There is no end in sight ... I expect foreclosure activity in 2009 to be higher than 2008.
It seems every so-called remedy is failing. Halt foreclosures just delays the eventual foreclosure. Most of the modifications still lead to foreclosures.
I'm aware of three parties that are "waiting" for a better "deal" on helping them through their foreclosure mess. The FedGov are the biggest ones to blame. Had they been the "regulators" of last resort, much would have been nipped in the bud.
Any one want to be that we top 10 million in the next two years?
Robert | Homepage | 01.15.09 - 9:30 am | #
I don't like to feed my gambling habit but if it does go double digit there will be a bunch of other bad news that accompanies such as depression level unemployment, civil unrest, a shift in the populace from region to region searching out opportunity, less of an immigration 'problem', perhaps new political party...
"Halt foreclosures just delays the eventual foreclosure. Most of the modifications still lead to foreclosures.
The situations is snowballing."
iceman | 01.15.09 - 9:32 am | #
Per someone at the local courthouse,the only thing keeping this semi under control is the courthouse can only process X number of FC's a day. After that they just get rolled to the next day.
When is everyone going to face the fact that most of these foreclosures are people who never wanted a house or a home? A huge percentage of recent buyers simply wanted to make a lot of money very fast.
Per someone at the local courthouse,the only thing keeping this semi under control is the courthouse can only process X number of FC's a day. After that they just get rolled to the next day."
Well that stuff is rolling in faster than it's rolling out...It's gonna leave an awful stench.
When is everyone going to face the fact that most of these foreclosures are people who never wanted a house or a home? A huge percentage of recent buyers simply wanted to make a lot of money very fast."
Given your first name I'm reminded of point counter point on SNL with Dan Akroid and Jane Curtain...But I will leave Dan's famous opening rebuttal line unsaid.
That said, please tell that to all of the families now and in the recent past who have packed up and moved out. There were specs...but hardly a majority...You better have some good evidence to support that claim.
Everything points to a retest of the previous lows. Credit still stuck to the hubs, BAC is a single digit midget, C is under $5.00, Regions is under $7.00, other regional banks prolly headed south too.
The obvious answer to this is to continue to erect inferior new homes. It reminds me of my father when we were growing up. He would be choking to death at the table but still piling food in his mouth. It was insane, bere he is, he can't breath, he's choking, but he continues to feed himself the very thing that's causintg himself toi suffocate. He's still living, though. And, none of us knew the Heimlich at that time. He would have been toast if he couldn't have dislogded it on his own.
"Well that stuff is rolling in faster than it's rolling out...It's gonna leave an awful stench.
Nostrovia,"
Comrade Misean is Dope | Homepage |
Misean,
How bad is getting here in Florida ya ask...Per the census we have 98k "Housing units" in Charlotte County. I just looked at a graph from the Sarasota paper and it looks like just in 2008 ONLY there were 6100 foreclosures. This is rough because they broke it into months on the graph. But still 6% of the housing is in foreclosure in one year???? I am just gonna crawl under my desk and hide...
Well that stuff is rolling in faster than it's rolling out...It's gonna leave an awful stench. Comrade Misean is Dope | Homepage | 01.15.09 - 9:47 am | #
Don't you mean "streaming in" and "trickling out"?
The continued increase in foreclosures is actually the only sane thing happening right now (BAC bailout, not so much). Recovery requires requires market-clearing prices. The sooner foreclosures drive us there, the better.
....South Florida foreclosures are under reported by a 100%, for every one reported there is another that is not reported by statistical manipulation....no property taxes being paid, public safety budgets cut, etc.....unless there is some financial miracle . . . .
LONDON, Jan 15 (Reuters) - Societe Generale said on Thursday that the United States' economy looks likely to enter a depression and China's could implode.
In a highly bearish note, veteran cross asset strategist Albert Edwards said investors should now cut equity exposure after a turn-of-the-year rally and prepare for a rout.
He predicted that the S&P 500 index of U.S. stocks could be set for a fall of nearly 70 percent from recent levels.
Edwards also raised the danger of a global trade war with China.
bearly writes:
Popeye, how's that rock solid line in the sand of 885 holding up ?
Sorry, I'm about 30 minutes behind in the comments. Bearly, that is the place where I put my stops on that trade. I honored the stops and took the loss when we crossed it.
Morgan Stanley is seeking a supertanker to store crude oil, joining Citigroup Inc. and Royal Dutch Shell Plc in trying to profit from higher prices later in the year, four shipbrokers said.
Eric writes:
I thought you said you pulled your stops
Caught up. You're right. That was on Friday, the 9th as we neared the close the spx dropped to 888. I didn't want to be taken out by a downward spike, so, I pulled my stops. We didn't cross 885 that day, but all I did was switch from auto pilot to manual controls. Instead of being taken out automatically, I pulled the trigger myself on Monday.
Morgan Stanley is seeking a supertanker to store crude oil, joining Citigroup Inc. and Royal Dutch Shell Plc in trying to profit from higher prices later in the year, four shipbrokers said.
Nonsense.
They all got caught long and now can't unload their contracts. Time to take delivery or dump the contracts at the market price (hint - prices will crash lower the minute they try and sell).
Here in Metropolitan New York prices have yet to really fall (maybe -10% after a run-up of at least 200%) but sales have come to a standstill, over a year and a half of inventory (yes, cause and effect) When do people here think the big bust will happen?
Funny how the Ratings agencies weren't fast enough to downgrade the crappy derivatives and are now apparently too quick to downgrade everything in sight.
Societe Generale said on Thursday that the United States' economy looks likely to enter a depression and China's could implode.
In a highly bearish note, veteran cross asset strategist Albert Edwards said investors should now cut equity exposure after a turn-of-the-year rally and prepare for a rout.
He predicted...
OK, but what does Jerome Kerviel think?
Comrade Kristinawrites: \tUhm BAC is 25% at 7.67 now...I'm guessing BAC gets to play Frazier today... Comrade Kristina | Homepage | 01.15.09 - 10:29 am | # ----- It has been a few weeks since I've seen a steady early morning decline in the S&P like today. Are we trying to go for a "V" or "L" or "U" pattern today?
House Democrats are calling for a stimulus plan of about $825 billion, containing spending and tax cuts, according to a House aide. The numbers are subject to change but include $550 billion in federal spending and $275 billion in tax cuts. Democrats reportedly will unveil the proposal later Thursday.
Funny how the Ratings agencies weren't fast enough to downgrade the crappy derivatives and are now apparently too quick to downgrade everything in sight.
OhBoy
Pending Federal investigations changes ones behavior fast
Rather than speaking out against the financial fraud and asymetrical bailouts, Buffett decided to seek profits from the biggest government giveaways in history.
Boo on Warren Buffett. Biggest grifter of them all.
It has been a few weeks since I've seen a steady early morning decline in the S&P like today. Are we trying to go for a "V" or "L" or "U" pattern today? yagij | 01.15.09 - 10:34 am | #
Barry Ritholz has some nice stuff on bear market bottoms relating to P/E ratios. Supports the basic idea that we'll see something in the 6 to 8 range. Remind me... what's the current ratio?
"There's a pretty active housing market [Las Vegas], it's simply at a lower-priced inventory," says Michael Feder, chief executive of Radar Logic. "And there are now bidding wars taking place over homes in foreclosure."...."A falling discount doesn't mean a price recovery is around the corner, but it does suggest a stabilizing market."
Is "" a circuit breaker? yagij | 01.15.09 - 10:39 am | #
Nope, that was Haloscan eating my backslash.
Circuit breaker would be fun. I'd really like to see the 850 early in the day, because I think the fireworks around the reopen after the halt would be the best popcorn movie of all time, between the knife catchers and the capitulators.
It has been a few weeks since I've seen a steady early morning decline in the S&P like today. Are we trying to go for a "V" or "L" or "U" pattern today? yagij | 01.15.09 - 10:34 am | #
Ahh the pleasures of the extended charset. I nominate µ as the shape of things to come.
Rob Dawg(Supercalifragilisticexpealodocious) writes: Ahh the pleasures of the extended charset. I nominate µ as the shape of things to come. Rob Dawg | Homepage | 01.15.09 - 10:45 am | # ----- If we are going to get fancy, I can probably think of a hanzi or kanji that would visually convey the pattern plus provide an adequate explanation, but Greek is fine too.
They all got caught long and now can't unload their contracts. Time to take delivery or dump the contracts at the market price (hint - prices will crash lower the minute they try and sell). Angry Saver | 01.15.09 - 10:30 am | #
So does this mean MS employees get their bonus 'in kind'? Everyone is going to need their own personal tanker truck.
Judging by how foreclosures looked in the town we used to live in, I would have thought the foreclosure rate jumped more than that from 07 to 08. But then again we used to live close to Modesto and Stockton. I think the house we sold last year is already valued close to -50% from it's peak.
Popeye writes:
Eric writes:
I thought you said you pulled your stops
Caught up. You're right. That was on Friday, the 9th as we neared the close the spx dropped to 888. I didn't want to be taken out by a downward spike, so, I pulled my stops. We didn't cross 885 that day, but all I did was switch from auto pilot to manual controls. Instead of being taken out automatically, I pulled the trigger myself on Monday"
Fascinating post....
who cares?! (or believes a word)
Howevr, what you could do is to
apologize to that poster (cannot remember who) that you called 'stupid" as he was calling for 810 target
Personally I am too busy trading to post
Jane I agree with you for the most part.
The whole mess has been caused by people in primarily 2 or 3 states either buying more than they could afford or just gambling they could make a living off equity extraction.
Essentially no down payments were made. The people were really renting and didn't know it.
Barry Ritholz has some nice stuff on bear market bottoms relating to P/E ratios. Supports the basic idea that we'll see something in the 6 to 8 range. Remind me... what's the current ratio?
Usually they're talking about multiples of "peak earnings" in the past cycle, rather than past year or projected next year earnings. In which case, with S&P peak (operating) earnings of $88, we're at a 9 multiple now. Doesn't look too scary, right?
Unfortunately for fundamentals bulls, almost $40 of that $88 was brought to you courtesy of our friends on Wall Street. And I think - when the smoke clears and the auditors are poring over the smoking ruins - that we'll all see that half, or more, of that $40 was pure fantasy.
Which brings "peak earnings" for the prior cycle to right around $70.
Now put a multiple in the 6-8 range on that - and you get an S&P 500 of, well, 500. Or thereabouts.
This rollercoaster isn't pulling into the station quite yet, methinks.
The whole mess has been caused by people in primarily 2 or 3 states either buying more than they could afford or just gambling they could make a living off equity extraction. Essentially no down payments were made. The people were really renting and didn't know it. farmer | 01.15.09 - 11:08 am | #
This problem is far more pervasive than how you have characterized it above.
Jamie also comments on one of the big questions of the day:
"I think we're speaking for lots of banks here people are out making loans," Dimon said in a conference call with investors. He said "loan demand is actually dropping dramatically," and that JPMorgan is "trying to follow the intent and spirit" of the government's Troubled Assets Relief Program."
Whocouldaknowde that people and companies would not want more loans in a low interest rate environment?
Maybe there is some sort of a virus going around affecting people's desire to borrow? Maybe there is a deleveraging virus?
Most of us employed in the financial industry are prohibited from short selling.
I think without that prohibition, a lot of individuals would have tried to hedge their bets. Instead, they mostly end up hoping their job/bonus/company doesn't vanish.
Those of you outside of the industry usually can short sell (with the frequent exception of your own company).
It would have been nice to be able to short competitors who you might have had a strong feeling they were going down. However, there probably would have been some sort of scandal along with it.
rocky
I should not have said "whole mess", but I do think the bulk of the housing mess was created in a few spots. That is not to say there are not problems else where but they are manageable or they are the results of a finacial meltdown resulting from slicing and dicing a gajillion mortgages originated in 2 or 3 states.
Those numbers are staggering, and I was one of them. I followed Cramer's advice (before he gave it), and deleveraged. AIG is trying to collect on my purchase money second, but I will fight it all the way thanks to legal insurance for such things. My credit score is already on the mend after taking a 190 point hit. The prices WILL NOT RETURN to such levels in CA in the next 30 years (just like the NASDAQ will not return to 5000). It sucks to be the millions of people who are paying on a house that's worth 1/2 of what they paid for it. Follow Cramer's advice and deleverage. Your children will thank you in 20 years. Don't drag it out longer than it needs to be. With any luck, we will return to small regional banking, less financing for purchases of automobiles, and a high savings rate (which China enjoys at our expense). Jobs will return to the US, and deflation will make everything more affordable, including paying people living wages. Look for the government/medical complex to pop next. MDs and drug companies and all health care professionals make WAY too much money.
Foreclosure filings were reported on more than 303,000 U.S. properties in December 2008, up 17 percent from the previous month and nearly 41 percent from December 2007. Foreclosure activity for the fourth quarter was down nearly 4 percent from the third quarter, but up nearly 40 percent from the fourth quarter of 2007.
Arizonas 2008 total of nearly 117,000 properties receiving foreclosure filings was third-highest among the states, trailing only Nevada and Florida. Foreclosure activity in Arizona increased by 203 percent from 2007 and 655 percent from 2006.
Rounding out the top 10 foreclosure rates for 2008 were, in order, California, Colorado, Michigan, Ohio, Georgia, Illinois and New Jersey.
farmer writes:
When Cramer says deleverage I hope he means get out of debt by paying down debt, not walking.
I work for a lender that still looks at the person. If you fixed your last problem by screwing the lender we ain't gonna talk to you.
farmer | 01.15.09 - 12:48 pm | #
No, he is literally calling for 8 million people who are underwater to walk away, particularly in favorable states such as California, were purchase money mortgages are protected from deficiency judgements (so I've been told by my lawyer).
In any case, if you work for a lender, I wouldn't want to talk to you. As far as I'm concerned, you're all crooks. You can take your unimpressive finance degrees and sick'em where it don't shine. Your kind ripped off millions for billions in fees.
Also, it's not that hard to work around lenders these days- I managed to. Anyhow, in 7-10 years, my credit score will be better than yours and my house will be paid off. People who held on for 10 years, 250k in interest later, will be begging people like me for a loan at 25% interest rate.
It's time to leave expensive areas and migrate to less-expensive places to ride out the coming Depression.
Get off your asses and call your Senators and Representatives to say NO ON THE TARP BILL, and NO ON ANY MORE BAILOUTS. They won't listen, but you will feel better knowing that you tried. They can only ignore the people so long before there's a revolution.
Bet the rules will be re-written before this hits the fan.
This may already have been asked in previous threads, but does anyone have an updated version of the Credit-Suisse mortgage reset chart? The original dates back to 2007, and may not reflect any number of variables that weren't known at the time:
Negative amortization hitting the maximum allowed LTV limit (typically 110-125%) and thereby triggering the recast to full amortization earlier than forecast.
Existing morgages that were converted from option-ARMs to FRMs, either voluntarily by the lender, or by government mandate.
Principal cram-downs and/or increased FHA/GSE loan limits, which converted mortgages previously counted as "Jumbo" or "Jumbo Alt-A" to "conforming/standard".
I suspect any one of the above could significantly skew the chart.
Back later
Any one want to be that we top 10 million in the next two years?
There is no end in sight ... I expect foreclosure activity in 2009 to be higher than 2008.
It seems every so-called remedy is failing. Halt foreclosures just delays the eventual foreclosure. Most of the modifications still lead to foreclosures.
The situations is snowballing.
So is the market going to ignore the loan loss provisions with JPM and JUST focus on the 'met expectations' aspect?
2 mins and we find out... tick tick tick
Go long on the door lock industry.
I'm aware of three parties that are "waiting" for a better "deal" on helping them through their foreclosure mess. The FedGov are the biggest ones to blame. Had they been the "regulators" of last resort, much would have been nipped in the bud.
AND they just got a PAY RAISE??
Any one want to be that we top 10 million in the next two years?
Robert | Homepage | 01.15.09 - 9:30 am | #
I don't like to feed my gambling habit but if it does go double digit there will be a bunch of other bad news that accompanies such as depression level unemployment, civil unrest, a shift in the populace from region to region searching out opportunity, less of an immigration 'problem', perhaps new political party...
Gotta take a nap now.
there is absolutely NOTHING that warrants FedGov workers getting a pay raise. Utter BullSh**!
there is absolutely NOTHING that warrants FedGov workers getting a pay raise. Utter BullSh**!
Black Star Ranch | 01.15.09 - 9:37 am | #
Wage inflation has to start somewhere to save us. Easiest to line your own pockets first!
Don't worry, it'll trickle down.
Don't worry, it'll trickle down.
Eric | 01.15.09 - 9:38 am | #
And gather in a pool all round your shoe.
....."in a pool all round your shoe."
NO KIDDING.
"Halt foreclosures just delays the eventual foreclosure. Most of the modifications still lead to foreclosures.
The situations is snowballing."
iceman | 01.15.09 - 9:32 am | #
Per someone at the local courthouse,the only thing keeping this semi under control is the courthouse can only process X number of FC's a day. After that they just get rolled to the next day.
Chris
Sorry for the OT and possible redundancy but anyone clued in on the Bernanke/Bair meet-up in Basel?
## And gather in a pool all round your shoe.
Comrade Volker the Viking | 01.15.09 - 9:39 am | #
Here in Chicago it'll be ice cubes before it gets that far.
Wow! BAC down 15% to $8.65
When is everyone going to face the fact that most of these foreclosures are people who never wanted a house or a home? A huge percentage of recent buyers simply wanted to make a lot of money very fast.
Cobra,
Per someone at the local courthouse,the only thing keeping this semi under control is the courthouse can only process X number of FC's a day. After that they just get rolled to the next day."
Well that stuff is rolling in faster than it's rolling out...It's gonna leave an awful stench.
Nostrovia,
Popeye, how's that rock solid line in the sand of 885 holding up ?
Perhaps we need to encourage more lending.
jane in los angeles,
When is everyone going to face the fact that most of these foreclosures are people who never wanted a house or a home? A huge percentage of recent buyers simply wanted to make a lot of money very fast."
Given your first name I'm reminded of point counter point on SNL with Dan Akroid and Jane Curtain...But I will leave Dan's famous opening rebuttal line unsaid.
That said, please tell that to all of the families now and in the recent past who have packed up and moved out. There were specs...but hardly a majority...You better have some good evidence to support that claim.
Nostrovia,
Just the families that I know who bought in 05 and 06. They are walking now.
I am only guessing that they are not the only ones.
Jane, the I.S.
Everything points to a retest of the previous lows. Credit still stuck to the hubs, BAC is a single digit midget, C is under $5.00, Regions is under $7.00, other regional banks prolly headed south too.
YouTube - the new sheriff scene from blazing saddles
Anyone taken a peek at C lately?
The obvious answer to this is to continue to erect inferior new homes. It reminds me of my father when we were growing up. He would be choking to death at the table but still piling food in his mouth. It was insane, bere he is, he can't breath, he's choking, but he continues to feed himself the very thing that's causintg himself toi suffocate. He's still living, though. And, none of us knew the Heimlich at that time. He would have been toast if he couldn't have dislogded it on his own.
"Well that stuff is rolling in faster than it's rolling out...It's gonna leave an awful stench.
Nostrovia,"
Comrade Misean is Dope | Homepage |
Misean,
How bad is getting here in Florida ya ask...Per the census we have 98k "Housing units" in Charlotte County. I just looked at a graph from the Sarasota paper and it looks like just in 2008 ONLY there were 6100 foreclosures. This is rough because they broke it into months on the graph. But still 6% of the housing is in foreclosure in one year???? I am just gonna crawl under my desk and hide...
Chris
Well that stuff is rolling in faster than it's rolling out...It's gonna leave an awful stench.
Comrade Misean is Dope | Homepage | 01.15.09 - 9:47 am | #
Don't you mean "streaming in" and "trickling out"?
Buffet soulda bought BAC too while he was out there pickin' winnas. What a dinosaur.
The continued increase in foreclosures is actually the only sane thing happening right now (BAC bailout, not so much). Recovery requires requires market-clearing prices. The sooner foreclosures drive us there, the better.
Can't happen fast enough in SoCal. Too many people still holding out for ridiculous prices.
It's a great time to foreclose or foreclose a home !
There is no end in sight ... I expect foreclosure activity in 2009 to be higher than 2008.
And then the option-arms reset !
Caught this, interesting stuff:
Michigan bank turns profit through Islamic financing - MontereyHerald.com :
....South Florida foreclosures are under reported by a 100%, for every one reported there is another that is not reported by statistical manipulation....no property taxes being paid, public safety budgets cut, etc.....unless there is some financial miracle . . . .
C dying in front of your eyes. Like going to the ICU and watching the monitors get quieter and quieter...,
Minus the pathos.
And then the option-arms reset !
Bet the rules will be re-written before this hits the fan.
C dying in front of your eyes. Like going to the ICU and watching the monitors get quieter and quieter...,
We're going to have to revise some of the old advertising slogans:
For C: The Citi Sleeps With the Fishes
For BAC/CFC: Countrywide is a Thorn in Your Side
404 Page not found
LONDON, Jan 15 (Reuters) - Societe Generale said on Thursday that the United States' economy looks likely to enter a depression and China's could implode.
In a highly bearish note, veteran cross asset strategist Albert Edwards said investors should now cut equity exposure after a turn-of-the-year rally and prepare for a rout.
He predicted that the S&P 500 index of U.S. stocks could be set for a fall of nearly 70 percent from recent levels.
Edwards also raised the danger of a global trade war with China.
bearly writes:
Popeye, how's that rock solid line in the sand of 885 holding up ?
Sorry, I'm about 30 minutes behind in the comments. Bearly, that is the place where I put my stops on that trade. I honored the stops and took the loss when we crossed it.
Critique of foreclosure reportings:
Foreclosure Filings Rose 81% in 2008 « naked capitalism
I honored the stops and took the loss when we crossed it.
Popeye | 01.15.09 - 10:18 am | #
I thought you said you pulled your stops.
C + F < 6
Unless you are Richard Pryor in Superman III, this is impossible to solve !
with Geithner in limbo and Paulson an employment statistic come Tuesday who will co-sign the bailout II checks for C and BAC?
and this just in JPM just downgraded by Moodys
this is truly gambling!!
got out of faz at 62 and hopefully into BAC at 7.50
Popeye | 01.15.09 - 10:18 am | #
And you have been pretty damn good about all the needling folks seem obligated to provide...those damn martinis!
and this just in JPM just downgraded by Moodys
Sciurus
Evidently JPM didn't pay Moodys enough for their services. Another error in judgement by JPM.
got out of faz at 62 and hopefully into BAC at 7.50
wheres olive | 01.15.09 - 10:23 am | #
Why not back in to FAS ?
These two have 300% gains on a monthly basis.
This is unreal, they are still gambling!!!
Morgan Stanley Said to Seek Supertanker to Store Oil
Morgan Stanley Said to Seek Supertanker to Store Oil (Update2) - Bloomberg.com
Morgan Stanley is seeking a supertanker to store crude oil, joining Citigroup Inc. and Royal Dutch Shell Plc in trying to profit from higher prices later in the year, four shipbrokers said.
This is unreal, they are still gambling!!!
That's probably the only thing that isn't gambling.
Unless they park them tankers near some pirates.
I know some Somali pirates who have a spare supertanker for sale.
Good thing Hillary won't have to run around trying to save all those NYC jobs.
I know some Somali pirates who have a spare supertanker for sale.
JS | 01.15.09 - 10:26 am | #
5 out of 8 drowned trying to get the ransom.
A moment of silence please.
Citi is melting down (trading below $3.50/share).
Looks like that #300 billion in government guarantees might eat up the rest of the TARP.
Looks like Paulson's split strike strategy isn't working.
We need a bigger bazooka - print!
I know some Somali pirates who have a spare supertanker for sale.
Do they work for the Ratings and insurance agencies?
Eric writes:
I thought you said you pulled your stops
Caught up. You're right. That was on Friday, the 9th as we neared the close the spx dropped to 888. I didn't want to be taken out by a downward spike, so, I pulled my stops. We didn't cross 885 that day, but all I did was switch from auto pilot to manual controls. Instead of being taken out automatically, I pulled the trigger myself on Monday.
MaurS writes:
\tWow! BAC down 15% to $8.65
MaurS | 01.15.09 - 9:45 am | #
-----
Down goes Frazier?
Also, with C's share price being less than GM's share price, who the !#*)%!# is "Frazier" this morning?
Who pays for clean up if one of those super tankers spills oil?
US tax payer.
"I expect forclosure activity in 2009 to be higher than 2008"
wow CR, pretty risky prognostication! : )
we are all Frazier...
Uhm BAC is 25% at 7.67 now...I'm guessing BAC gets to play Frazier today...
Morgan Stanley is seeking a supertanker to store crude oil, joining Citigroup Inc. and Royal Dutch Shell Plc in trying to profit from higher prices later in the year, four shipbrokers said.
Nonsense.
They all got caught long and now can't unload their contracts. Time to take delivery or dump the contracts at the market price (hint - prices will crash lower the minute they try and sell).
Suckers.
Here in Metropolitan New York prices have yet to really fall (maybe -10% after a run-up of at least 200%) but sales have come to a standstill, over a year and a half of inventory (yes, cause and effect) When do people here think the big bust will happen?
Is that FBAC? Man, that is going to be a lot of pizza...
Funny how the Ratings agencies weren't fast enough to downgrade the crappy derivatives and are now apparently too quick to downgrade everything in sight.
This is rich!
http://finance.yahoo.com/real-estate/article/106439/Where-U.S.-Home-Sales-Are-Rising
Eh..worse in 2009 than 2008, don't let Barney know. Aside, if C goes to two bucks fifty it'll be one of those weekends.
Societe Generale said on Thursday that the United States' economy looks likely to enter a depression and China's could implode.
In a highly bearish note, veteran cross asset strategist Albert Edwards said investors should now cut equity exposure after a turn-of-the-year rally and prepare for a rout.
He predicted...
OK, but what does Jerome Kerviel think?
Dow back below 8k ?
Comrade Kristinawrites:
\tUhm BAC is 25% at 7.67 now...I'm guessing BAC gets to play Frazier today...
Comrade Kristina | Homepage | 01.15.09 - 10:29 am | #
-----
It has been a few weeks since I've seen a steady early morning decline in the S&P like today. Are we trying to go for a "V" or "L" or "U" pattern today?
House Democrats are calling for a stimulus plan of about $825 billion, containing spending and tax cuts, according to a House aide. The numbers are subject to change but include $550 billion in federal spending and $275 billion in tax cuts. Democrats reportedly will unveil the proposal later Thursday.
Funny how the Ratings agencies weren't fast enough to downgrade the crappy derivatives and are now apparently too quick to downgrade everything in sight.
OhBoy
Pending Federal investigations changes ones behavior fast
I've lost all respect for Buffett.
Rather than speaking out against the financial fraud and asymetrical bailouts, Buffett decided to seek profits from the biggest government giveaways in history.
Boo on Warren Buffett. Biggest grifter of them all.
It has been a few weeks since I've seen a steady early morning decline in the S&P like today. Are we trying to go for a "V" or "L" or "U" pattern today?
yagij | 01.15.09 - 10:34 am | #
You left off "I"
Uhm BAC is 25% at 7.67 now...
Unreal. I thought it was a buy at 11. Whoa.
Barry Ritholz has some nice stuff on bear market bottoms relating to P/E ratios. Supports the basic idea that we'll see something in the 6 to 8 range. Remind me... what's the current ratio?
RockyRwrites:
\tYou left off "I"
RockyR | 01.15.09 - 10:34 am | #
-----
Umm... Yeah...
::runs to hide under his desk::
When do people here think the big bust will happen?
It will come. Be patient.
Eventually the government will have to stop the bankers from writing themselves bonuses.
I remember NYC in the 1970s. Really scary place.
Rocky, you stole my answer
Are we trying to go for a "V" or "L" or "U" pattern today?
yagij | 01.15.09 - 10:34 am | #
Hoping for a ""
Sigh. Time to ban short selling again...
"There's a pretty active housing market [Las Vegas], it's simply at a lower-priced inventory," says Michael Feder, chief executive of Radar Logic. "And there are now bidding wars taking place over homes in foreclosure."...."A falling discount doesn't mean a price recovery is around the corner, but it does suggest a stabilizing market."
....first in, first out. Many older home buyers.
A moment of silence please.
Interesting Times | 01.15.09 - 10:27 am | #
Arrrrgle...glargle...glug....
More like time to watch the parade. Bleachers available cliff side. Comestibles available. Enjoy.
Eric writes:
Hoping for a ""
Eric | 01.15.09 - 10:38 am | #
-----
Is "" a circuit breaker?
I agree - short sellers are the ones creating all of Citi's problems.. and now Bank of America..
damn them!
Oh.. wait a minute.. I'm short the financials..
nevermind.
Is "" a circuit breaker?
yagij | 01.15.09 - 10:39 am | #
Nope, that was Haloscan eating my backslash.
Circuit breaker would be fun. I'd really like to see the 850 early in the day, because I think the fireworks around the reopen after the halt would be the best popcorn movie of all time, between the knife catchers and the capitulators.
Obama should offer to store the oil in the SPR for half of whatever the supertanker would cost to rent.
"Can't happen fast enough in SoCal. Too many people still holding out for ridiculous prices.
Comrade Bear (tj & the bear) "
True in Manhattan too, but the inventory continues to build.
It has been a few weeks since I've seen a steady early morning decline in the S&P like today. Are we trying to go for a "V" or "L" or "U" pattern today?
yagij | 01.15.09 - 10:34 am | #
Ahh the pleasures of the extended charset. I nominate µ as the shape of things to come.
Can't happen fast enough in SoCal. Too many people still holding out for ridiculous prices.
Comrade Bear (tj & the bear)
Soon selling your house will feel like winning a lottery. Except you lose all your 'equity'.
I nominate µ as the shape of things to come.
Rob Dawg | Homepage | 01.15.09 - 10:45 am | #
I can't quite see that character with my version of FF... is that MU? hehehe
Good to see you back Dawg.
Rob Dawg(Supercalifragilisticexpealodocious) writes:
Ahh the pleasures of the extended charset. I nominate µ as the shape of things to come.
Rob Dawg | Homepage | 01.15.09 - 10:45 am | #
-----
If we are going to get fancy, I can probably think of a hanzi or kanji that would visually convey the pattern plus provide an adequate explanation, but Greek is fine too.
OT, but worth noting that not all the retailers are suffering just yet.
Big Box Retailers Seeing Strong Spending -- Seeking Alpha
I nominate µ as the shape of things to come.
I'm going with a L--
Will we see the 7's in the DOW today?
Meanwhile the dollar is two-ply and gaining strength..
Will we see the 7's in the DOW today?
adornosghost | 01.15.09 - 10:51 am | #
Since Timmy's busy with his 1040s and white-out, yeah, we might.
Nonsense.
They all got caught long and now can't unload their contracts. Time to take delivery or dump the contracts at the market price (hint - prices will crash lower the minute they try and sell).
Angry Saver | 01.15.09 - 10:30 am | #
So does this mean MS employees get their bonus 'in kind'? Everyone is going to need their own personal tanker truck.
Aside, if C goes to two bucks fifty it'll be one of those weekends.
barkingtribe | 01.15.09 - 10:31 am | #
Has FFDIC had any comment on Citi?
Judging by how foreclosures looked in the town we used to live in, I would have thought the foreclosure rate jumped more than that from 07 to 08. But then again we used to live close to Modesto and Stockton. I think the house we sold last year is already valued close to -50% from it's peak.
We are all Frazier now.
timmy to merge C & BAC, new symbol=CACA
Popeye writes:
Eric writes:
I thought you said you pulled your stops
Caught up. You're right. That was on Friday, the 9th as we neared the close the spx dropped to 888. I didn't want to be taken out by a downward spike, so, I pulled my stops. We didn't cross 885 that day, but all I did was switch from auto pilot to manual controls. Instead of being taken out automatically, I pulled the trigger myself on Monday"
Fascinating post....
who cares?! (or believes a word)
Howevr, what you could do is to
apologize to that poster (cannot remember who) that you called 'stupid" as he was calling for 810 target
Personally I am too busy trading to post
Damn it, energycon! I knew when I wrote that it I should probably scan the rest of the comments first!
Anonymous,
I thought my two prior apologies would suffice, but, if another is called for, then, I aplogize again.
Fascinating post....
who cares?! (or believes a word)
Anonymous | 01.15.09 - 10:57 am | #
So block him, if you're so busy.
only green I have on my longs watch list is MO....
hmmm self reminder-buy 50 cartons for barter...
LOL!
ew thread
Jane I agree with you for the most part.
The whole mess has been caused by people in primarily 2 or 3 states either buying more than they could afford or just gambling they could make a living off equity extraction.
Essentially no down payments were made. The people were really renting and didn't know it.
Barry Ritholz has some nice stuff on bear market bottoms relating to P/E ratios. Supports the basic idea that we'll see something in the 6 to 8 range. Remind me... what's the current ratio?
Usually they're talking about multiples of "peak earnings" in the past cycle, rather than past year or projected next year earnings. In which case, with S&P peak (operating) earnings of $88, we're at a 9 multiple now. Doesn't look too scary, right?
Unfortunately for fundamentals bulls, almost $40 of that $88 was brought to you courtesy of our friends on Wall Street. And I think - when the smoke clears and the auditors are poring over the smoking ruins - that we'll all see that half, or more, of that $40 was pure fantasy.
Which brings "peak earnings" for the prior cycle to right around $70.
Now put a multiple in the 6-8 range on that - and you get an S&P 500 of, well, 500. Or thereabouts.
This rollercoaster isn't pulling into the station quite yet, methinks.
The whole mess has been caused by people in primarily 2 or 3 states either buying more than they could afford or just gambling they could make a living off equity extraction.
Essentially no down payments were made. The people were really renting and didn't know it.
farmer | 01.15.09 - 11:08 am | #
This problem is far more pervasive than how you have characterized it above.
Jamie also comments on one of the big questions of the day:
"I think we're speaking for lots of banks here people are out making loans," Dimon said in a conference call with investors. He said "loan demand is actually dropping dramatically," and that JPMorgan is "trying to follow the intent and spirit" of the government's Troubled Assets Relief Program."
Whocouldaknowde that people and companies would not want more loans in a low interest rate environment?
Maybe there is some sort of a virus going around affecting people's desire to borrow? Maybe there is a deleveraging virus?
Most of us employed in the financial industry are prohibited from short selling.
I think without that prohibition, a lot of individuals would have tried to hedge their bets. Instead, they mostly end up hoping their job/bonus/company doesn't vanish.
Those of you outside of the industry usually can short sell (with the frequent exception of your own company).
It would have been nice to be able to short competitors who you might have had a strong feeling they were going down. However, there probably would have been some sort of scandal along with it.
rocky
I should not have said "whole mess", but I do think the bulk of the housing mess was created in a few spots. That is not to say there are not problems else where but they are manageable or they are the results of a finacial meltdown resulting from slicing and dicing a gajillion mortgages originated in 2 or 3 states.
Those numbers are staggering, and I was one of them. I followed Cramer's advice (before he gave it), and deleveraged. AIG is trying to collect on my purchase money second, but I will fight it all the way thanks to legal insurance for such things. My credit score is already on the mend after taking a 190 point hit. The prices WILL NOT RETURN to such levels in CA in the next 30 years (just like the NASDAQ will not return to 5000). It sucks to be the millions of people who are paying on a house that's worth 1/2 of what they paid for it. Follow Cramer's advice and deleverage. Your children will thank you in 20 years. Don't drag it out longer than it needs to be. With any luck, we will return to small regional banking, less financing for purchases of automobiles, and a high savings rate (which China enjoys at our expense). Jobs will return to the US, and deflation will make everything more affordable, including paying people living wages. Look for the government/medical complex to pop next. MDs and drug companies and all health care professionals make WAY too much money.
Foreclosure filings were reported on more than 303,000 U.S. properties in December 2008, up 17 percent from the previous month and nearly 41 percent from December 2007. Foreclosure activity for the fourth quarter was down nearly 4 percent from the third quarter, but up nearly 40 percent from the fourth quarter of 2007.
Arizonas 2008 total of nearly 117,000 properties receiving foreclosure filings was third-highest among the states, trailing only Nevada and Florida. Foreclosure activity in Arizona increased by 203 percent from 2007 and 655 percent from 2006.
Rounding out the top 10 foreclosure rates for 2008 were, in order, California, Colorado, Michigan, Ohio, Georgia, Illinois and New Jersey.
When Cramer says deleverage I hope he means get out of debt by paying down debt, not walking.
I work for a lender that still looks at the person. If you fixed your last problem by screwing the lender we ain't gonna talk to you.
So does this mean MS employees get their bonus 'in kind'? Everyone is going to need their own personal tanker truck.
Sweet. This is great news for the trucking index.
farmer writes:
When Cramer says deleverage I hope he means get out of debt by paying down debt, not walking.
I work for a lender that still looks at the person. If you fixed your last problem by screwing the lender we ain't gonna talk to you.
farmer | 01.15.09 - 12:48 pm | #
No, he is literally calling for 8 million people who are underwater to walk away, particularly in favorable states such as California, were purchase money mortgages are protected from deficiency judgements (so I've been told by my lawyer).
In any case, if you work for a lender, I wouldn't want to talk to you. As far as I'm concerned, you're all crooks. You can take your unimpressive finance degrees and sick'em where it don't shine. Your kind ripped off millions for billions in fees.
Also, it's not that hard to work around lenders these days- I managed to. Anyhow, in 7-10 years, my credit score will be better than yours and my house will be paid off. People who held on for 10 years, 250k in interest later, will be begging people like me for a loan at 25% interest rate.
It's time to leave expensive areas and migrate to less-expensive places to ride out the coming Depression.
Get off your asses and call your Senators and Representatives to say NO ON THE TARP BILL, and NO ON ANY MORE BAILOUTS. They won't listen, but you will feel better knowing that you tried. They can only ignore the people so long before there's a revolution.
OhBoy writes:
And then the option-arms reset !
Bet the rules will be re-written before this hits the fan.
This may already have been asked in previous threads, but does anyone have an updated version of the Credit-Suisse mortgage reset chart? The original dates back to 2007, and may not reflect any number of variables that weren't known at the time:
I suspect any one of the above could significantly skew the chart.
Tanta might have enjoyed this:
Hitler gets forclosed on.
A redo of an old redo, but funny. Try to watch until the end.
Nothing found for Public Department61 Cfm
81% increase is nonsense. My first reaction is to ask RealtyTrac to "prove it".
Why is there a 43% increase in filings, but an 81% increase in properties?
I suspect it has much more to do with the way they collect the data than it does with reality.