Did they call the first leg down correctly?

have eight.

The next leg down is due to interest rate increases. Seems like the "speculative component" of home prices is washed out at this point.

It'll be fun selling $500K McMansions at 8% fixed with 20% down!

250K at 5% = $1342 / month
250K at 8% = $1834 / month

we must stand firm against accepting a word so vague as so

By the time they get the bums out of the house, assuming no vandalism (large assumption) the house will be falling apart at the seams b4 they put it up again for sale. What a waste of resources.

Good Morning all ~~

I'm used to flying in noisy single-engine planes, and to be able to converse with my co-pilot speaking in normal tones w/o a headset was something new for me...

Blackwaterwannabe wrote:

That is what the 'new & relaxed' Immigration policy will be for.
Kills two bird w/ one stone: Utilizes resources and keeps wage demands low.

I wish that was an answer. The standard of living is limited by the total amount of production and the wealth created by that production.

So let's say you bring in 5 million immigrant families, the wages of everyone drops by 5% so they can have jobs and they buy homes. Well now we sold 5M homes, but the entire country has to cut off their cable TV and cell service to pay for it.

It's a zero sum game.

Minor correction: CK the has ten legs down.

Anyway. Of course there is another leg down. All we've done to date is remove a good portion of the speculative blow off top. Now is time for a correction based on employment, affordability and supply/demand. Throw into that the deflationary rent spiral as well. And before anyone points out that there is a lower limit somewhere near replacement costs I have two words of reply. Taxes and Buffalo.

Rob Dawg wrote:

Now is time for a correction based on employment, affordability and supply/demand. Throw into that the deflationary rent spiral as well.

Flint Michigan provides a case study when all of those bits come together in a perfect storm. Let's hope that doesn't happen nationwide.

OT...

It occurred to me the other day that if you live in a state for years, the people you elect create massive unfunded entitlements and then when the bill comes due, you cash out and move to another state...

Well that's just a form of Jingle Mail! The poor / less educated folks that need the entitlements most are left holding an empty bag...

The cruelest folks are those that are "liberal" with other peoples money and "conservative" with their own money.

volker the viking wrote:

as many as it takes to get all the way to the bottom

We have had most of the great credit bubble decline. Now all that's left is a fundamentals decline. Barring the near impossibility of protracted general deflation what other leg down do you see? I do see some severe localized declines for places massively misallocating investment like Merced and Detroit. I can almost guarantee specific disasters from misguided municipal efforts at taxation but those are local. Generally it still about 5% too many houses and 5% too many unemployed. IMO those alone a good for another 10%.

Juvenal Delinquent wrote:

After driving around Buffalo for a week, I realized it was our country's future...

If you're from there, you realized that a long time ago. In the early 90's, someone spray painted "This is Buffalo's future" on an abandoned building downtown. It remained for years before someone painted it over.

Rob Dawg wrote:

I can almost guarantee specific disasters from misguided municipal efforts at taxation but those are local.

Rob, I think the shock has been sufficient to expose severe weakness in fiscal policy in more arenas than mortgage lending or municipal budgeting and borrowing. My own concerns arise from accumulated fragilities which are unmasked in such a severe downturn.

And I'm not optimistic that the misguided localities are few in number - or that their oddities are limited to taxation efforts.

Rob Dawg wrote:

When the real recovery comes and it will come to coastal CA first I am still planning on a road trip to Buffalo for some $5,000 houses I can strip for architectural elements. I'll bring back leaded glass, door hardware, hardwoods, dentition, railings, mantles, etc and make a fortune and do my part to aid both economies.

You're too late. It's well known that most of the older homes have had these stolen from them, in some cases by the contractor. The way I heard it, they were usually shipped out to CA.

Buffalo's (and Cleveland's) reason to live went away 50 years ago when the St. Lawrence Seaway was opened, they outsourced their livelihoods...

When the banks are holding 6 million (18 months additional supply) and say they are going to control how many come on market all I can think is "OPEC quota compliance." Get ready as every individual thinks they can rush to market and beat the rest.

Camarillo? I don't know. Can't say. There was nothing in the way of outward appearances which led me to anticipate difficulties at Half Moon Bay. But there it was. Nice towns, too. Prosperous, one would have supposed.

Rob Dawg wrote:

We have had most of the great credit bubble decline. Now all that's left is a fundamentals decline. Barring the near impossibility of protracted general deflation what other leg down do you see? I do see some severe localized declines for places massively misallocating investment like Merced and Detroit. I can almost guarantee specific disasters from misguided municipal efforts at taxation but those are local. Generally it still about 5% too many houses and 5% too many unemployed. IMO those alone a good for another 10%.

you are well read and erudite in your position

Perhaps the local mis-allocations you mention are or will be systemic, perhaps gradually and resonating out or perhaps more rapid from the cascade effect others mention.

As for when and where the bottom might be, perhaps the most obvious marker would be time tested valuations and how they compare to other historically proven benchmarks.

I still anticipate a 150 to 200 on S& P and 1500 to 2000 on the Dow. If gold values are close by, that's the bottom. Not my original thinking, one I have confidence in though, until it's wrong.

longwaver wrote:

It'll be fun selling $500K McMansions at 8% fixed with 20% down!

250K at 5% = $1342 / month
250K at 8% = $1834 / month

And don't forget:

183K at 8% = $1342 / month

183 / 250 = 73%

longwaver wrote:

Flint Michigan provides a case study when all of those bits come together in a perfect storm. Let's hope that doesn't happen nationwide

That's right. I beieve Obama's miguided Santa Claus flights on AirforceOne like yesterday's to LV where he showered $1.5B to rounds of applause should be curbed, quick. I get the sense that $1.5B will be needed to fund soup kitchens and the national guard.

some investor guy wrote:

Even low wage immigrants will create jobs and demand just by being there.

Then put your theory to the test. Invite 10 immigrant families to live with you and see how much wealthier you are in a year. You can stack em' like cord wood and you'll be Gates/Buffet rich.. just because "they are there"..

Rob Dawg wrote:

When the real recovery comes and it will come to coastal CA first

Really? This is the home price recovery?

Being from Coastal CA, what I expect is that most of it will never have the vacancy rate of Riverside, but that the prices still have a long way to fall. State government's ongoing attempts to kill local budgets might still manage to make things go wrong in the richer areas. I am especially worried about firefighting in places like Malibu and the hills near Santa Barbara. In the wrong weather conditions, all you need is a significant delay in response, and the fires go from lightly populated areas to heavily populated ones. Many of those areas don't even think of themselves as being at high risk.

LoserBeachBum wrote:

USA spends yearly 700+ billion dollars to weapons in order to lighten up the skies of Iraq and Afghanistan, among other useless military adventures. Meanwhile, the streets of homeland are literally left dark...

No worries.. Michelle O. is fighting childhood obesity... Although I would say that Barack is doing a better at it.. Every job eliminated or destroyed saves another 2.5 kids from the horrors of obesity!

Juvenal Delinquent wrote:

$1.5 billion gets given out with much fanfare, but when Grayson asked Bernanke where $500 Billion went to, Benito said "I don't know".

It the song of the money changers... They all sing it!

What if “saving for retirement” from the day you start work is a scam?

“They”
- Use tax incentive to get you to put money into the global financial system with the fleeting promise of compound growth
- Use tax penalties to keep you from pulling it out
- Have you watching CNBC and reading financial websites and subscribing to magazines because you’re worried about your savings
- Have you moving money around (stocks to bonds and back) to avoid the pitfalls that you just read about (and they take a cut each time)
- Convince you to save more and more for retirement, which then keeps you in debt on homes, cars, etc. so that you are paying “them” interest

What if you cashed out your savings, paid down debt and stop saving for retirement?
- You can stop caring about the global financial market (just be worried if your company’s stock tanks)
- You pay down a HUGE chunk of debt and stop paying interest
- You free up potentially thousands of dollars of free cash flow per month by paying off debt and not saving for retirement
- You can pay cash for big expenses because of your new found cash flow and when the roof doesn’t need replaced you wail on the mortgage until it’s gone
- So you end up in your late 40s / early 50s without a nickel of debt, you own your home and everything in it / parked around it outright, you have thousands a month in “extra cash” and you spend the next 10 years piling up massive amount of cash for retirement (during your best earning years)
- And if you get laid off after you’ve cleared all the debt, who cares… You’ve got no debt and a severance check that could probably feed your family for a couple years.

A glider, Pavel. They're lovely.

We used to have a time proven formula for preventing this sort of thing:

10-20% down payment
LTV <= 80%
DTI <= 28/36
FICO > 620

RueTheDay wrote:

We used to have a time proven formula for preventing this sort of thing:

10-20% down payment
LTV <= 80%
DTI <= 28/36
FICO > 620

The funny thing is that now is exactly the time we need NINJA loans... Since the people who need homes have no income and no jobs... Ironic isn't it?

Does anyone think that when the US financial crisis reaches its height, they won't end up seizing pensions and 401ks?

Hoop, Yes and tax the air you breath. I'm rural, very rural and favor this to any other part of US.

are we not double counting?

Of the 6.1 million who will be losing their homes some will
a. move into rentals
b. be homeless
c . move in with family / double up
d. purchase another home.

Those that purchase another home both add to and subtract from the "shadow inventory". Those that move into rentals will reduce the inventory of rentals and increase the supply of SFH but will leave the net inventory of housing unchanged. Only the those who in with family/ double up or become homeless add to the inventory. How large this group is will make all the difference.

IMO just looking at the aggregate data will miss the much more significant underlying changes. If we are about to see a big burst of foreclosures I think we may have seen the top of the rental vacancy cycle as people are driven from ownership into rentals. I think we have probably seen the maximum "accidental landlords" . From here on they are just going to be foreclosed on.

I think what we will see is a large surplus of SFH in distant suburbs (IMO they are toast) but probably simultaneously a shortage of denser housing closer to the city.

Hoopajoops LTD wrote:

Does anyone think that when the US financial crisis reaches its height, they won't end up seizing pensions and 401ks?

Administering. Administering for your own good. Seizing is such a harsh word. And understand, it will come as a welcome event. The faustian bargain will be takeover in exchange for being made whole after their values tank.

First they came for your gold. Now they come for your specie.

Rob Dawg wrote:

Administering. Administering for your own good. Seizing is such a harsh word. And understand, it will come as a welcome event. The faustian bargain will be takeover in exchange for being made whole after their values tank.

I'm cashing my 401k out this year.. Before they take it and before the Bush tax cuts expire. Time to exit the casino. I can pay off a ton of debt and keep the interest on that debt away from the money changers. WIN-WIN

some investor guy wrote:

permanent resident of the United States

How are you going to bring rich immigrants in without giving them green cards?

Hoopajoops LTD wrote:

Does anyone think that when the US financial crisis reaches its height, they won't end up seizing pensions and 401ks?

Sacrifice now. For EVERYONE's benefit. We'll provide a State Run substitute, later. Smae as the healthcare proposals.

crazyv wrote:

If we are about to see a big burst of foreclosures I think we may have seen the top of the rental vacancy cycle as people are driven from ownership into rentals.

I have a friend who works at a large apartment complex. The big foreclosure boom that already happened resulted in fewer tenants. Apparently, the large number of cheap homes for sale and for rent were the cause. They have more vacancies while charging lower rates. They didn't get many people applying to live there who had just been foreclosed.

some investor guy wrote:

If poor, they are more likely to go to modest apartments, or to pack a single family home with 2 families of 10 or more people. In Los Angeles, there were many such families who generally could pay their bills with cash. Not only did they typically avoid credit, many didn't have bank accounts. Of course, a large portion of the illegals didn't pay income taxes. They tended to pay property taxes indirectly as renters, and sales taxes.

I have a quicker way to get "rich fast" using your method.. Let's make Haiti a new state! They are poor and there is a ton of folks down there that need all kinds of things.. Homes, food, etc.. Massive demand just waiting to be tapped into!

"Does anyone think that when the US financial crisis reaches its height, they won't end up seizing pensions and 401ks? "

Those funds are already probably somewhere in the banking system set up secretly as gambling collateral to some Super-CDS gazillion dollar derivative play with 1:500 leverage ratio. Then they will some day soon say, like in one South Park episode, "AND....IT'S GONE!"

Does anybody think the thieves that manage 401k plans won't give up their cash cow without a huge fight?

NervousRex - Thats our tax dollars at work...and yes, creepy

It really depends upon the who are the immigrant families...

30 years ago LA was the beneficiary of well to do Iranians, who have done quite well for themselves.

In that case, it will mean that most of the financial industry has lost its political power. If people have to invest in treasuries or TIPS, there won't be much trading or commissions.

I meant to say government-sponsored annuities. I would expect a leaky, bezzle-infested government-backed private entity, like AIG, to run the annuities. That way the financial industry AND the government both get their slice.

As long as the Yanqui dollar is backed by nothing, why would Big Gov want to seize more of the same?

some investor guy wrote:

If they don't work and pay into medicare, they still won't get the benefit.

Canada used to give green cards for people who bring in certain amount of money($2m?) and/or employ 10 people or so. We too may already have such a system. Canada's health care system can handle this, I doubt ours can. When somebody is in the country legally AND permanently in the US, the state is always on the hook for health care, directly or indirectly, thru medicare or medicaid or emergency rooms!

longwaver wrote:

Pay off your home and enjoy life

The biggest fraud perpetuated on the American public was the home mortgage deduction. I can't tell you how many people have told me that they don't pay down their mortgage because of the tax deduction. How few people understand that if you have a mortgage and a stock portfolio what you are essentially doing is mortgaging your home to buy stocks i.e own stocks on margin.

longwaver wrote:

Retirement savings for the young is a scam.. Pay off your home and enjoy life. When you hit 45-55 and you are debt free and in your prime earning years you can bank thousands of $$ per month for "retirement".
Btw.. what retirement is waiting for folks in their 30s? Social Security and Medicare? HA!

This is an interesting assertion. Most college age people either believe there won't be any social security when they are 65, or the benefits will be very radically changed.

For people with high interest rate credit cards or other loans they can't easily refi, paying them off may be better than having a 401k contribution. In the current environment, paying down high interest debt is a good investment. For many young people, that's their student loans. Almost impossible to get rid of the debt without paying it off (though some people have gotten other credit to pay off student loans and then defaulted on the other credit).

"Btw.. what retirement is waiting for folks in their 30s? Social Security and Medicare? HA! "

30 coupons to McDonald's and a red pill. Really excellent retiring worker might get a plastic medal and a Happy Meal.

Now that it's clear our governing system is compromised beyond possibility of painless repair, I'm on the lookout for the corralito coming to America.

some investor guy wrote:

For people with high interest rate credit cards or other loans they can't easily refi, paying them off may be better than having a 401k contribution.

Yep.. I have no credit card debt, but can kill off a straggling student loan and a car loan thats almost gone. Take the rest and plow down the home. Easy peasy and I'll sleep so much better. Living in a casino takes it toll on your sanity... So I'm cashing out my chips.

longwaver wrote:

So let's say you bring in 5 million immigrant families, the wages of everyone drops by 5% so they can have jobs and they buy homes. Well now we sold 5M homes, but the entire country has to cut off their cable TV and cell service to pay for it.

It's a zero sum game.

Its not exactly a zero sum game. When a large population immigrates they both consume & produce - activity does snowball some - so there would likely be a net gain in aggregate.

HOWEVER the benefits and costs would not be shared equally - it would like be a situation where 'capital class' would benefit FAR MORE [lower cost factors of production & also somebody to consume their unabsorbed collateral - housing] and the laboring class take the hit far more [wage suppression and competition for said ex-cheap housing].

In short more 'class war'.

longwaver wrote:

I'm cashing my 401k out this year.. Before they take it and before the Bush tax cuts expire.

I've been on the fence about that. The 10% penalty bites. I would think there would be some warning before they just take it.

SNAFU wrote:

Canada used to give green cards for people who bring in certain amount of money($2m?) and/or employ 10 people or so. We too may already have such a system.

yes, the US has the same thing.

"Show, using reasonable methodologies, that 10 or more jobs are actually created either directly or indirectly by the new commercial enterprise through revenues generated from increased exports, improved regional productivity, job creation, or increased domestic capital investment resulting from the pilot program." Immigration through Investment - Immigration

Rob Dawg wrote:

smoking craters next to untouched communities

Where desperation meets opportunity...just sayin'

Mr Slippery wrote:

I've been on the fence about that. The 10% penalty bites. I would think there would be some warning before they just take it.

They won't ever "take it".. They just won't let you access it. Or they will increase the penalty to 20%

Pearl wrote:

I never wanted a healthy cock--I can't make as much money off of healthy cocks.

I will not touch this one.

Another way to look at it is: you just got your warning.

Mr Slippery wrote:

The 10% penalty bites.

let it...that's what it's there for. Better to move it and pay the tariff.

or at least the way i figger it. The terms were set up to rope us in, and they won't let us out without some sting. Pay it.

some investor guy wrote:

yes, the US has the same thing.

"Show, using reasonable methodologies, that 10 or more jobs are actually created either directly or indirectly by the new commercial enterprise through revenues generated from increased exports, improved regional productivity, job creation, or increased domestic capital investment resulting from the pilot program." Immigration through Investment - Immigration

Why do you think so many chain and franchise motels here are owned by Indians & Pakistanis? Or China Buffets by Chinese? By buying a franchise and operating it [assuming they 'create' enough jobs] allows them fast track immigration. That has been going on a long time - it was common even in the 70s [I knew an udon noodle & tempura house that naturalized two different Japanese families here in the 70s - same strategy used back then].

JP wrote:

I will not touch this one

I know. The only other analogy I could think of was dog fighting--but I'm all snuggled up with a chihuahua, a pomeranian, and an Italian Greyhound right now. What if they can read? I don't want them worry needlessly.

some investor guy wrote:

If you bring in wealthy immigrants, you might get money without a need for jobs.

Houston is seeing a fair bit of that, on the (E? visa), where they have to invest $150K(?) into a US company...

some investor guy wrote:

How is your supply of canned goods?

Low. I don't have much space to put them. I am also saving cash, which doesn't pay interest, but then not much does anymore. I'm saving for a house/escape plan, and I'm more convinced of gold than Ben's printed greens.

Rob Dawg wrote:

You are assuming the smoking crater communities clean up their act and become viable investments again. I'm sorry but I'm not going to trust them with my illiquid investment efforts until after they get their houses in order.

What happens with failing localities depends a lot on the causes, and the treatment. The hardest to deal with, by far, is a decrease in population brought about by something which is not a city's fault. The local industry no longer needs many people.

Corruption and inefficiency have a long record of being curable, if the economies in those areas were otherwise ok or good. Sometimes it is a new administration or a criminal investigation that cleans up these problems. Other times, it is a state takeover. It's remarkable how many places that claimed they didn't have enough money and couldn't do certain things find out indeed they can, under different management.

Backsheesh to the future?

some investor guy wrote:

I remain unconvinced by the gold bugs.

Does that mean you remain convinced by the paper bugs? It's possible the government might right the ship on the other side of this crisis, but it's also possible that the other side of this crisis has a new world reserve currency with a massively devalued dollar.

Rob Dawg wrote:

Bribing the guards at the border to gain entry. Gee when was the last time that was happening and how did it turn out?

There goes Robertus Canis making a big huff over nothing... it will be different this time?

Keynes v Hayek 

Fear the boom and bust, indeed....

Last time I was in NZ arriving in Auckland, the next flight deplaning was from the People's Republic and they were in the customs line behind me, but in lieu of little red books and Chairman Mao suits, they were clutching mauve passports and wearing the latest in European fashions...

While some worry about which stock to buy or sell many are worrying about what "Backed by the Full Faith & Credit" actually means precisely, when you get right down to it. I suppose "In God We Trust" should offer a pretty good clue.

Re: 20% down, 36 DTI, decent FICO.
Guess you guys didn't pay attention or the media didn't report some of the testimony during the FCIC meeting.

An excerpt:
What caused this problem was, as has been stated by previous panelists, risky loan products that existed for only one purpose. It was these loan products forced repeated refinancings that would continue to line the pockets of originators. It’s also important to note that contrary to what we heard earlier today, Wall Street was not just an impartial ATM giving out money to originators. Wall Street was asking for the riskiest loans. In one New York Times article, a CEO of a lending company told the reporter, “They were paying me more for no-doc loans, so I told my people to have the customers put their W-2s away.”

Similarly, the word from Wall Street was we pay more for no-doc loans. And, you know, if you are the one producing the loans, you’re going to produce more no-doc loans, which means you’re going to say to your brokers, “Don’t ask for the customer’s W-2s.” I can show you rate sheets that say that.

dryfly wrote:

Rob Dawg wrote:
Bribing the guards at the border to gain entry. Gee when was the last time that was happening and how did it turn out?
There goes Robertus Canis making a big huff over nothing... it will be different this time?

Not unless we clean up our act in time. We have the weirdest love/hate relationship with immigration. Now we are compounding with IMO adverse selection criteria and a paranoid overlay of imagined security issues.

Mr Slippery wrote:

Does that mean you remain convinced by the paper bugs?

No. However, there are a gigantic number of places to spend, invest, or hide your money. Almost everyone has a mattress.

If you think the problem will be US hyperinflation, then invest in something foreign denominated and don't pay off any fixed rate dollar debt early. If you think the whole country will fall apart, consider moving now while prices in other countries are still reasonable. If you think the US will become a vastly more dangerous place, consider where you want to live within the US if you will be staying.

Rob Dawg wrote:

Not unless we clean up our act in time. We have the weirdest love/hate relationship with immigration. Now we are compounding with IMO adverse selection criteria and a paranoid overlay of imagined security issues.

I agree [I was ribbing you wrt 'different this time' - its 'always' different this time except it never really is]...

Juvenal Delinquent wrote:

Last time I was in NZ arriving in Auckland, the next flight deplaning was from the People's Republic

The fantasy might be to capture wealth like moon beams (Byz where are you?) and emigrate to a cleaner pasture.

Fact is, most never have "enough", or if they do, have even the slightest idea of how to live once "arrived".

Sad it is, but there you are.

dryfly wrote:

State takeover as an answer? YMMV state to state on that.

Massachusetts did a good job with Springfield. That was a corruption and ineptitude issue. It will be the blood from a stone problems in FL, AZ, CA that won't cure as easily.

MommyKnows wrote:

This makes sense. So probably true. Ugh.

MommyKnows--it drives me crazy that banks are blamed for not knowing how to choose healthy (chickens .) It lets them off the hook; what they did was so much more nefarious. In addition to that, it tends to turn one American against another-- "those stupid poor people wrecked our economy."

Putting the wrong criminal in jail for a crime is not just bad for the wrongly-accused criminal. It's bad for society, because society still has a criminal on the loose.

Sorry. Gotta go back to decaf!

Rob Dawg wrote:

It will be the blood from a stone problems in FL, AZ, CA that won't cure as easily.

And of course Illinois where the small isolated island of corruption [Chicago Machine] dwarfs the rest of the state. Good luck fixing that from Springfield Illinois.

Some states can pull it off - most would have difficulty for one reason or another and at least a few [like say NY or Louisiana] the state is every bit as corrupt or more corrupt than their worst cities.

longwaver wrote:

Does anyone think that when the US financial crisis reaches its height, they won't end up seizing pensions and 401ks?

I expect that they will take away the tax incentives for 401ks unless you "invest" in Treasuries. "

First they will unchange the rules regarding 401k inheritances, so that heirs have to take it required minimum distributions over the deceased life expectancy, preventing turing 401ks into perpetuitites. We may next see a rule about mandatory annuitization of 401ks and IRAs which has the same effect, i.e. the default is either a 2 life annunity (spouses) or a full refund annunity paying both estate and income tax as recieved (effective tax rate would be in the 60% range next year)

some investor guy wrote:

If you think the problem will be US hyperinflation, then invest in something foreign denominated and don't pay off any fixed rate dollar debt early. If you think the whole country will fall apart, consider moving now while prices in other countries are still reasonable. If you think the US will become a vastly more dangerous place, consider where you want to live within the US if you will be staying.

I am uncertain about how it ends. But I have a high degree of confidence that if I need to get the family out of the country quickly, gold makes a better bribe at the border than any currency. If the problem turns into hyperinflation, gold should retain purchasing power better than any currency. If the problem is massive deflation, gold should retain purchasing power as well as cash and better than stocks. Gold loses if the system remains stable with low inflation or it becomes worth the same as yap stones.

Pearl wrote:
Putting the wrong criminal in jail for a crime is not just bad for the wrongly-accused criminal. It's bad for society, because society still has a criminal on the loose.
Only social ostracism and ridicule, and the stripping of status from the financial class' terrorists and con-men can actually do anything at this point. It's clear that government is incapable and unwilling to bite the hand that feeds it caviar and foie gras. The only alternative is going to be mob violence.

FJ2 wrote:

Wouldn't that help the banks

Banks want defaults. They have purchased insurance for defaults. When a home defaults--banks are made whole. (Why else do they insist upon being 3 months behind on payments? Because 3 months behind=default=insurance payout.)

The only alternative is going to be mob violence.

There's still time to get away from the Big Smokes where the deal is going to go down...

SNAFU wrote:

Canada used to give green cards for people who bring in certain amount of money($2m?) and/or employ 10 people or so. We too may already have such a system"

The US already has such a system the investor visa (EB5).

SNAFU wrote further:
When somebody is in the country legally AND permanently in the US, the state is always on the hook for health care, directly or indirectly, thru medicare or medicaid or emergency rooms!"

Yes to the emergency room, for emergencies but not otherwise unless eligible for medicare or medicaid. For example cancer treatment is not an emergency issue so that no insurace no coverage, unless you find a chariatable foundation. So to ensure medical care in that case spend yourself into the poor house.

some investor guy wrote:

This is an interesting assertion. Most college age people either believe there won't be any social security when they are 65, or the benefits will be very radically changed."

My parents born in the 1920s said the same thing about Social Security in the 1960s. So this is a common generational thought. Now deceased they got their full allotment of SS. It seems the younger generation always holds this view about social security. (Of course my mother was influenced by my grandfathers views on FDR (not positive in the least))

ResistanceIsFeudal wrote:

The only alternative is going to be mob violence

The rational thing to do is for everyone to stop paying their mortgage until such time that a party comes forward in court with legal standing to foreclose. This will be the most humane and efficient way to correct this present course. We do have leverage--we are living in it.

Rob Dawg wrote:

You are assuming the smoking crater communities clean up their act and become viable investments again. I'm sorry but I'm not going to trust them with my illiquid investment efforts until after they get their houses in order. The urge to treat businesses as captive revenue streams will take decades to flush out of most communities.

No, sorry for my unintended obscurity - the economic desperation of the smoking craters intersecting with the untouched is where the ramp in crime stats will occur...

MommyKnows wrote:

My guess is they had a few reasonable offers. Just no reasonable responses to them. Today's insulting lowball is next year's $10k over list sale price.

Ding ding ding! Made an offer on a house in the energy corridor area of Houston, offered to take out the owner for what I thought his purchase price was in 2002...which was ~15% haircut from current asking, this after being on the market for ~15 months (and current asking down 20% from initial asking). His agent: "It's already priced less than its worth."

Reminds me of one of my cousins recent experience in CA, my uncle passed away a bit over a year ago and she was selling the house...turned down an offer early on as 'too low', ended up selling recently for $70K less than that offer.

It's very optimistic to assume that 5 million foreclosed homes will be fed into the market at a steady and controlled rate over three or four years. Given the hundreds of billions of dollars at stake, some sort of rush is more likely. But even if the steady-and-controlled scenario comes to pass, new housing starts would have to be very low for years to accommodate the extra 5 million sales. As CR points out, new construction provides the jobs.

"gov't funded work is all there is now."

Recipient Reported Data Map

crazyv wrote:

There is absolutely no reason why the Treasury shouldn't be offering an annuity along with TIPS and short and long term debt securities. It is just another investment security. They are not hard to price- life expectancy table being something that there is very good public data on. If the treasury offered them they would have sufficient scale to eliminate any actuarial risk.

Just like "no one" though house prices could tank nationwide, no one thinks actuarial data could go Black Swan. I wonder....
In any case, even if lifespan actuarial data stays Gaussian (for lack of a better term), the miracle compound interest environment may be gone for a while.....