market bottoms: the new market tops...

I'm not convinced we see the bottom in housing starts/permits/etc. We are entering into the end of a great many CRE lines of credit. We all suspect those lines have been cash burned and not invested in RE asset construction. There is massive contraction in construction lending. Even projects that make sense are not going to be built because of credit/financing issues. As long as foreclosures depress all prices new housing makes little sense until more deflation lowers construction costs and that's only if lending costs don't skyrocket.

"Why are people calling a bottom for Real Estate?"

Cause, it ain't over until falling prices are over. The Admin can green shoot all they want, but as long as the underlying assets for all of the securities and derivative products continue to fall, the banks are still broke.

Unless of course, they have a direct IV to the Treasury, like GS.

There can be no bottom until unemployment bottoms. No job, no credit, no cash...no bottom.

Waiting for the "second coming" of real estate?

All I can say is another sharp decline in housing stats and we'll see capitulation, or worse, across the entire economy.

So let's truly hope CR is correct in this.

OT, and not relevant to this subject thread, however, I felt it was another reason that the US start re-regulating goods manufactured over seas, out sourced...

From Asian Times Online, China's games played with US out-scourers----

Snip/
"Despite that approach, China for nearly a decade has been phenomenally attractive to importers, particularly Americans. Even though other countries can undersell it, China remains the top choice for contract manufacturing. China has better infrastructure and internal stability than low-cost producers such as Vietnam or India, so shipping channels are more reliable. It has a wide range of manufacturers, eager to make anything importers want, offering the equivalent of "no money down
" deals, driven by the mantra, "All we need is your sample". "
snip/
"Midler points how these games can turn dangerous. At King Chemical, poor factory oversight and lax employee discipline put people with skin infections on the production line, risking product contamination. Factories slap on quality-control stickers but they're meaningless. Midler laughs at "No Animal Testing" labels on Johnson Carter products - because there's no testing at all. Laboratories can only check for a specific substance in each costly test, and there's no limit to the harmful substances that might have been introduced to a product, either accidentally or by changes to the product formula without the importer's knowledge, so most importers just cross their fingers. While working with Johnson Carter, Midler became so paranoid that he stopped using soap."

Asia Times Online :: China News, China Business News, Taiwan and Hong Kong
News and Business.

Lucifer (profile) wrote on Sat, 7/18/2009 - 2:46 pm

Why would people not believe in second comings of other messiahs?

If Jesus returns as a Realtor, I'm becoming an atheist.

I'd like to make a small distinction - many of those returning to Mexico, Central and South America were properly registered immigrants who worked here quite legally. But perhaps I'm too sensitive on the matter of lumping all into the descriptive 'illegals'.

edit: s.i.g.: you clearly make that distinction, but you're more or less solo there.

Along the lines of what Rob said, there are many markets where replacement cost substantially exceeds the cost of an existing home. In that situation, new SFH building only occurs for a handful of people who want a custom home, and can finance it. I think we are already there for most of the greenfield development areas around Phoenix.

As prices continue to go down, the number of markets where new home building makes no economic sense will increase. And the places where new home building makes economic sense are for infill in crowded areas - generally not where the national homebuilders are most competitive, except possibly for condo towers. With all due respect to anyone considering it, only an idiot would buy a condo in this economy. Chances of the association going bust and leaving you with a negative resale value are just too high.

So I guess it's possible that SFH starts bottomed in January 09, but I think we will remain close enough to the bottom that January of any given year for at least the next five years could go lower than 09.

"Creation of new households. "

This is why my boomer meme, obnoxious as it may be, is utterly on-topic most of the time.

Underemployed 60-year-olds may start a new family, but it isn't the likeliest thing in the world.

Underemployed 60-year-olds may start a new family, but it isn't the likeliest thing in the world.

I don't know, HH.
I got a lot of 25yo coeds chasing me around.

I suspect that once the Chinese have completely penetrated America's market with defective goods, there will able a demand to re-institute standards that are enforced on the the American retailers...

It may be that China, India and Vietnam, the lowest cost manufacturer's goods will be inspected before/prior to hitting the store shelves. What the heck, we send them our toxic expendable computer castaways that pollute/poison their popluation who are surviving on the crumbs dropping off the table of their elites...

See Frontline's .."Ghana's Digital Dumping Ground"

"On the outskirts of Ghana's biggest city sits a smoldering wasteland, a slum carved into the banks of the Korle Lagoon, one of the most polluted bodies of water on earth. The locals call it Sodom and Gomorrah."

FRONTLINE/World Ghana: Digital Dumping Ground | PBS

The economy is the least of your worries...you should be worrying about your health and your children, if we will be meeting the third world on our way down...

Glendale is in between, probably right around 2000.

We bought in Dec.
Man, that's just unreal, to think I'd be underwater after nine years.

"A serious question: is calling a bottom in RE actually important or material in the current crisis?"

Yes, Counterpointer, it is. If there actually is a bottom in RE and people realize it at about the time it occurs, there will be fewer discretionary defaults. People who were thinking of buying a house would also be more interested. Their concerns about their downpayment vaporizing due to depreciation would be lower, and their hope/estimate of future appreciation would be higher.

On the other hand, if real estate prices actually turned around and it took 6-12 months to be discovered or believed, more owners would default, and more potential buyers would wait.

To give an example of why a delay might happen, Case Shiller data is currently available for April 2009. Homes closed in April mostly had an offer accepted in February or March. The people buying in Feb or March probably started looking seriously a few months earlier. It's pretty easy to have a 4-6 month delay between a market turning and confirmation from a careful index like CS. Median price data is pretty meaningless when the mix is shifting, even if reported earlier.

Take a name:

Yes, and you're right as well. The picture isn't one of virtue punished by any means and, whether or not CIT was once a strong presence in small business finance, I expect our Alabama hardware distributor will have plenty of unreported company.

CR, nice plug in WSJ last week. If I needed pretty graphics that didn't portray the truth, I can find that in popular media.

Seeing a bottom in costs as excess inventory was burned off in the early spring and now new construction has to rely on new materials manufactured/logged, etc. as well as trades who can no longer "buy" a job but have to cover costs. It was an interesting 6 month dip. Problem is many manufacturers already cut/closed/mothballed facilities so production times are now a problem in some areas.

Good news? You gotta be kidding me CR. The recovery of housing starts is desperation. Builders have to keep building to stay in business. We don't need one new home until the shadow inventory is gone. What will happen when the foreclosure moratorium in CA lifts? Without a recovery in employment what are people going to do with the new homes? I guess people will be buying new homes and the old ones will be bulldozed. That would be a surefire way to show an increase in the GDP.

Interesting comments, thanks. It's just that I heard a gaggle of people talking RE at a bbq recently and after 10 minutes had to chuck in a flip remark along the lines of "well, you could just treat it like a house and live in it". Glares all round. Some obvious pulsing at temples.

Went to talk to some dudes about EM debt instead.

C

"Went to talk to some dudes about EM debt instead. "

and what was the consensus on that?

EMB: Basic Chart for ISHARES JP MORGAN - Yahoo! Finance

My take would be that starts count little in a recovery call unless the numbers are ver large.

Re: Harry Dent / demographics suggests that we'll have a flat period for 1-2 years and then the true bottom around 2011-2012.

I can't even believe that my house in Phoenix is probably worth less now than what i paid in 2000.

The question in my mind is that if you have a job and expect to have one, can live there comfortably and prefer it to renting, can afford the payments, and are not massively underwater, what is your worry? It sounds like you think of the house as an asset in which you invested for some appreciation not just a place to live comfortably and affordably.

zerohedge has the funniest southpark- investing with the bank of GS-
Zero Hedge: Modern Banking Explained Or The Importance Of Saving Money
Someday this war's gonna end...

Broward - You probably wouldn't quite be underwater yet. You'd have paid down a little bit of principal, and prices weren't moving all that fast in 2000, so going back another year is only a few thousand dollars.

The thing about the remote exurbs is, they leaped from early 21st century prices (~200K) to mid 20th century prices (~35K) in about a year.

Maricopa, Queen Creek and Anthem (exberbs of Phx metro) have seen drops in value from $350,000.00 to $100,000.00. Sometimes less if you buy several at a time.

Even if you are still even in value, put money down and bought 10 yrs ago, it is hard to think about all that money paid for no current value. We just aren't used to thinking like that for a home. A car yes, a home no. In additon, if you are close to retirement and planned on moving to a smaller (probablly less expensive) place or another location - forget it.

... seems nobody wants to be wrong this time around about predicting recovery or V or U or L or W or whatever... sometimes the future is pretty predictable... especially when massive debt still has to be unwound. at best, no rebound for at least a decade ... unless we get back to a miracle recovery, and U3 back to around 4-5% by 2012.... does anybody really believe that? more pain seems likely.

is mello-roos also found in ventura? thought that was just an OC thing.

Here is why there is a bottom. Banks are going under at a faster rate and foreclosures are increasing, thus logic tells some people that the bottom is near, versus the reality that deflation is going to kick ass this Swine Flu Season:

A foreclosure filing every 13 seconds
A foreclosure filing every 13 seconds - Boston Real Estate - Boston.com
That comes atop a new report by the Mortgage Bankers Association that a stunning 12 percent of all mortgages are now delinquent.
By the end of 2012, we are looking at a total of 9 million more foreclosure filings.

Cheers

" burnside (profile) wrote on Sat, 7/18/2009 - 4:12 pm

I'd like to make a small distinction - many of those returning to Mexico, Central and South America were properly registered immigrants who worked here quite legally. But perhaps I'm too sensitive on the matter of lumping all into the descriptive 'illegals'.

edit: s.i.g.: you clearly make that distinction, but you're more or less solo there."

But you're not too sensitive to categorize all but one, more or less, of those who oppose illegal immigration as illiterate and/or racist.
You're willing to do this because you've made a generalization about what "kind" of people those are, and know that they're fair game for ridicule, here or anywhere.

"
josap (profile) wrote on Sat, 7/18/2009 - 4:40 pm

Maricopa, Queen Creek and Anthem (exberbs of Phx metro) have seen drops in value from $350,000.00 to $100,000.00. Sometimes less if you buy several at a time."

I made the acquaintance of a woman from "The Valley" on a business trip a couple of weeks ago whose profession was real estate. The "multiple sales" to which you refer was what she was seeing the most of. There's a lot of that going on in Vegas which was where she was returning from. Speculators/Knife Catchers; I suspect they're performing the same function as speculators and short sellers in other markets by providing liquidity, but at what appears at the time to be a substantial premium.

OT:

I just realized that I am a Luddite-1975....

Maybe I am ahead of the curve,...He who is last, maybe first........

Being on the margin your whole life, may actually be beneficial in the future (Today)

" Doc Holiday (profile) wrote on Sat, 7/18/2009 - 4:48 pm

Here is why there is a bottom."

Just because we're accelerating towards the bottom is doesn't mean we've reached it; the question is "How far do we have to fall?"

mello-roos?

Newbie, in fact, I don't speak to illegal immigration at all.

You presume too much.

edit: that is, you presume a great number of things about me with no sound basis that I can see, among them that I presume a great number of things about others with no basis.

Citizen Allen,

Yah, stimulus directed at the problem, that would be weird and illogical. Instead of lower mortgage rates across the board, like a Universal Mortgage Cram Down -- where all homeowners, who were connected to The Bush Ownership Society -- all get reduced rates, which would increase savings capabilities for all homeowners and slow foreclosures .... no, Obama wants to push an Education Bubble and shift The Ownership burden over to the left and give everyone access to retraining, training for jobs that aint there. Thus we have The home Ownership problem unsolved and go forward to create the next debt burden with education and in the meantime, everyone has more debt and there will be fewer jobs. I just lost my lunch...

Well, I've finally caught that elusive knife. Found a nice place "back home", getting out of this hellhole they call NoVA. I realize it may end up losing some value, but I figure worst case scenario I'll just kiss my ill-gotten gains from the house I sold in 2006 goodbye. 4300 sq. ft., 3 car garage, well maintained, fully landscaped, and built long enough ago that you can sense a tangible difference in build quality vs. the 2004-2009 built crap shacks.

Mortgage payment will be 3-500 less per month than a comparable property would rent for, so I can't complain too much. And since I've been renting for the last 3 years I get my $8k Obama bucks, too.

THAT'S why I'm calling a bottom for real estate.

" lower mortgage rates across the board, like a Universal Mortgage Cram Down -- where all homeowners, who were connected to The Bush Ownership Society -- all get reduced rates, "

Hmmmm.... why are people who live in owned homes (which are generally considered better quality than rentals, and just a preferable living arrangement overall) entitled to preferential govt handouts? Why not instead give $200,000 cash to each renter?

"Mortgage payment will be 3-500 less per month than a comparable property would rent for"

once we see that in coastal markets AND rents stop slipping, we'll be at a bottom in coastal markets.

the second part of that one is the kicker in terms of timeframe.

I bought mid-2002 in Tempe. I think I'm still 50% over my initial purchase price. Rents in my development seem to have gone down, and will probably go down further once the high-rise condos come online. Not good for people who were expecting to make money renting to ASU college studnets.

My realtor(who I trust, believe it or not) has sent me info showing prices have bottomed and are starting to rise. Who knows if it's the same mix though.

Re: Why not instead give $200,000 cash to each renter?

Because Homeowners have "longer" contracts. I feel a new bumper sticker: Homeowners Do It Longer

Rob, prop 13 has saved my extended family over a million bucks. My point is the absurdity of it. And those granny/newlywed 1-20 ratios most certainly exist in SF, west LA, etc.

RC royalty is the sweetest deal possible. I have a good friend who doesn't like the noise of his 'hood, but the RC deal is almost a grand under market, so he's not moving. The best of all worlds.

You'll find plenty of 1-20 neighboorhoods in places with a view of the golden gate (laurel heights, marina, etc). Think DiFi's neighbors.

I never saw our house as an asset, I saw it as a potential liability. I was anticipating the crash for several years.

"Re: Why not instead give $200,000 cash to each renter?
Because Homeowners have "longer" contracts. I feel a new bumper sticker: Homeowners Do It Longer"

Huh? I wasn't serious in my proposal, but it does make just as much sense as giving homeowners loan mods. What is your argument against my proposal? "Longer contracts" isn't enough for me to pick up your meaning.

Urban Outfitters Inc., the clothing and housewares retailer, may consider providing short-term financing to some of its vendors should CIT Group Inc. collapse.

Urban Outfitters Says It May Mull Lending to Vendors (Update1) - Bloomberg.com

patientrenter,

The only point I would make (before my bike ride) is that a renter per say would not be entitled to any entitlement, because the landlord is the person that took on the risk and obligation with down payments and stuff like that. I guess this is why banks think they need bailed out, which brings up the domino theory, because there is a series of people involved in this cascading systemic implosion. It does seem like Treasury and most government-based entities are looking at this more in terms of banks who need help, versus the reality that there are a wide spectrum of people that have been impacted. Nonetheless, this all goes back to a lack of regulation, fraud and banks that took on too much risk by failing to manage the loans they took on.

On that bitching note, I'm off to The Discovery Trail

allen

Dey took r' jobz!

UE in the UK peaked around 3.3 mil in '84... I think they've passed that mark by a significant margin already. Did CR do a post about Northern Rock when it happened? That was almost a good year before Lehman...

"So why isn't a $200K cash handout to renters a worthy replacement for all the loan mods? "

because Jamie Dimon prefers a nation of debt slaves. duh.

"So why isn't a $200K cash handout to renters a worthy replacement for all the loan mods? "

I'd say both are a bad idea.

What is the point in giving away free money, and whose pocket does it come out of?

What we need is more foreclosures to drive prices down into the realm of reason.

sm_landlord, I agree that a $200,000 cash handout for all renters is not a good idea. But my point is that when you compare it to the loan mod programs that were put into effect on account of govt intervention, it is clearly a better idea. Which makes the loan mods absolutely nuts. We should be foreclosing and selling quickly, and letting prices settle at what's really affordable, paid by people who can really afford the homes.

I don't see how anyone can call a bottom given just this chart. Peaks seem to always happen in summer and troughs in January. This summer is so far looks 20-25% lower YoY (guesstimating from the chart). I wouldn't think you'll see any trend until late this year or next Jan trough. I guess you can predict it's near the bottom as next January's low doesn't have much room left to fall before it hits 0.

Here is the easiest way to cut back on spending- don't buy anything made in China. Since it is really hard to find consumer junk not made in China spending will drop.

I think if instead of looking for the cheapest product all of us start looking for the highest quality product at the best price I think we will find that wages will start going up as companies start looking for skilled people to produce quality rather than the cheapest labor to produce junk. Added advantage net cost over time will actually be lower. We have cooking pots that we purchased in 1979 that we are still using every day- they cost a fortune at the time that we purchased them but amortized over 30 years it is an insignificant cost.

What would 200K buy if everyone received 200K?
It used to be called the Land of Cockaigne. Or maybe one of the Gulf states.

"renters are now benefiting from the real estate crash-those very lovely cheaper rents are now manifesting"

Let's see. Where I live, typical homes cost about $1 million. Average rents are about $3000 per month, and have dropped about 3%, or about $100 per month. So an owner who executes a short sale or a walk-away for 30% off, and who borrowed $1 million, can repay just $700,000. That's $300,000 that the owner borrowed and they now don't have to give back. They might have spent all of that $300,000 on fancy dinners, or nice cars, or Swiss bank accounts, or overpriced real estate. I don't care. The money is coming from my (taxpayer) pockets. All that, versus $100 per month less rent for renters. I'll take the $300,000 any day!

How about:

Any REO property sells for $10,000.00 cash. Set a date for this to be done. First time home buyers get to be first in line. Then let the investors in on the deal. People will have time to save up or get financing in place.

Any short sales will be sold, even to the current owner for $50,000.00. Owner occupied gets the first shot. Then first time home buyers, then investors. If the owner occupant has $50,000.00 in equity - his free and clelar.

All home owners get a cram down to current value plus another 10% off. And interest at 2% forever.

All first time buyers get a tax credit of 50% of the purchase price if they buy a home that is not a REO or short sale.

Anyone with a student loan may have the loan discharged up to $20,000.00 if they buy a house.

All renters get $5,000.00 a year for the next 3 years. They can save it up to buy a house, spend it or pay down debt.

Oh and everyone gets a unicorn.

Does that cover everyone? i probably missed someone.

I want my pink pony, dammit.

Seriously folks, I suggested a good exit strategy months ago.

But then South Park makes more sense than our current economic leadership.

Ooops, guess they will take away my badge for that one!

Someday this war's gonna end...

"What would 200K buy if everyone received 200K?"

Exactly, pavel. As usual, you see all the way. The problem with shoveling large amounts of money at anything is that it mostly inflates the price. We have done that for owned homes, and the prices are now totally unsupportable. Instead of recognizing that, we are shoveling even more money into loan mods, and loan subsidies and loan guarantees for buying and keeping homes. All of that is just making each $1 paid for housing buy less.

Having said all that, our leaders have decided to inject large amounts of money into the economy somewhere, to "save the economy for all our sakes". They have chosen to direct most of that money to home owners and home buyers. These people generally are more affluent and save more than renters, and cumulatively have reaped or are sitting on, notwithstanding the recent downturn, massive capital gains since home prices started to seriously outpace inflation back near 1983. If we wanted to boost the economy, and restore some egality, we would be giving cash handouts to renters before we'd pump another $1 into homes.

Of course, the $200K cash handouts for renters is not a good idea. But it's better than what we are doing.

"Other examples colleges, healthcare, civil services."

or, the other extreme, jack up supply and the price goes down. for example, our emergency intervention in the poppy trade seven years ago. now, heroin is cheaper and more available than ever! your tax dollars at work.

broward,
why don't you start a blog disussing how to pick up 25 yr old co-eds instead of work? It might still attract both sides with the old guys giving tips on how to do it and the young chicks rebutting the old guys tricks while adding some nice tricks to pull it off....

Here in San Francisco..starting to see prime cre space in districts available where you wouldn't see it before.....Nova mentioned seeing more ladies in the homeless arena,
I have noticed more of this also..I drive by the EDD, St. Anthony's and other free food organizations at 6:45 AM every day...it's starting to look like depression type lines and I'm in the city..I would hate to see the valley lines....Scary and just pisses me off. Just purchased debtpushers.com.. to start the push back....I'm gearing up for charlie wilsons war in america...

patientrenter:

the reason you're confused is because you think it's a housing issue. You see the asset being the house, with the mortgage being a claim on it. So i'm guessing that you think it's better for homes to decline to the market clearing price; if the homeowner forecloses, then so be it. Furthermore, as prices decrease, individuals come into the market, push back up the price to the market clearing one.

From a macro-financial (?) perspective, the asset is the mortgage and the house is just the collateral. Because of the way MBS/CDO/etc are sliced and diced throughout the balance sheets of every financial institution in the world, the goal is to prop up the debt asset, and so you can't have the aforementioned price-clearing mechanism.

It picked my interest - from the BLS web site, current unemployment rate by age cohort, not seasonally adjusted as June 2009:
16~19 - 27.8% (YoY absolute increase + 5.9%)
20~24 - 16.0% (YoY absolute increase + 5.4%)
25~29 - 10.6% (YoY absolute increase + 4.6%)
30~34 - 9.1% (YoY absolute increase + 4.5%)
35~39 - 7.8% (YoY absolute increase + 3.4%)
40~44 - 7.7% (YoY absolute increase + 3.6%)
45~49 - 7.1% (YoY absolute increase + 3.4%)
50~54 - 7.0% (YoY absolute increase + 3.4%)
55~59 - 7.0% (YoY absolute increase + 3.8%)
60~64 - 6.5% (YoY absolute increase + 3.5%)
65-69 - 7.2% (YoY absolute increase + 3.5%)
70~74 - 6.6% (YoY absolute increase + 1.8%)

75 - 5.6% (YoY absolute increase + 2.7%)

Remember that the unemployment rate includes people who are actively looking for work but can't find it.

As energyecon reminds us quite helpfully, for the population as a whole, the employment to population ratio took a substantial nosedive in this recession. However, this affected mostly people of normal working age. The employment to population ratio for people above 60 has been rising steadily in the past years.
For people aged 70~74 it went from 10% in 1994 to 17% today,
For people aged 65~69 it went from 21% in 1994 to 28% today,
For people aged 60~64 it went from 42% in 1994 to 52% today.

A few minutes with zillow.com looking at Houston reveals two distinct property markets:

1. Low End
   Here there's a good mix of houses selling about 1/2 zesstimate, and houses selling at or above zestimate. e.g. 105k going for anywhere between 51k up to 110k.
   Obviously the blue collar folks are getting slammed. Look out in the west or north of Houston to see this. Some houses are selling near zesstimate, but this seems to have mainly been towards the end of 2008. Last few months see increasing short sales/foreclosures, by estimating from the sale prices.
2. High End
   Look at say inside the loop. Lots and lots and lots of houses listed at 500k up, and nothing is selling. The few sales looks to have happened towards the end of 2008, and are quite near the zestimate.

Obviously, we have two completely different markets, so any broad stats are probably pretty meaningless.

Washington's Dilemma: This Isn't a Recession, It's a Collapse

Washington is bluffing that it will not bail out California, and every other state suffering from collapsed revenues and massive job losses.

Frankly, unless Washington prints money and bails out every state that needs capital, including California, federal power will decline amidst this severe economic recession, and the process of a soft American devolution will begin. If you think this idea is outrageous, then you’ve still not come to terms with a core reality of our current situation: the structure of this financial crisis is wholly different than any in our post-war era. This isn’t a recession. This is collapse.

This is the core problem of this collapse and why the prospect for recovery is dim. Americans can’t actually rebuild the savings that the banking system needs to escape from the current mess. Individually, Americans are trapped by debt and cannot spend.

Washington's Dilemma: This Isn't a Recession, It's a Collapse -- Seeking Alpha

Rob, I agree that banks (and notably everyone's favorite, GS) do seem to have an extraordinary and outsized influence on our institutions. But when Barney Frank decides what legislation to draft or support, he is thinking of more than GS. He is not entirely venal. He is thinking of his party's political supporters, and what he can do to win them over for himself and his party. He also wants to get that extra $200,000 from the next bank for his campaigns. So he figures out ways to please the most powerful banks and the most voters, while irritating the fewest other constituencies.

It is easy to see that lower interest rates, higher asset prices, and loan mods paid for directly or indirectly by the govt are all very attractive to someone in Barney Frank's position. It's not just banks. It's homeowners acting as voters, and many other groups, who are determining the direction we're going in. If I had to pick which group benefits the most in total dollars from all the bailout actions, I'd say its (1) homeowners (through loan mods/forgiveness, continued govt subsidies and support for inflated home prices), (2) investors in mortgages, (3) banks and other financial intermediaries. Per capita, the greatest benefit is (1) a few large investors in mortgages and other fin'l assets, (2) GS and some other financial people, (3) homeowners.

Citizen AllenM - you may want to contribute to the t-shirt printing industry... "I want a pony". Broken link so y'all can do it your good selves.

Sorry. Page not found..
com/screw_world_peace_i_want_a_pony_t-shirt.htm?gclid=CMDqn8Sn4JsCFVlM5Qod4TFB_w

C

But when Barney Frank decides what legislation to draft or support, he is thinking of more than GS. He is not entirely venal

He is not omnipotent either - how much influence did he wield last fall compared to Paulsen??

"A few minutes with zillow.com"

try cyberhomes.com. zillow is frequently horribly overpriced.

josap: not a problem.

Basel two, I am venting a little here. I work in a financial institution, so I agree that there is a very focused effort on keeping the book value of the mortgage assets high. But I do think that there is another significant dimension here. It's not all about banks and insurance companies and other financial institutions trying to remain officially solvent. Homeowners also want lots of goodies, like supports for higher prices. And loan mods are a very effective way to limit the home market clearing.

Even though I work in a financial institution, I'd prefer that we got rid of all these supports designed to funnel money into homes and their related assets. The arguments to continue them strike me as self-interested for at least 70% of all voters.

Lothar, define your goals.

Bartenders are pretty funny. "We don't see a lot of old hetero guys like you. They're usually too angry, too macho or too intimidated to come in here". I played pool last night with two Saudi med students. They didn't want to talk religion or politics or economy, just two kids intent on pool and women. The Global common denominator, I suppose. We talked about LA. and DC a bit.

THE BALCONY CLUB- "BOISE'S BEST PLACE TO DANCE!"

The married chick I met at Hanna's, unemployed husband is a recent return from the Middle East.
Worried about her kids' future, I think.

Humpin' Hannah's (Humpin' Hannah's) | MySpace - myspace.com/humpinhannahs

Here is a summary

US Households: 75 Million
2009 Projected Foreclosures: 3.5 Million (1 of every 21 households)
2009 Projected Home Sales 5.5 Million
Inventory of Foreclosures 2 1/2 years (assuming 25% of home sales are foreclosures)
Number of Homes Underwater 8.8. million (1 of every 8.5 households)
Number of Households underwater if prices decline another 5%: 11 Million (1 of every 6.8 households)

The American dream of owning a home has quickly turned into a nightmare of monumental proportions going well beyond almost anyone's wildest and darkest thoughts.

As unemployment rises above 10% and more Americans are faced with their homes being underwater, the bottom in this market is years away
Mish's Global etc. 

California and Texas believe they would be far better off with no Federal government

Centralized systems are increasingly more efficient as the scale of complexity grows.

However, they cease to be efficient when clever monkeys discover how to exploit the segregation of information for their own personal gain and then centralized systems become a net negative. All the complexity & risk but not of the benefit.

Basil Too:

Did you ever pursue the idea of including the grandchild of your parents on the deed for their new home purchase to obtain the home buyer's credit?

I asked around and no one can find any hole in it.

those jesuits have a knack for getting the sweetest piece of real estate in every town, don't they?

more Americans are faced with their homes being underwater, the bottom in this market is years away

Mish keeps surprising me by knowing so much yet knowing so little.

He's too infected with the Righteous Retribution virus for my taste.

I stand by my prediction. Mish's track record of success will decline over the next two quarters as he grows increasingly strident about how the Collapse "has to happen", and the Feds will continue to thwart his most dire predictions.

"He [Barney Frank] ]is not omnipotent either - how much influence did he wield last fall compared to Paulsen??"

Not omnipotent. There are other powerful players also. My point is that he, Chris Dodd, Chuck Schumer, Nancy Pelosi and Larry Summers are each quite powerful. If Lloyd Blankfein or Jamie Dimon got on the wrong side any one of them, GS would be screwed. We should expect bankers to act in the best interests of the banks - that's that their job. But it's the political representatives who are supposed to act in our interests. That's their job. Why is everyone jumping up and down about Lloyd Blankfein doing what 's good for Goldman instead of what's good for the public? He's supposed to. Mr Frank and the other pols could change what the banks do, IF THEY WANTED TO. And THEY are the ones who are supposed to be acting in our interests. And no, it's not good enough to say that it would be politically bad for them to go against some bank, so they CAN'T. It may be better for me personally to steal $5 mill from my company, but that doesn't mean I have to do it, and it's certainly not my job to do it.

Our politicians are the ones who should be held accountable for doing what we think ought to be done. They do have the power. I see almost nothing in the newspaper every day about Barney, Chris, Chuck, Nancy, Larry. I see lots about GS, JPM etc. Misdirected public ire.

Oh, and last fall, Barney wasn't opposed to what Paulson was doing. Did you think otherwise? he was just making sure that he wouldn't share the blame. That's why he is a pol, and Paulson isnt'.

Don't worry, the Internet is already largely centralized. Simple and basic design concepts

Common design and a common set of rules is not the same as centralization.

Our politicians are the ones who should be held accountable for doing what we think ought to be done. They do have the power. I see almost nothing in the newspaper every day about Barney, Chris, Chuck, Nancy, Larry. I see lots about GS, JPM etc. Misdirected public ire.

I fully agree with that.
The game is the game. You play or get played.

That said, the only way to force politicians do something is to create public outrage. Pecora Commission was critical to laying the foundation for financial reforms in the 1930s.

I want to howl all night.

Gay bars are out for me - I'm in the South and I coach kids. If anyone saw me in one they'd immediately assume the worst. The "I'm just here for the DJ" line wouldn't cut it. Though as a younger guy (college and a year after) I did have quite the extensive access to the LGBT scene due to the people I worked for and just not giving a flip and wanting to hear the best dance music in a midwestern city with a huge college just went to every club I could with the crowd who worked for the people I did (ironically, I babysat their kids). Regular bars wouldn't be a problem, but the few close to me are mostly touristy or after-hours for the servers of the tourists.

I do feed one of the bartenders on a regular basis, though I usually clear out early before the SIN folks arrive. Made that mistake twice and locked myself out of one bar option totally if I see the wrong car, and had to wait a few months for an ex to move before I could go back to the other one safely. Latenight, that is.

Oh well, maybe I'll have a car accident and meet a nice lady...

The possibly temporary bottom is driven by the tax credit. California has given away $10K to each new home buyer and the Feds are giving away $8K to first-time buyers. That is an $18K subsidy for first-time buyers of new homes in the country's largest state. Where I live in California the subsidy helped work of the glut of finished new spec homes that no one had purchased and started several builders building again. The $10K tax credit was all used up in June and builders have since ceased any new starts. There are several builders who have dozens of slabs with roughed in plumbing in place but now have no intention to to continue construction until prices start increasing (or the subsidy comes back). Lots of "starts" in May, and early June that will not be completed any time soon.

Then there is the shadow inventory, which looks fairly large to me from driving housing areas.