John Preston

Why House Prices Will Resume Their Fall

OP

You are one of the few who are active on this site who continually needs the support of profanity to make an argument..why is that?

Anyway, Your blast at RE agents demonstrates a really narrow vision of the free market and rational/responsible behavior.

Bad RE agents are no worse than any "bad" service provider or product perveyor. Attorneys...CPA's....s... owners...taxi cab drivers... all aspects of commerce, have bad apples, who push their product or service for a buck.

Anyone who touts a point of view is shilling for themselves...me and you included.....

Rational are reasonable behavior,on the part of market participants, is the goal of a free market, not the reality of its observed behavior.

Businessmen and market participants do not appear to be striving for sainthood.....so lets keep the bar the same level for all.....and let's keep it clean...


On Jul 31 12:58 PM OptimizedPrime wrote:

> @User 464204 -- Finally, an honest real estate agent, or at least
> one that "gets it".
>
> These days there are two kinds of agents:
>
> 1. Agents that will do anything, lie any lie, join any and every
> fantasy of a Seller in order to get the listing. Whereas other agents
> offer the Truth, they offer Hope. They get the listing and the honest/realistic
> agent goes begging.
>
> Then they join the Seller in waiting until hell freezes over for
> somebody to come buy their home at the 2007 price, possibly dropping
> the price by the odd 1-2% to "adjust" to the market.
>
> 2. Agents that are honest and want the sale to CLOSE, not just sit
> on the market for months/years. Agents that show sellers the literature
> that informed people here on the Internet read every day about the
> direction of the market. Agents who will tell sellers that NOW is
> the best time to sell because their losing investment is just going
> to LOSE EVEN MORE if you wait.
>
> In other words, agents who will SCARE THE SHIT out of a seller to
> get them to move.
>
> You don't need to make anything up to scare somebody in this market.
> Just show them the facts and trends and they'll sign whatever you
> want.
>
> Agents, try this with me:
>
> "There have been many better times to sell, but those days are gone
> forever. I'm very sorry you missed the rocket to riches. Now it's
> time to be realistic. NOW is the best time to sell for the next 10
> years and possibly forever. Profits are not going to happen. Cut
> your losses before you lose everything."
>
>
> OP

No One Saw This Economic Crisis Coming?

Jeff

The term "liars loans" actually originated in the 1980's...but you knew that, I'm sure...

Actually, most of what transpired during the last 5-7 years in mortgage lending actually dates back to the 1980's...which is one of the anomolies in the current crisis...thee actually was a knowledge base available for review and guidance....

The real delta was the changes in agency underwriting, and development of overly complex and risky (yet highly profitbale) ways to manage the mortgage investments at the back end of the system......


On Jul 12 02:19 PM Jeff Nielson wrote:

> As User353732 (and others) correctly point out, this was a "surprise"
> which could not possibly have been missed by anyone with their eyes
> open.
>
> The author's suggestion that this was simply a case of "good" people
> with "bad" models who made an "honest" mistake is UTTER NONSENSE.
>
>
> U.S. home prices TRIPLED while real incomes were falling. Not ONE
> DOLLAR of those price-increases was sustainable, and EVERY dollar
> of that price-appreciation will be lost (and more) - meaning a total
> price-decline in the U.S. housing market of greater than 67%.
>
> Putting aside that ONE totally obvious indicator, NO ONE (with their
> eyes open) could POSSIBLY have failed to see the rampant mortgage-fraud
> in the U.S. Many of those loans had already received the nick-name
> of "liars' loans" a YEAR before the bubble burst.
>
> Is there anyone with an I.Q. greater than their shoe-size who could
> NOT understand how writing HUNDREDS OF BILLIONS OF DOLLARS in fraudulent
> mortgages, and then LEVERAGING that fraud by a MINIMUM of 30:1 would
> implode in a very short period of time?
>
> As Swaps pointed out in his comment, the only reason why this multi-TRILLION
> dollar Ponzi-scheme lasted as long as it did was that the U.S.'s
> corporate propaganda-machine (i.e. the "free press") was preaching
> Wall Street propaganda 24/7 (rather than INFORMING people about what
> was REALLY going on).
>
> The author is nothing more than another Wall Street apologist looking
> to explain-away (through specious arguments) the largest corporate
> crime-wave in global history (see "U.S. bank-fraud SYSTEMIC and INTENTIONAL
> - William Black" www.bullionbullscanada...;view=article&...
>

No One Saw This Economic Crisis Coming?

You all know that all 6 "lookouts" on board actually survived the sinking....

like the lookouts of todays crisis, all of those screaming to be heard by the masses that" they made the call".... they will all also survive....

However, like the Titanic lookouts, who were too late to save the ship, out modern day lookouts were way to late to save the economy.

Perhaps we should not pay as much homage to our modern day wannabe seers as we do.....after all, we did hit the damned iceberg....


On Jul 12 08:53 PM User 357705 wrote:

> Titanic. Good metaphore. USA today is exactly where the Titanic was
> after the stern section broke away from the forebody.

No One Saw This Economic Crisis Coming?

4 years ago was too late.....this mess began 14 years ago..at a minimum..


On Jul 12 08:15 AM doc tari wrote:

> Anyone with half a brain saw it coming 4 years ago..and the smart
> people were writing about that. Where were you.

The Truth About Jobs

Berrnard...

There are places...not in Detroit...where employers have found enough poor soluls to lay off...

Take Yuma, AZ for instance....Unemployment is this area is 24% at last count.....

The fact that respected economists have, for several years now, written on the relationship between housing/wealth effect (See Shilller..see Bostic...just google "housing wealth effect"...)...and consumer spending...and all those who have championed the fall of home values seem to have ignored this realtionship....why should we be surpised that unemployment has gone up.

I wonder if the headlines read "Another 2 million 'customers' were sidelined this month due to the economy", if there would be a different attitude and different solutions suggested....

I do believe that the economy can get a lot worse....if enough poorly formulated thought and rhetoric become the rule ofr the day.

The mindset of those who cheered for housings demise, and the collapse of new home construction.... and chanted "down...down..down" as the CS index fell..were actually laying a large portion the foudation for the current mess....

When we needed proactive solutions...we got destructive attitudes...

When we needed rationale thought, we get headless banter..

Yes, things can and will get worse, if we keep up the wrong behavior.....

By the way, good analysis....


On Jul 10 11:35 PM Bernard Thomas wrote:

> I don't think it could double. Could layoffs continue? Sure, but
> at a slower pace as the economy slows to replacement rate activity.
> I have a decidely negative view of employment and believe we will
> see more job losses, but at a slower pace. I am not saying that the
> slower pace is a sign of an approaching turnaround, but that we are
> beginning to sette in at the bottom of an economic crevasse.

The Current Economic Crisis: Hell, Meet Handbasket

Where is the plan to fix....there are plenty of weathermen and reporters telling us what jsut happened....this is a great report...but, after all of the reporting....what is the plan to fix it?????

Why Lending Standards Did Not Fall

In some cases, subprime lenders actually had higher average FICO scores than did Fannie and Freddie....and certainly higher than FHA, during the period from 2001-2007.

Investors and speculators found it easy to pay a rate premium when they were getting a yield premium...through rampant appreciation....

That said, the fact that lending standards expanded, and have now contracted, is at the core of the issue for lenders...this arbitrary, greed/fear driven cycle of accordion-like expand-contract-expand is manipulation...not market action...