He has simply gotten too much on the ideology trail for my taste.
Ken-
Thanks for working on the companion and I hope you can support it even with the move.
I would be really sad to see it go... it lets me read CR even when I don't have time to look at the wittiest of comments.
Certainly the new format looks a bit more busy, and I don't see that it's any more searchable than halo (which is my biggest complaint).
I'm considering updating CR Companion to support the new format. CR was his usual gracious self, and gave me a heads up last week, but I can't be clear on the impact until it's up and running. I'll keep you posted.
Ken Cooper | Homepage | 12.30.08 - 3:10 pm | #
CR-
The best we can do is ignore the trolls. Like DRM, there is always a way around it. It's been more annoying recently, but readable (except perhaps for a couple of threads). I just hope that doesn't mean that you've been spending hours cleaning it up. Also love to see some of the older folks come back... even if it's just to get a taste of the new.
Does JSK allow readers to nest-unnest?
dryfly | 12.30.08 - 3:42 pm |
I have no clue, but I'd assume there would be an option to enable or disable nested comments.
Shedlock has gotten cranky lately. His responses to dissenters are usually laden with ad hominem snark.
Speed | 12.30.08 - 3:05 pm |
Maybe he's feeling a bit defensive after that Santa rally call.
Okay - he's gotten crankier lately. Also, the majority of the posts now begin with "Oh Mish - you're a genius!"
He has a temper but we have always gotten along. He has simply gotten too much on the ideology trail for my taste.
RE | 12.30.08 - 3:46 pm | #
For me that was in 2005 or so...
Does JSK allow readers to nest-unnest?
Yes'm
Dear SC/CR,
Can you please maintain two separate threads:
- one for comments related to your current post
- and another one for comments, well, not related to your current post (like Israel and Palestine, Christians and Muslims, Stalin and Hitler)
I promise I will read and post in both threads.
It will be all self-regulated and posters with good style (like CSC or Misean) will be welcome in both threads regardless of relevance of their comments. On the other hand, serial violators will be banished.
Thank you.
Does JSK allow readers to nest-unnest?
Yes'm
Speed | 12.30.08 - 3:51 pm | #
Then no problemo - if youse likes a nest nest if not unnest. Everybody happy?
Or can only CR switch on & off?
--
We have perfect models for marriages and living together arrangements. Mortgage homeownership and rental units, respectively. No-docs = no fault.
Jas
Bank of America and Mr. Higgins missing $millions, it can happen to you my, fellows Americans
More info at: 404 Not Found
Nesting is a user option, so each person can view with it on or off. Small problem: if you get used to viewing in nest mode, when people post at the bottom, it can be annoying.
Also, I don't think JS Kit has a "Click here to refresh" so there's no knowing when a new post is up - that's my experience anyway.
For me that was in 2005 or so...
dryfly | 12.30.08 - 3:51 pm | #
I was then still posting primarily on his board at SI. He was much more open then and there... We were also a team at themarkettraders. I like him as a person but don't always appreciate his not always flexible and forceful online persona. But I always had his respect and therefore we NEVER got into a fight despite having very obvious political differences.
BTW I am the guilty party as to why he is using JS-KIT.
Mish still thinks the Fed is not printing money simply because they don't come out and tell you.
Yet another thing he's been consistently wrong on....
Ciao
MS
Of all the annoying things that have been written during this crisis, surely this ranks at the top.
Economist's View: "How to Prevent the Great Depression of 2009"
Someone tell me he's not serious, that this is satire.
Can we debate the laws that were broken, on Wallstreet and AIG, yet our Tresuary bails out these Banksters as if nothing has happened.
This is like the wild wild west when the fastest gun ruled the town.
Where am I wrong here?
My new name will be "old bitch in highheels."
Peak CR. Whocouldanode? A blog's life, and relevance, can be assessed by its comments stream. CR has reached The Peak, hence the censorship. It's downhill from here. Oh well, another will rise to take its place. It's the natural way of blogs, if there is such a thing.
MS,
Are you currently in the market? If so, how are you positioned?
Everyone should contribute to a giant pot with matching contributions by the FED and that cash should be used to bail everybody out.
Problem solved.
CNNMoney.com: 404 Page Not Found
Banks cut lending by 55% in 2008
U.S. loan issuance fell to the lowest volume since 1994 as banks repair balance sheets, shun underwriting new, risky deals.
Does this mean I'm going to get banned?
...
BTW I am the guilty party as to why he is using JS-KIT.
RE | 12.30.08 - 3:59 pm | #
I see no problem w/ it - I'm flexible.
Also I have no doubt Mish is a decent guy in person and that the intertubez can really rub you raw. The latter is especially true for somebody like him who is both strongly opinionated AND calling shots on markets (nothing heats people up like somebody making a 'wrong call' on a trade where they have skin in play).
But I got tired of his rants loooong ago. There are far better venues - this one, Naked Cap, Setser, etc.
One problem with Mish's comments section: Comments are launched into dinky little pop-up window which makes them unreable. If you try to load them into a separate tab in Firefox, you get the original post but not comments. As a result, I don't waste time with comments on Mish's site.
Jas, would you care to comment on MS's thoughts that we are printing money?
This is a very important distinction that is being thrown around all of media without any details or understanding of the mechanism.
Fed balance sheet has expanded significantly, it has borrowed from Treasury to purchase mortgage assets, it has swapped treasuries for illiquid and likely insolvent assets and most of the reserves that have been created sit at the FED and haven't entered the economy.
In addition, FED is paying interest on those reserves.
MS, I am a big fan of your posts and think you have been spot on but I don't see the actual printing of money or at least the bond market doesnt seem to see it or are worried about it.
I would appreciate both your thoughts.
Happy holidays
NorkaWest :
Open another blank tab. And then 'drag and drop' the URL from the Comments window into that blank tab and there you have it.
My new name will be "old bitch in highheels."
AP'Shadow | 12.30.08 - 4:04 pm | #
Can't wait to see your avatar...
But I got tired of his rants loooong ago. There are far better venues - this one, Naked Cap, Setser, etc.
dryfly | 12.30.08 - 4:08 pm | #
I like those, too. I didn't like the crowd at Mish's blog in contrast to SI which is why I basically never post there and finally spent much more time here.
"Jas, would you care to comment".....
Ian from Austin | 12.30.08 - 4:10 pm | #
L.O.L.
Mish still thinks the Fed is not printing money simply because they don't come out and tell you.
Or this one by Mish.....
Putin nationalized Gazprom, swallowed up everything in the industry (stealing from the rightful owners at then favorable prices to the state), and now blames Wall Street.
Rightful Owners? Surely he jests? Right? Gazprom was stolen by the Oligarchs from its rightful owners, the Russian People, so if Putin stole it, he stole it from thieves....not the "rightful owners."
I don't read Mish, but that comment right there is all I need to read to know the guy's misguided.
I have news for you, Mish. The U.S. should nationalize its Oil companies, as well. There is no competition in that market any longer, so why let the farce of free market capitalism continue when it comes to oil....unless, of course, its to further enrich the Plutocrats at the expense of the Plebes?
Hell to the yes, they're printing money.
Whereas M2 averaged 5.5% growth for the last five years, for the 5 weeks up to the 12/26 data, it's growing at a 27% average annual rate.
So, no, it's not a deflation in any strict Austrian sense.
Long bond rates are low because the Fed is buying the long end to effect quantitative easing.
Bank of America and Mr. Higgins missing $millions, it can happen to you my, fellows Americans
More info at: 404 Not Found
"so posters can be more readily verified and banned."
And those are good things? To my mind, they are not.
Mish still thinks the Fed is not printing money simply because they don't come out and tell you.
Yet another thing he's been consistently wrong on....
Ciao
MS
MS | 12.30.08 - 4:03 pm |
This has always been my biggest problem with Mish's viewpoint:
He seems to believe that there is something fundamentally preventing the Fed/US govt from flooding the system with cash.
If there's the political will for it, we can have a million dollars in everybody's hands in no time. The panic this would cause over the value of the dollar would probably lead to hyperinflation overnight.
With a fiat currency there's no reason this can't happen. Maybe it won't, but it's certainly not a given.
I think this kind of lack of "creative thinking" caused him to overlook the emergence of the housing bubble (I recall him saying he was surprised by it in a podcast).
MS, I am a big fan of your posts and think you have been spot on but I don't see the actual printing of money or at least the bond market doesnt seem to see it or are worried about it.
Ian from Austin | 12.30.08 - 4:10 pm | #
Coincidence is not causation - people can be going into bonds for totally different reasons than to 'chase yield'. Could just be a temporary parking lot where they plan their next move. If there are a lot of people in the latter category - it will be interesting when they decide to start bugging out.
I don't read Mish, but that comment right there is all I need to read to know the guy's misguided.
Not misguided, just opinionated as are most commenters! Nothing wrong with that.
Not a fan of him though, he quashes dissent like an information czar!
Someone tell me he's not serious, that this is satire.
Sorry, he's serious. Still, it's a useful site for knowing what the nitwits (aka, academics-that-think-they-are-smarter-than-supply-and-demand) are thinking. The lengths they go to in denying that we have been Keynesians for 70 years running is downright comical.
Anonymous | 12.30.08 - 3:05 pm | #
Is that you CSC?
"so posters can be more readily verified and banned."
And those are good things? To my mind, they are not.
Austin Tex | 12.30.08 - 4:18 pm | #
It's just a bazooka - no need to ever take it out.
"If there are a lot of people in the latter category - it will be interesting when they decide to start bugging out.
dryfly"
I will find it interesting only if LT yields increase. Otherwise, I will find it not interesting and quite boring that the gov't can't stop itself from complete market manipulation.
My dog got loose and bit the governor who was walking down the street.
I now see on Fox News that the governor is appointing to the vacant dog catcher seat Benjamin Netanyahu.
I have news for you, Mish. The U.S. should nationalize its Oil companies, as well.
There is no competition is the market any longer? You might actually be the stupidest person in the world. Or a pathological liar.
people can be going into bonds for totally different reasons than to 'chase yield'. Could just be a temporary parking lot where they plan their next move
dryfly | 12.30.08 - 4:18 pm | #
Just one more reason why treasury yields are destined to go up, up, up!
Just one more reason why treasury yields are destined to go up, up, up!
RockyR | 12.30.08 - 4:23 pm | #
That would be my guess - yields up & prices down - but I would never have guessed yields would ever be this low & prices this high. Go figure.
What, people got tired of zimmy z?
Bonds are not "temporary park lots" Perhaps you mean tBills? Buying bonds at these prices is pure lunacy
I don't read Mish's site. never have.
I wouldn't mind if I had to register to comment on CR, but I would be very, very sad to see things change.
BTW, I do not use Ken's glorious invention, I prefer to read the comments warts and all. The ignorant babblings (jg, bearly, cliffo, etc.) that set me into a rage are the guilty part of the pleasure of the whole experience.
Well, the one constant in life is change. Here's hoping this one is for the better rather than worse.
Bonds are not "temporary park lots" Perhaps you mean tBills? Buying bonds at these prices is pure lunacy
lendingmaestro | 12.30.08 - 4:26 pm | #
I would agree - but if you think you are Mr Smarty Pants and can be the first out the door - why not?
Of course we all imagine ourselves the first out the door right? Lunatics R Us.
Gary I think you are an ignoramus as well but am with you on this point.
Don't mind a new system but JS-Kit isn't really that good and resource hungry.
Don't mind a new system but JS-Kit isn't really that good and resource hungry.
Anonymous | 12.30.08 - 4:30 pm | #
UST Long Bonds are the new "Hotel California." People who think they a parking cash are in for a big surprise. All those animals in the Bob La Brea Tar Pits thought they were going swimming.
After that press conference, I am so embarassed to be from Illinois. Time to put air in the tires of my house, and move it across the state line.
There is no competition is the market any longer? You might actually be the stupidest person in the world. Or a pathological liar.
If the environment for competition is ripe within the oil industry, I challenge you to apply to one of the many TARP covered banks for a loan and start your own oil company. Lord knows they have plenty of money to lend...so all you need is a winning business plan, right? Let's see how far you get, or how relevant you are? That industry has long passed the point of competition. It's a Trust, for all practical purposes, and the only remaining undecided is who gets the last drops. It's time to Nationalize these Plutocratic Cash Cows.
That would be my guess - yields up & prices down - but I would never have guessed yields would ever be this low & prices this high. Go figure.
dryfly | 12.30.08 - 4:26 pm | #
As a previous poster suggested, must be market manipulation. Which scenario is scarier? A federal government that seriously thinks having its right hand buy debt its left hand issues is going to result in anything short of collapse - OR - the economic destruction that rising "risk free" returns could bring in this current climate?
Not feeling bullish, today...
MS, I am a big fan of your posts and think you have been spot on but I don't see the actual printing of money or at least the bond market doesnt seem to see it or are worried about it.
Ian from Austin | 12.30.08 - 4:10 pm |
With the fractional reserve system money can be "printed" and used to buy bonds, thus keeping the yields down (the Fed can effectively create money to buy treasury debt - in essence they can create an arbitrary amount of demand for treasuries limited only by their willingness to devalue the buck).
IMO you have to look more at a combination of the dollar's value and interest rates to see what the market thinks.
how is it that this group believes prices of the long bond were able to stage such a massive rally ?
through actual purchases otc?
Through the futures market?
Oh, you can bet your azz they're going to play whack-a-mole with yields on the long end.
Don't mind a new system but JS-Kit isn't really that good and resource hungry.
Anonymous | 12.30.08 - 4:30 pm | #
oops... hit the P button too quick.
Meant to add 'yes' & agree but remind us all it is CR's sandbox and if Halo & current commenting practices bu readers aren't tolerable to him - then he isn't going to keep at it.
how is it that this group believes prices of the long bond were able to stage such a massive rally ?
Bill Gross willed it.
You guys realize financial futures started right about the time N closed the G window.
how is it that this group believes prices of the long bond were able to stage such a massive rally ?
through actual purchases otc?
Through the futures market?
NewBondBear | 12.30.08 - 4:33 pm |
The same way Japan did it - monetization. Even the threat of monetization is probably enough in the short-term to get the speculators and carry traders to pile in.
I argued endlessly that treasury yields were headed down based on one simple argument:
If Japan could do it, so could we - so long as the demand for dollars is there.
What's happened here is nothing new.
MB,
Ignorace is bliss, thanks for demonstrating the truth of the truism...
Banks don't lend on exploration risk, they don't understand it and don't lend on it even in the best of times. There is current lending for development, based on existing proved reserves and volume/price haircuts to provide adequate coverage ratios.
The current price environment will indeed provide entry opportunities, however it will not be with bank lending. Rather, people will raise venture capital or roll their own nut into the game, acquire an exploit the resource and often sell their company to a larger competitor if they reach a critical mass of aggregation in an area of strategic interest...then do it all over again.
My poor heart. Ticker reporting the Fed will use Blackrock, Goldman, etc. to manage the passive buying and holding of MBS starting next month. The firms have to promise firewalls twixt these new desks and the trading desks. Yeah right.
...so all you need is a winning business plan, right? Let's see how far you get, or how relevant you are? That industry has long passed the point of competition. It's a Trust, for all practical purposes, and the only remaining undecided is who gets the last drops. It's time to Nationalize these Plutocratic Cash Cows.
Morocco Bama | 12.30.08 - 4:32 pm | #
Hrm, let's see.... an Oligopoly wherein different players strive to extract the maximum value out of their commodities through price, but wherein the amount of value any one player can extract is by the willingness and desire of the competition to extract a little more (don't give me elasticity arguments, share matters) through lower prices. OR, a state monopoly in which one player gets to extract as much value from the commodity as it pleases?
Lesse... I'll take option 1. At least in that scenario, we can try to seek recourse through the courts in any proven case of collusion. Recourse in option 2 requires guns and bloodshed, and I'm really a peace-loving guy.
Argument Mish is making is that credit is going to credit heaven ...
however, on the other hand...
Saturday, December 6, 2008
This time it's Austrian
Citizen Grant reports in his latest missive that the Annualized Rate of Growth (over the last 3 months) of rentenmarks (Federal Reserve Bank Credit) is 2596.3%.
Wednesday, November 19, 2008
Rentenmarks and mops
Citizen Grant reports in his Novemeber 14th missive that the Fed has expanded its rentenmarks (Federal Reserve Bank credit) at an annual rate of 1,560.5%.
In related news, the Guinness Book of World Records is trying to determine the largest mop ever made.
and I don't see that it's any more searchable than halo (which is my biggest complaint).
Comrade JoeBlo | 12.30.08 - 3:48 pm | #
I agree. JS-Kit promises searching, but it's really just filtering for the current thread. My next task had been to build a searchable index of the comments, but that has to move to the back burner if I'm going to do this port. If the format looks similar (i.e. no threading or paging), it might not be too much work (hint, hint).
I'm going to miss JAS.
I think CR and its Commentariat have a symbiotic relationship but they are clearly not the same organism.
I think that this is probably going to be what kills the goose that laid the golden egg, but that it's still unavoidable. One good channer raid and we'd be toast for weeks or months.
I hope that you focus very intently on getting the right technology, CR. The gabbling charlatans and mountebanks in your living room are not necessary to you, but it is a wonder of the world in a jewelbox you hold in your hand.
You may miss it more than you expect if you are careless with it. I hope that you will use your utmost forethought in considering these issues.
BTW, what was the news in the last 30 minutes today?
Or is it just year end gremlins?
"Gary I think you are an ignoramus as well but am with you on this point."
God damn, I do love this place.
Argument Mish is making is that credit is going to credit heaven ...
however, on the other hand...
Saturday, December 6, 2008
This time it's Austrian
Citizen Grant reports in his latest missive that the Annualized Rate of Growth (over the last 3 months) of rentenmarks (Federal Reserve Bank Credit) is 2596.3%.
Well, that's just paper credit, not necessarily the real thing.
It remains to be seen whether these actions generate real credit (the lending of resources in the real world).
The Fed is fundamentally working with illusions. The question is whether or not people believe in them.
Gary writes:
BTW, what was the news in the last 30 minutes today?
Or is it just year end gremlins?
Gary | 12.30.08 - 4:43 pm | #
Yeh, I got yer benchmark right here
By Jason Zweig
Wall Street Journal
Sunday December 21, 2008
Painting the tape is a one-day wonder. Historically, 80% of all U.S. stock funds and 91% of small-company funds have beaten the market on the last trading day of the year - and roughly two-thirds have given most of that gain right back on the first day of the following year.
ew FED program -- $500b funded with resereves - purpose to buy MBS -- Blackrock, Pimco and Goldman will manage the deal
BTW, what was the news in the last 30 minutes today?
Gary | 12.30.08 - 4:43 pm | #
Duh! The federal government bailed out GMAC, creating new markets of opportunity for interested buyers of GM products to get more cars.
/sarc off
Agreed.
Well, that's just paper credit, not necessarily the real thing
ac | 12.30.08 - 4:46 pm
Convexity monetizes the long bond.
roadkill writes:
new FED program -- $500b funded with resereves - purpose to buy MBS -- Blackrock, Pimco and Goldman will manage the deal
roadkill | 12.30.08 - 4:47 pm | #
I remember when a +2% on the Dow meant something. Those were the days.
Methinks Rosenberg's 1.5% call on the 10yr is gonna happen.
Zirpmeister Ben is building a BLINGFENCE.
comrade swan writes:
Convexity monetizes the long bond.
roadkill writes:
new FED program -- $500b funded with resereves - purpose to buy MBS -- Blackrock, Pimco and Goldman will manage the deal
roadkill | 12.30.08 - 4:47 pm | #
comrade swan | Homepage | 12.30.08 - 4:49 pm | #
When I was a kid you could wander around Montzeumas Castle, a semi Canyon de Chelly place in AZ. It was not much fun going inside tho. Over the years people had urinated and what have you inside the rooms.
About the same time I had a secret hiding place in a cleft up in a semi-sandstone canyon. My handholds had been carved in the rock by some long ago Indian. It was right near a sacred area that BLM had driven heavy equipment through. Also dynamited a good part of it.
The taxpayers are funding the buying of crappy cars for people who won't own the car in 2 years because it will have been repoed. They, our leaders, do not have a clue. That is been obvious for awhile. The only thing positive that can be said is that ... Well, someone will think of something.
OT:
Anyone else here find it really sad (as a Mac user or not) that the market has so much confidence in Apple's business model that it tanks the company's stock everytime Jobs gets a head cold?
I always thought a business was supposed to trascend any one man.
Well, that's just paper credit, not necessarily the real thing...
Is this like that rollover minutes vs. new minutes joke? Isn't all credit paper credit?
I had options when I worked at AAPL - cashed them out, because I didn't want to hold stock that depended so heavily on the life of one man.
re : Pavel Chichikov | 12.29.08 - 7:08 pm | #
...The Holy Father,...
On the pope, I have to pass, never read any of his writings. Hope you can enlighten me if I missed anything.
...St. Thomas Aquinas and Dante...
I am not sure how to phrase it. If I were flippy, I would say : Are these the Greats who thought the earth was flat? And if you reached the edge of it, you'd fall off into the depths of the universe?
I think to do them justice you need to see/interpret them within the context and limitations of their time.
The old Germans probably also had their (then valid) reasons to believe that lightning and thunder was caused by "Wotan" and "Donar" (German deities) swinging their hammer and driving about in chariots.
Well, today you can not even persuade a schoolchild of that.
Face it, St. Thomas Aquinas and Dante did not even have the use of a telescope. Or a notion of gallaxies (plural here!). It's not even 90 years since Edwin Hubble recognized that some of these "smudgy stars/nebulas were actually galaxies.
So, why would one base/limit the discussion of something that fundamental to the confines of the restricted knowledge of people who thought the earth was flat., etc. ?
The question is whether or not the reserves will go through the fractional reserve system sausage grinder where it starts chasin' goodies (inflation) or to credit heaven.
Rob Dawg writes:
Well, that's just paper credit, not necessarily the real thing...
Is this like that rollover minutes vs. new minutes joke? Isn't all credit paper credit?
Rob Dawg | Homepage | 12.30.08 - 4:52 pm | #
Anyone else here find it really sad (as a Mac user or not) that the market has so much confidence in Apple's business model that it tanks the company's stock everytime Jobs gets a head cold?- RockyR
Try drinking a Pepsi on the way to the Home Depot to spend some of your Countrywide HELOC and get back to us.
Without Jobs the fear is that Apple becomes Sun Microsystems in slow motion decline.
The world is getting ready to move on. Yet, as Dryfly has said, it will be more of the same. Somehow I don't get the warm fuzzy over that.
I have absolutely nothing to base this on, other than chemical imbalance perhaps, but we are very close to the point were history marks time as a before or after the event.
of their commodities
See, that's where we disagree. It's not their's, any more than the air is their's, or the water, or DNA. It's become such a fabric of life that no Corporation should be able to lay claim to it and sell it on an open, speculative market.
Is this like that rollover minutes vs. new minutes joke? Isn't all credit paper credit?
Rob Dawg
I would argue that real credit is something like lending your tractor to your neighbor for a week in exchange for a chicken.
This allows much more efficient use of resources and permits the type of economy that we have today.
Of course if you neighbor skips town, you never get your tractor back and are unlikely to engage in such a transaction in the future.
IMO this is real credit/debt.
Now we have pieces of paper that supposedly represent real wealth, but that doesn't mean they do.
If the Fed creates more lending of money (paper credit) without generating more real credit transactions (like described above) then they're accomplishing nothing except the destruction of the dollar (as more and more dollar based credit ends up being fictional).
Mish has excellents posts, but generally the comments are only interesting when he is calling someone out.
Mortgage backed securities JOY!!!!!!
The rally is on!
Press Release
Federal Reserve Press Release
Release Date: December 30, 2008
For immediate release
The Federal Reserve on Tuesday announced that it expects to begin operations in early January under the previously announced program to purchase mortgage-backed securities (MBS) and that it has selected private investment managers to act as its agents in implementing the program.
Under the MBS purchase program, the Federal Reserve will purchase MBS backed by Fannie Mae, Freddie Mac, and Ginnie Mae; the program is being established to support the mortgage and housing markets and to foster improved conditions in financial markets more generally.
Further information regarding the structure and operation of the MBS purchase program is provided in the attached set of Frequently Asked Questions (FAQs).
What is the policy objective of the Federal Reserves program to purchase agency mortgage-backed securities?
The goal of the program is to provide support to mortgage and housing markets and to foster improved conditions in financial markets more generally.
Why is it necessary for the Federal Reserve to transact in the agency MBS market via external investment managers?
The operational and financial characteristics of MBS purchases are significantly more complicated than those associated with the assets that have traditionally been purchased by the Federal Reserve. The Federal Reserve has chosen external investment managers as a means of implementing the MBS program quickly and efficiently while at the same time minimizing operational and financial risks.
Because of the size and complexity of the agency MBS program, a competitive request for proposal (RFP) process was employed to select four investment managers and a custodian. The investment managers are BlackRock Inc., Goldman Sachs Asset Management, PIMCO and Wellington Management Company, LLP. The selection criteria were based on the institutions operational capacity, size, overall experience in the MBS market and a competitive fee structure. The contract for a custodian is not yet final.
What securities are eligible for purchase under the program?
Only fixed-rate agency MBS securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae are eligible assets for the program. The program includes, but is not limited to, 30-year, 20-year and 15-year securities of these issuers. The program does not include CMOs, REMICs, Trust IOs/Trust POs and other mortgage derivatives or cash equivalents. Eligible assets may be purchased or sold in specified pools, in to be announced (TBA) transactions, and in the dollar roll market.
What is the investment strategy that will be employed?
Investment managers will employ a passive buy and hold investment strategy in accordance with investment guidelines prescribed by the Federal Reserve. Purchases will be guided by commonly referenced market indices. The agency MBS program will involve the outright purchase of up to $500 billion in agency MBS by the investment managers on behalf of the Federal Reserve by the end of the second quarter of 2009. The New York Fed will adjust the pace of its purchases based on input from the investment managers about market conditions and the impact of the program. The investment managers will be required to purchase securities frequently and to disclose the Federal Reserve as principal.
The investment strategy may involve the use of dollar rolls as a supplemental tool to smooth market supply and demand. A dollar roll is a transaction involving the sale of agency MBS for delivery in the current month and the simultaneous agreement to repurchase substantially similar (although not the same) securities on a specified future date.
Does the agency MBS program expose the Federal Reserve to increased risk of losses?
Assets purchased under this program are fully guaranteed as to principal and interest by Fannie Mae, Freddie Mac, and Ginnie Mae, so the Federal Reserve's exposure to the credit risk of the underlying mortgages is minimal. The market valuation of agency MBS can fluctuate over time based on the interest rate environment; however, the Federal Reserve's exposure to interest rate risk is mitigated by the conservative, buy and hold investment strategy of the agency MBS purchase program.
When will the purchases begin?
Purchases are expected to begin in early January, 2009.
Who will the investment managers trade with and who is eligible to sell agency MBS to the Federal Reserve under the program?
Initially, the investment managers will trade only with primary dealers who are eligible to transact directly with the Federal Reserve Bank of New York. Primary dealers are encouraged to submit offers for themselves and for their customers.
Will the agency MBS held by the Federal Reserve through this program be eligible for lending through the Treasury Securities Lending Facility (TSLF) or the daily System Open Market Account (SOMA) securities lending operations conducted by the New York Fed?
There are no plans for the agency MBS held by the SOMA to be available for borrowing through the TSLF or the daily securities lending program.
How will purchases under the agency MBS program be financed?
Purchases will be financed through the creation of additional bank reserves.
What is the legal basis for the agency MBS purchase program?
Purchases of agency MBS in the open market, under the direction of the FOMC, are permitted under section 14(b) of the Federal Reserve Act.
How is the Federal Reserves agency MBS purchase program related to the U.S. Treasurys efforts to purchase agency MBS?
The Federal Reserves agency MBS program is separate and distinct from the U.S. Treasurys program but both programs are aimed at fostering improved conditions in mortgage markets.
How will holdings under the agency MBS program be reported?
Balance sheet items related to the agency MBS purchase program will be reported after settlement occurs on the H.4.1. statistical release titled Factors Affecting Reserve Balances of Depository Institutions and Condition Statement of Federal Reserve Banks. There will be an explanatory cover note on the release when the new items appear for the first time. However, these data may be published well after trade execution due to agency MBS settlement conventions. In addition, the New York Fed will publish the SOMA agency MBS activity in more detail on its external website on a weekly basis.
What measures will the Federal Reserve take to ensure that an investment manager implementing the MBS program will not have an unfair advantage relative to other market participants due to the information it receives about the MBS program?
Each investment manager will be required to implement ethical walls that appropriately segregate the investment management team that implements the Federal Reserves agency MBS program from other advisory and proprietary trading activities of the firm. The New York Fed will monitor each investment managers compliance with this requirement.
Anyone else here find it really sad (as a Mac user or not) that the market has so much confidence in Apple's business model that it tanks the company's stock everytime Jobs gets a head cold?
I always thought a business was supposed to trascend any one man.
RockyR
Well people remember how Apple went to hell in the 90s after Jobs was gone. Its revival seemed to occur with his return.
I remember doing work on products related to Apple around 1996 and we really had the feeling we were working on a dying platform.
Meanwhile Ford weeps quietly in the corner.
Lyon writes:
Mortgage backed securities JOY!!!!!!
The rally is on!
Press Release
Federal Reserve Press Release
Release Date: December 30, 2008
For immediate release
(Release Time: 3:40pm for those with secret decoder rings)
The Fed said it "has selected private investment managers to act as its agents in implementing the program," which is "separate and distinct from the U.S. Treasury's program." The purchases will be financed through the creation of additional bank reserves, the Fed said.
So this is what we just talked about - devaluing the dollar to drive down interest rates.
Well people remember how Apple went to hell in the 90s after Jobs was gone. Its revival seemed to occur with his return.
I remember doing work on products related to Apple around 1996 and we really had the feeling we were working on a dying platform.
ac | 12.30.08 - 5:03 pm | #
I'm an Apple convert who was staunchly PC in 1996. I love their products now but then again, I loved Sun Workstations too. I guess I'll stick to buying their products and not their stock.
And it is so wonderful......I need a bottle of vodka to calm me down. I feel like I was dosed with ecstasy....
30yr fixed headed to 4.00%
Wasn't sure why Wellington was named ... but now I do, there are the 3rd largest institutional holder of GS stock.
Welcome to the 'waste management business'.
GOLDMAN SACHS
TOP INSTITUTIONAL HOLDERS
Holder Shares % Out Value* Reported
Barclays Global Investors UK Holdings Ltd 17,355,918 4.39 $2,221,557,504 30-Sep-08
STATE STREET CORPORATION 16,769,356 4.24 $2,146,477,568 30-Sep-08
WELLINGTON MANAGEMENT COMPANY, LLP 15,840,670 4.01 $2,027,605,760 30-Sep-08
"I am not sure how to phrase it. If I were flippy, I would say : Are these the Greats who thought the earth was flat? And if you reached the edge of it, you'd fall off into the depths of the universe?"
Do you think physics for the rest of time will be only a gloss on the physics of 2008? And do we value Dante for his exposition of physical science, and Augustine for his textbook on physical chemistry? Really, Werner, I'm surprised at you.
Do you discount Shakespeare for not having a doctorate in chemical engineering?
Augustine, educated in good classical Hellenistic schools, no doubt thought of the Earth as a sphere - Dante as well, probably.
These comments are probably why I'm going to be rejected this forum as incorrigibly off-topic.
roadkill writes:
new FED program -- $500b funded with resereves - purpose to buy MBS -- Blackrock, Pimco and Goldman will manage the deal
roadkill | 12.30.08 - 4:47 pm |
I know he's offline this week, but if you listen really really quietly, I think you can actually hear Eric weeping for his puts.
The purchases will be financed through the creation of additional bank reserves, the Fed said.
ac | 12.30.08 - 5:05 pm | #
30yr fixed headed to 4.00%
Lyon | Homepage | 12.30.08 - 5:07 pm | #
Q? Is it possible to have high inflation with low interest rates? My memory from schoold would say: "no".
I played around with the original iPod before it was released. I thought it was spiff but overpriced ($400) and no one would buy it. I was worng. It came out just as the Decade of Conspicuous Consumption began, and your $100 Abercrombe and Fitch T-shirt didn't look cool enough without an overpriced gadget swinging from it.
If Apple had remained a computer company (no longer Apple Computer, Inc.), it would have failed. The iProducts have kept it alive.
"Mortgage backed securities JOY!!!!!!"
Now Barney and Co. 'have to' approve TARP's 2nd installment. Get ready for Hooocooodanode part II.
I'm an Apple convert who was staunchly PC in 1996. I love their products now but then again, I loved Sun Workstations too. I guess I'll stick to buying their products and not their stock.
RockyR | 12.30.08 - 5:06 pm |
I don't have an Apple, but I'd consider buying a Mac OS system now because it's Unix based (though I'll keep my Windows systems).
Something about it makes me feel warm and fuzzy:
"This is UNIX! I know this!"
How about an iPhone app? Reading comments is a pain on the iPhone. Charge money for it too I would install it .
ac writes: IMO you have to look more at a combination of the dollar's value and interest rates to see what the market thinks.
Because the Fed can create money and use it to intervene in FX markets, right?
ooops sorry i didn't realize we were going to finance this with freshly printed paper.
Q? Is it possible to have high inflation with low interest rates? My memory from schoold would say: "no".
RockyR | 12.30.08 - 5:09 pm |
In a free market, maybe not.
But we haven't had free credit markets in this country in a long time...
Q? Is it possible to have high inflation with low interest rates? My memory from schoold would say: "no".
RockyR | 12.30.08 - 5:09 pm | #
Watch and enjoy.....it's time to get PAID!!!!!!!!
"This is UNIX! I know this!" - ac
Yeah, that's how it starts. Then there's the running and the screaming...
Dear SC/CR,
Can you please maintain two separate threads:
- one for comments related to your current post
- and another one for comments, well, not related to your current post (like Israel and Palestine, Christians and Muslims, Stalin and Hitler)
MrM | 12.30.08 - 3:53 pm | #
I second this idea. I really like the open threads because there are times when I am just not very interested in the relationship between NY real estate prices and divorce, or let's say, I'm not interested in COMMENTING on it or reading other's comments on it. How about a new open thread when the old one reaches 200 comments, for example? It could probably be done automatically somehow, I bet Mr. Ken Cooper could assist here.
1/3 of today's volume in last 15 minutes
Ok, Pavel, here it comes : And don't worry about being thrown out of CR. They will never throw you out!
At first, I presume that you will not find a telescope in any way misterious. (If not, tell me.)
Astronomers have used telescopes over several decades to explore the universe. A conservative guess i found was that there are 200 billion galaxies each consisting of 200 billion stars. And our sun is just an ordinary average star. So, that gives 4x10^22 stars or suns in the universe. (I once heared an astronomer (PhD) using the number 10^25; it doesn't matter. And for reasons becomming apparent below, I prefere the more conservative figure.)
Now, a 4 followed by 22 zeros is a figure even profligate americans have not (yet) managed to spend.
But let's try to visualize that number :
Imagine a beach, where the sand grains are 1 mm apart (that would make them a tad larger than 1 mm, let's say 1.2 mm; I am too lazy to do the correct calculation). So 1 qubic meter (1 m^3) would then contain 10^9 sand grains. Imagine a beach 10 m deeep, 100 m wide (water to land) and 1 m long : it would cotain 10^12 grains; make it 1 km long, and you have 10^15 grains. A length of 40.000 km (earths circumference on the equator) then gives you 4x10^19 grains.
So, if you wind a beach 10 m deep, 100 m wide 1000 times around the earth on the equator, it would have the same number of 1 mm apart grains as the universe has stars or suns respectively.
As you probably suspect, the story continues : Take one grain of that beach (call it sun) and imagine it has eight little specs of dirt attached (planets) and on one of these specs (earth) are 6+ billion bacteria (people). And one of these bacteria telling his friendly neighbor bacteria : "Last night, I folded my (bacteria-) hands and joined in dialog with the Maker of that whole beach."
But that is exactly what the Roman Catholic Church tells us : "If you fold your hands and pray, you enter into a dialog with God" (the creator of the universe) ! Or : "If three of you are congregated in my name, I will be amongst you."
Now, what would you say ? Plausible ?
If memory serves another half a trillion and we match the balance sheet percentage increase that the Japanese accomplished with their QE but in less than 1/4 the time...
We went to ZIRP 4X faster too..
I don't have an Apple, but I'd consider buying a Mac OS system now because it's Unix based (though I'll keep my Windows systems).
Something about it makes me feel warm and fuzzy.
The warm and fuzzy feeling I have about by iMac running OS X emanates mostly from my near inability to crash it. I restart about once every two months (when there's a software upgrade to be installed -- just put it to sleep the rest of the time) and it's stable as a rock. Contrast with my HP laptop from work running XP which is pretty much guaranteed to freak out if it isn't rebooted at least once a day. And XP is the "good" Microslop OS.
Did anyone else notice this over at Clusterstock?
Troubled Banks: The List
"Fortunately, libertarian blogger Chris Brunner has decided to put together an independent list of troubled banks. It is based on the "Texas Ratio" developed by Gerard Cassidy, measuring non-performing assets against less government guaranteed loans. "Basically, the higher the ratio, the worse the situation is for that particular bank," Brunner explains. "Banks with a ratio of 100 and higher are in very serious danger of collapse, and banks with a ratio of 50 or higher are vulnerable.""
http://www.lewrockwell.com/chris/banks/banks.html
"Texas Ratio"
An excellent measure
Because the Fed can create money and use it to intervene in FX markets, right?
MrM | 12.30.08 - 5:11 pm |
No, because they can influence interest rates or the value of the dollar, but not both (as I see it). They can raise rates to increase the value of the dollar, and lower rates by devaluing the dollar.
So if they're artificially suppressing interest rates by creating dollars, you'd have to look at the market for dollars to get more of a sense for what real interest rates are based on the market.
If the 10-year yield is at 2%, but the dollar supply is expanding at a 10% rate, then you're realistically looking at a very negative real rate.
BTW if velocity is depressed this won't necessarily show up in the short-term as price inflation. But if the velocity returns...
I don't have an Apple, but I'd consider buying a Mac OS system now because it's Unix based
ac | 12.30.08 - 5:10 pm | #
ac, that is exactly the reason I made the switch. A nicely packaged LINUX implementation that comes with slick hardware to boot!
The warm and fuzzy feeling I have about by iMac running OS X emanates mostly from my near inability to crash it.
In my experience, unix based systems are much more stable than Windows based systems.
OSX being unix-based...
BTW if velocity is depressed this won't necessarily show up in the short-term as price inflation. But if the velocity returns...
ac | 12.30.08 - 5:17 pm | #
So bailing one end of the bathtub will lower the water level if you just bail fast enough...
Watch and enjoy.....it's time to get PAID!!!!!!!!
Lyon | Homepage | 12.30.08 - 5:12 pm | #
Please, tell me how. I don't see how this doesn't absolutely screw me. Oh, wait...
ac, that is exactly the reason I made the switch. A nicely packaged LINUX implementation that comes with slick hardware to boot!
RockyR | 12.30.08 - 5:17 pm |
I said that too, but somebody corrected me and said it's a BSD implementation, not Linux.
"I said that too, but somebody corrected me and said it's a BSD implementation, not Linux."
--ac
It's a BSD kernel, but a lot of code that is normally thought of as part of "Linux" (which is only a kernel itself) runs on it.
"In my experience, unix based systems are much more stable than Windows based systems."
Mine too. Forgive me if I was stating the obvious with my observation that OSX is highly crash resistant.
Watch and enjoy.....it's time to get PAID!!!!!!!!
Lyon | Homepage | 12.30.08 - 5:12 pm | #
Please, tell me how. I don't see how this doesn't absolutely screw me. Oh, wait...
RockyR | 12.30.08 - 5:19 pm | #
Well, if you have a mortgage under $625,500, you could be looking at a 4.00% rate soon.
If you are in the mortgage business like me? Well, looks like a 7 figure year.
No, because they can influence interest rates or the value of the dollar, but not both (as I see it). They can raise rates to increase the value of the dollar, and lower rates by devaluing the dollar.
Also note that this is only possible because of the fiat system. With a gold-backed system the value of the dollar is fixed.
ac - I meant that the Fed could use the fiat money it created (say by selling bonds) to buy USD and maintain the FX rates, but at the expense of rising yields/interest rates. We are saying the same thing.
So the Fed is now going to buy MBS's with newly created funds? Does anyone know if this applies only to existing loans or can it also be done with NEW mortgages? Is this going to put a floor on the housing decline? Is this a harbinger of massive dollar devaluation?
As a guy who wants to buy a house, this is making wonder if it is about time to jump off the sidelines. On the other hand, I was pretty sure we are looking at big price declines this year in Socal. What do you think?
My Macs vs PCs (XP, Vista) crash at about the same rate, which is rarely.
I also don't load my PC up with a bunch of crapware, which is usually the crash culprit.
"Last night, I folded my (bacteria-) hands and joined in dialog with the Maker of that whole beach."
To which the other bacteria replies: "No. The whole beach and everything in it just spontaneously appeared. Matter form nothing and order from chaos. Happens all the time."
stretch002 writes:
So the Fed is now going to buy MBS's with newly created funds? Does anyone know if this applies only to existing loans or can it also be done with NEW mortgages? Is this going to put a floor on the housing decline?
Well, if you have a mortgage under $625,500, you could be looking at a 4.00% rate soon.
If you are in the mortgage business like me? Well, looks like a 7 figure year. - Lyon
What makes you think you'll be allowed to charge what you used to charge?
What makes you think you'll be allowed to charge what you used to charge?
Rob Dawg | Homepage | 12.30.08 - 5:27 pm | #
It's called a rate sheet and has something called yield spread premium on
it.
I think this kind of lack of "creative thinking" caused him to overlook the emergence of the housing bubble (I recall him saying he was surprised by it in a podcast).
ac | 12.30.08 - 4:18 pm | #
ac,
He was quite aware of the housing bubble. He simply expected it to pop much earlier.
Here is a post from late 2004:
http://siliconinvestor.advfn.com/readmsg.aspx?msgid=20901807
Here another from October 2004:
http://siliconinvestor.advfn.com/readmsg.aspx?msgid=20665036
My Macs vs PCs (XP, Vista) crash at about the same rate, which is rarely.
I also don't load my PC up with a bunch of crapware, which is usually the crash culprit.
Speed
Not loaded with crapware? But, but you just said you installed XP and Vista. Which is it?
As a guy who wants to buy a house, this is making wonder if it is about time to jump off the sidelines. On the other hand, I was pretty sure we are looking at big price declines this year in Socal. What do you think?
If you want the house to live in rather than as an investment, and you pay no more than 3x income for it, you don't need to solicit anyone's advice.
ac - I meant that the Fed could use the fiat money it created (say by selling bonds) to buy USD and maintain the FX rates, but at the expense of rising yields/interest rates. We are saying the same thing.
MrM
Well I don't think they would be creating dollars to buy dollars. What they could do is create dollars to buy other currencies, but that drives the value of the dollar down.
The FX rates are based on other currencies, which the Fed does not control.
So they can't print dollars to somehow buy more dollars and drive up the price, if that's what you're getting at.
It's called a rate sheet and has something called yield spread premium on it. - Lyon
And you expect to preserve that margin? Ask some realtor buddies if they are pulling 6% on REO deals.
The FX rates are based on other currencies, which the Fed does not control.
BTW this is why I say it's useful to look at the FX markets to determine real interest rates - precisely because the US Fed doesn't control them. Of course if other central banks are all doing the same thing you have to take that into account.
Normally, I do not charge points up front. I get paid by the lender. The rate sheet has coupons on it with YSP next to it.
The normal YSP for a deal is 1.00% for an A credit deal.
And you expect to preserve that margin? Ask some realtor buddies if they are pulling 6% on REO deals.
Rob Dawg | Homepage | 12.30.08 - 5:30 pm |
That has nothing to do with what I do.
ac,
He was quite aware of the housing bubble. He simply expected it to pop much earlier.
Here is a post from late 2004:
From the perspective of the markets I think spring/summer 2003 was key for the housing bubble.
That's when the bond market seemed to wake up to what was going on, and ultimately the stock market.
By "seeing the housing bubble" I really mean realizing in late 2002, early 2003 that this thing was going to keep going for years to come.
I wasn't really paying attention at the time, so I don't know if I would have.
If you are in the mortgage business like me? Well, looks like a 7 figure year.
Lyon | Homepage | 12.30.08 - 5:22 pm | #
Ahh... looks like I better get out of software and into the mortgage business!
The 3x income is a nice way to gauge if I can afford to buy the house.
I am asking whether the Fed MBS purchases change my strategy of waiting another year for further declines. Do you think this will artificially slow down or halt the price declines over the course of the next year?
Note: I am buying a house at under 3x annual income. I just would like to pay as little for it as possible here in bubbly SoCal.
Okay, the bottom must be finally coming soon, I just put in a bid on some REO- a totally insulting bid, but the current total bid was $0.
So hey, either they takes it, or not.
Cost me nada.
Phoenix is overwhelmed with houses right now. Nothing like a surplus!!!
Someday this war's gonna end...
My Macs vs PCs (XP, Vista) crash at about the same rate, which is rarely.
Speed | 12.30.08 - 5:26 pm | #
PCs have improved significantly.
Ahh... looks like I better get out of software and into the mortgage business!
RockyR | 12.30.08 - 5:37 pm
Not so fast...what the Fed giveth they taketh away.....
The normal YSP for a deal is 1.00% for an A credit deal. - Lyon
I don't think you want to understand what I am saying because your livelihood depends on not hearing it. I know how the market used to work. What I am saying is that with these managed MBS products you aren't going to get 1.00% anymore. This is not 2006. You really think Bill Gross is gonna let you charge him 4 large for processing paperwork?
BTW this is why I say it's useful to look at the FX markets to determine real interest rates - precisely because the US Fed doesn't control them. Of course if other central banks are all doing the same thing you have to take that into account.
ac | 12.30.08 - 5:32 pm | #
I think I have some learning to do here. I'm not sure I know how to look at FOREX market data and relate that to t-bill yields to arrive at some idea of the real rate of return on a treasury note.
You may miss it more than you expect if you are careless with it. I hope that you will use your utmost forethought in considering these issues.
Comrade Byzantine_Ruins | Homepage | 12.30.08 - 4:43 pm | #
I think CR is aware of that. However, CR also needs to consider what goes out in his name. Comments are often considered reflective of the blogger. CR has a reputation to protect.
I know which way I'd lean in his shoes...
Rob Dawg you are my new hero.
know how the market used to work. What I am saying is that with these managed MBS products you aren't going to get 1.00% anymore. This is not 2006. You really think Bill Gross is gonna let you charge him 4 large for processing paperwork?
Rob Dawg | Homepage | 12.30.08 - 5:41 pm
You must be smoking dope. I am getting 1.00% back at least on all my deals now...That's not going to change. Right now 4.875% is back 1.00%. Want me to send you some rate sheets?
Rob Dawg | Homepage | 12.30.08 - 5:41 pm
I think you have a serious misunderstanding of how the mortgage lending/brokerage business works.
Denninger:
The paradox that Bernanke is in danger of discovering (the hard way) is the paradox of a pilot who finds himself in a flat spin. As the ground approaches he wants to pull back on the stick but if he does so, the spin simply tightens as the wings are not producing lift - the angle of attack is too high, not too low. As such if he does what his brain screams at him to do instinctively, he dies.
Or the scuba diver who sucks on the reg and gets nothing. Your instinct is to hold your breath and kick for the surface. If you do it you die.
How about an iPhone app? Reading comments is a pain on the iPhone. Charge money for it too I would install it .
Rationaljeff | 12.30.08 - 5:10 pm | #
I've thought about this too, having recently acquired one myself (what a great device!).
Are there enough people here who would use it?
I think you have a serious misunderstanding of how the mortgage lending/brokerage business works. - Lyon
Fair enough because I think you have a serious misunderstanding of how the mortgage lending/brokerage business is going to work in the future.
We're even except I do know how the brokerage business works and you cannot accept that change is inevitable.
You must be smoking dope. I am getting 1.00% back at least on all my deals now...That's not going to change. Right now 4.875% is back 1.00%. Want me to send you some rate sheets?
Lyon | Homepage | 12.30.08 - 5:46 pm | #
1%? 1% of what? The interest on the principal? The total loan?
I just got a shiny new Iphone for xmas. I'd LOVE a CR app. I'd even pay for it!
Release Date: December 30, 2008
For immediate release
The Federal Reserve on Tuesday announced that it expects to begin operations in early January under the previously announced program to purchase mortgage-backed securities (MBS) and that it has selected private investment managers to act as its agents in implementing the program.
Ok, how do we play this one? Buy an ETF that has Fannie/Freddie?
Shedlock is not to be imitated in any way. He's a sham. He's cranky because he knows he's wrong.
We may have deflation but the end game with a fiat currency will be inflation. The only question is if it morphs into hyperinflation.
His political opinions are naive to the point of being childish.
He chooses data points that support his deflation position and ignores anything to the contrary. He once cited the fact that pork chops were on sale in his supermarket as evidence of deflation.
Last summer he was going on about peak oil, as if he has any idea about the validity of that concept.
His commenters, who were never a sparkling group to begin with, have devolved into newbies and not too bright folk who are so lacking in discernment that they think he's the latest thing. As someone above mentioned they do a lot of the "Gee Mish, you're wonderful" thing and apparently he laps it up.
You must be smoking dope. I am getting 1.00% back at least on all my deals now...That's not going to change. Right now 4.875% is back 1.00%. Want me to send you some rate sheets?
RockyR | 12.30.08 - 5:51 pm | #
If it's 1% of the spread, you have to push A LOT of paper to make 7 figures... I'm still impressed.
New commenting regime should be interesting. I'll have to behave myself or change my name or change my IP address or change both.
We're even except I do know how the brokerage business works and you cannot accept that change is inevitable.
Rob Dawg | Homepage | 12.30.08 - 5:51 pm | #
Really? So they you believe that the Feds want to take away incentive in the wholesale arena by getting rid of YSP?
Guess what, the customer then has to pay out of pocket that point up front, whether it is to a bank with much higher fees, or me with way lower fees.
Is that really what you think they are trying to do?
Don't think so.
ChefVisar writes:
RE (in case you missed it from last thread)
"Have a look at this link. Especially the yellow table."
Thanks for the link. Thayer Watson also has a very nice summary of B/C Methodology on his website, for anyone interested in that sort of thing.
As for the consumption problem -- its very clear that government stimulus of the economy through purchases is nearly inconsequential.
ChefVisar | 12.30.08 - 5:19 pm | #
If it's 1% of the spread, you have to push A LOT of paper to make 7 figures... I'm still impressed.
RockyR | 12.30.08 - 5:55 pm
I have been in business 8 years and have a client list of 850 people.
As of now, my pipeline is getting close to 40 million....and growing. This happened in 1 month.
New Commenting Form.....just another learning curve for the chronologically challenged. I've barely adapted to using this keyboard. The one on the Remington was kinda clunky, but it worked GREAT!
Seven figures is 1.00% of $100m or 200-300/yr. Back in the days brokers could earn their fee by working the sheets for the best deal and walking the buyer through the pitfalls. With one buyer calling the shots and all the competition crowded out it isn't much of a value added service to read from the morning fax sheet.
RD VS LYON
Tonight starting @ 5pm est
for help with the conversation
ysp is yield spread premium(that's what gets lyon paid)
Does anyone have a guess as to how the Fed buying MBS's will affect housing prices? How it will affect mortgage rates?
of a value added service to read from the morning fax sheet.
Rob Dawg | Homepage | 12.30.08 - 6:01 pm
It's actually emailed now....And you can keep dreaming my life is gonna suck....
Just keep dreaming...
stretch002 writes:
Does anyone have a guess as to how the Fed buying MBS's will affect housing prices? How it will affect mortgage rates?
stretch002 | 12.30.08 - 6:02 pm | #
Housing prices will stabilize and rates are going way down.
real mortgage pro's have real dogs.
Housing prices will stabilize and rates are going way down.
Lyon
In otherwords "It's a great time to buy!"
So they you believe that the Feds want to take away incentive in the wholesale arena by getting rid of YSP?...
Is that really what you think they are trying to do?
Don't think so. - Lyon
You make an excellent point. With the massive undersupply of mortgage brokers in the business and the huge barriers to entry and the lack of lending expertise by designated aggregators the likes of Goldmans, Blackrock, and Pimco the highly trained and carefully vetted mortgage broker is a valuable commodity who needs to be incented with ever higher compensation levels.
cheap shot writes:
real mortgage pro's have real dogs.
cheap shot | 12.30.08 - 6:05 pm
That is a Jack Russell Terrier my friend, pound for pound one of the toughest pooches out there..used for hunting...and his name is Walter!
ikes of Goldmans, Blackrock, and Pimco the highly trained and carefully vetted mortgage broker is a valuable commodity who needs to be incented with ever higher compensation levels.
Rob Dawg | Homepage | 12.30.08 - 6:06 pm
LOL
touche
By "seeing the housing bubble" I really mean realizing in late 2002, early 2003 that this thing was going to keep going for years to come.
ac | 12.30.08 - 5:36 pm | #
In that case I agree that he didn't see it. Mish became a bear after having been burnt badly as a dot-com bull.
Ken Cooper--Yes on IPhone app!
Well, this YSP holy war is certainly less annoying than other holy wars that have recently polluted this cyberspace. I'd have put my money on a Mac-PC smackdown filling the dead air. Interesting.
Housing market will not stabilize until the employment market stabilizes, wishful thinking of the Fed or Lyon aside...after the glow from the immediate pop, what will continue to be in desperately short supply will be creditworthy borrowers.
Check back with the commentariat in a year's time with your earnings, Lyon. Spare us the angels dancing on the head of a pin and we'll spare you the bullsh!t calls.
No more comments from fresno dan - I tried signing up at the Mish site to comment, and no matter what I do, it won't let me comment. The only thing I can imagine is that I comment from home and from work, and it sees a conflict with my moniker.
Check back with the commentariat in a year's time with your earnings, Lyon. Spare us the angels dancing on the head of a pin and we'll spare you the bullsh!t calls.
citizen energyecon | Homepage | 12.30.08 - 6:09 pm
Envy is a sin......
You have absolutely no idea how much money is going to be made.
lyon, i be willing to bet that's it's 2 whole Ftards of a lot less than was made during the first bubble blowing contest.
"ever higher compensation levels."
This concept interests me intensely, to an almost Chedda-flavored level.
How do I become highly trained and carefully vetted? Does anyone have an address to which I could submit my application?
Envy is a sin...... - Lyon
Not as bad a hubris. Envy doesn't have near the potential to harm others.
Rob Dawg,
Why would Bill Gross want to get rid of the cheapest workforce in the US?
Brokers are an auxiliary to the banks. They pay us no salary, no benefits/health insurance. It's production based.
In your fantasies, we brokers will keep dying a slow death, and you will be glad..as we don't deserve the money we earn.
Keep dreaming....and I'll keep you updated on my earnings throughout the year....and send post cards from St Bart's.
You make an excellent point. With the massive undersupply of mortgage brokers in the business and the huge barriers to entry and the lack of lending expertise by designated aggregators the likes of Goldmans, Blackrock, and Pimco the highly trained and carefully vetted mortgage broker is a valuable commodity who needs to be incented with ever higher compensation levels.
Rob Dawg | Homepage | 12.30.08 - 6:06 pm | #
Rob, you say this as if we live in a world that makes sense... as if we live among the rational. I'll bet Lyon cleans up.
Stories like these just make me regret the engineering degree and technical career that much more. Makes me feel like a chump.
Rob Dawg writes:
Envy is a sin...... - Lyon
Not as bad a hubris. Envy doesn't have near the potential to harm others.
Rob Dawg | Homepage | 12.30.08 - 6:17 pm
sniffle, sniffle....
Foreign Trade Zone Destination...Any experts.
Something about real estate and mortgage brokering attracts some of the biggest self aggrandizing blowhards out there. Crowing in an anonymous forum about how much money you are making, or will make, is beneath obnoxious.
I am skeptical that the Fed will be able to hold mortgage rates down for long. The rates are held down by purchases, not holding, of MBSs.
I wonder, however, if there might be a substantial short term opportunity here.
How do I become highly trained and carefully vetted? Does anyone have an address to which I could submit my application? - j marston
You might want to look at this story from January:
Exurban Nation: Put Down Your Coffee First
This is getting lame. I am going to the bar to drink martini's and get laid.
Ken Cooper, I would REALLY be sad to give up the CR companion! It works incredibly well. It is a great asset to the site. I hope you can perform your magic again on any new programs!
This is getting lame. I am going to the bar to drink martini's and get laid.
Lyon
Make sure he's over 18
If JS-Kit could be renamed JSixPack then I'm all for it.
I am going to the bar to drink martini's and get laid.
Then, in the afterglow, hopefully master the important difference between plural and possessive.
You have absolutely no idea how much money is going to be made.
Lyon | Homepage | 12.30.08 - 6:13 pm | #
Neither do you - so spare us all your pronouncements in advance - and post your earnings at the end of the year, with a recipe for crow. Someone will eat hearty, and we will know for certain next year.
But bank this - this MBS purchase program will not stabilize house prices - when the price decline express got rolling before the job losses ramp-up got rolling...
In your fantasies, we brokers will keep dying a slow death, and you will be glad..as we don't deserve the money we earn. - Lyon
I guess I must have imagined Aarons ML-Implode too.
"So, if you wind a beach 10 m deep, 100 m wide 1000 times around the earth on the equator, it would have the same number of 1 mm apart grains as the universe has stars or suns respectively.
As you probably suspect, the story continues : Take one grain of that beach (call it sun) and imagine it has eight little specs of dirt attached (planets) and on one of these specs (earth) are 6+ billion bacteria (people). And one of these bacteria telling his friendly neighbor bacteria : "Last night, I folded my (bacteria-) hands and joined in dialog with the Maker of that whole beach."
But that is exactly what the Roman Catholic Church tells us : "If you fold your hands and pray, you enter into a dialog with God" (the creator of the universe) !"
Gosh, Werner, you'd have to be God to be able to create and control a set-up like that.
What you're telling me is that if Werner can't get a grip on that kind of complexity, nobody could, not even God. This is solipsistic thinking with a frosting of question-begging on top.
Excuse me, but why do you take all believers for fools?
Why stop at grains of sand? Why not take into account all the photons in the universe? Now compare with the number of states possible in the human brain.
Accepting for a moment that there is a Creator, what does that make us in comparison? Most certainly, at least, dependents. Eh?
There's a lot more to be said, but better than saying is experiencing. A bacterium that can experience the glory of it.
Don't you ever experience the glory of the world, the mystery of it, the astonishment of it? I'm sure you must.
I'm unfamiliar with j-skat. Does it branch comments, or one long dialogue like haloscam?
As for communicating with the Creator of this glory - call it prayer if you wish - Yes! Yes! You will see.
So even though mortgage rates will be offered at record lows, the bad jobs outlook will prevent the housing market from stabilizing? Do you think this will slow down the declines at all?
I'd been planning to wait another year to buy, but am wondering if I should. Seems if I can negotiate a good discount and lock in a record low mortgage rate it would not be all bad.
Buy or wait...pay cash or finance...
A sense of wonderment and awe has never been a compelling argument in support of the existence of a sky fairy.
"Then, in the afterglow, hopefully master the important difference between plural and possessive."
Sure, then you might meet a cute proof-reader and impress her.
I'd love an iPhone app Ken!!
(posting this from my iPhone...)
Does it branch comments, or one long dialogue like haloscam?
that depends pca,
if the comments are on topic
they proceed: a
b
c
of offtopic: a
b
c
d
Make any sense?
"A sense of wonderment and awe has never been a compelling argument in support of the existence of a sky fairy."
I'm a member of a universal Church with nearly a billion members, and I've never met anyone who believes in a sky fairy.
Literate chicks tend to talk dirty. One of my personal clutchups, sorry.
Office Rentals in NYC ...
CRE brokers like Studely report the fastest ever decline in Manhattan office rents....
SQUARE FEET; A Renter's Market for Manhattan Offices - NY Times
[I am skeptical that the Fed will be able to hold mortgage rates down for long. The rates are held down by purchases, not holding, of MBSs.
I wonder, however, if there might be a substantial short term opportunity here.
Original Eric]
I thought about this a bit. My sense is existing MBS get a bid since their yields, such as they are, will be more attractive. But as those who are still actually paying refi out all that will be left in the pool will make for an intense toxic mess.
So buy cheap, catch the blip... and bail ?
ow that lyon is gone , you guys thought he was gay too, right?
stretch002 writes:
So even though mortgage rates will be offered at record lows, the bad jobs outlook will prevent the housing market from stabilizing? Do you think this will slow down the declines at all?
I'd been planning to wait another year to buy, but am wondering if I should. Seems if I can negotiate a good discount and lock in a record low mortgage rate it would not be all bad.
Buy or wait...pay cash or finance...
stretch002 | 12.30.08 - 6:27 pm | #
Another 18 months or so for me, but then I am 7 months into a two year lease...my WAG is this may make a small hiccup in the house price depreciation tango, but the employment picture will trump - refi's may pop but that will quickly run its course and how does that improve home sales?
So buy cheap, catch the blip... and bail ? - bearly
EVERYBODY thinks they can catch the last lifeboat. Much as Buffet is not doing so good these days he did say he got rich by selling too early.
Him and Bernard Baruch.
now that lyon is gone , you guys thought he was gay too, right? - cheap shot
Metrosexual maybe.
Hey Ken Cooper,
Put me down for the IPhone app too.
some of my favorite comments are the joke ones. does js-kit mean no more posts from:
Son of Jas
Sebastian's Dad
ElCliffoTheSelfHatingDemocrat
etc.
Do not know he anyone has commented yet on this:
Fed Selects Four Firms to Manage MBS Purchase Plan (Update1)
Email | Print | A A A
By Craig Torres
Dec. 30 (Bloomberg) -- The Federal Reserve chose BlackRock Inc., Goldman Sachs Asset Management, Pacific Investment Management Co. and Wellington Management Co. to manage a $500 billion purchase of mortgage-backed securities it plans to complete by June.
Only fixed-rate agency mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae will be eligible for purchase, the central bank said in a statement released in Washington today. The Fed said the purchases, to start early in January, will include securities with maturities of 30, 20, and 15 years, and will exclude riskier securities such as interest-only bonds.
The other thought I had was does this make a mark for MBS assets that will help support bank balance sheets - buy and hold will create 'market' price transactions - or will that affect the volume of paper that is held out there already?
Rob Dawg - couldn't post from work today, but that IP thief who posted the Dawg's Misean Institute curriculum to Jim Sinclair's site with no hat tip changed it in a couple of ways: scrubbed a ref in the Gitmo line and swapped Setser for Perkins in the endocolonialism line.
Skroos the satire in both cases. Guess he didn't get it.
With the new posting system, is there any way we can ensure we get our own current handles again?
C
This is a desperate attempt to get bank lending again right? If all banks know they can sell the MBS to Fannie/Freddie then they will start to make loans again and pocket the fees?
whats gonna happen to the pop-in jokesters?
if there were not a chance for me to snarf cold beer out my nose at least once an evening, I may not read the comments as often.....Ill be stuck going through day old dealbook just to get a giggle...
The vultures! They're taking the best and leaving the GSEs with garbage. Big failures coming.