NoFate

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    • Sun Sep 16th 15:30 PM | Rating: 0 0
      Commented on:
      What's So Troubling About Tomorrow?
      Here is a good graph to show my point:

      calculatedrisk.blogspo...

      Notice that UE looks pretty normal until it hits a gray recession bar and THEN it spikes upward. It's already game-over at that point.
      View article »
    • Sun Sep 16th 14:53 PM | Rating: 0 0
      Commented on:
      What's So Troubling About Tomorrow?
      I don't disagree with anything stated in this article, but would add a clarification.

      Generally recessions begin when UE is very low, because employers don't know to start laying people off yet. Using unemployment as your "recession indicator" is a bit like looking thru the rear view mirror to see if you hit the wall yet. Employment (or UE) is a lagging indicator.

      I would hope that the Fed is looking at other things (there are many leading indicators) ...though the Fed is often late to cut rates, so who knows?
      View article »
    • Sun Sep 16th 14:31 PM | Rating: 0 0
      Commented on:
      Consumer Confidence Number Comes Through
      Hi Roy - I personally thought the RBC was the "news," since it changed so much month to month, but I totally get your point. I'm also probably a longer term investor than many on your site, so I can see how this might influence what gets posted. Thanks for the response and clarification!
      View article »
    • Sun Sep 16th 01:05 AM | Rating: 0 0
      Commented on:
      Economists Up the Odds of a Recession -WSJ
      Economists are notoriously bad at predicting recessions. Here is a pretty good set of indicators:

      bigpicture.typepad.com...

      There are other good indications:
      - New home sales (if they go below 600 million, not there yet though)
      - Part time employment craters (this is occurring).
      - Inverted yield curve (it's inverted)
      - And others...

      Anyway, Economists can't even figure out if we were in a recession sometimes until 2 years later. They are the last group of people I would ask.
      View article »
    • Sun Sep 16th 00:53 AM | Rating: 0 0
      Commented on:
      Consumer Confidence Number Comes Through
      There were results of two confidence indices released yesterday. One stayed essentially unchanged from July and the other cratered.

      Specifically, the RBC Cash Index (also Consumer Confidence) just hit 71.1, which is a year and a half low. August was at 89.3!!

      www.businessweek.com/a...

      Did the market rally on the Michigan Index and ignore this one?

      Why did YOU ignore this one?
      View article »
    • Sat Sep 15th 15:01 PM | Rating: 0 0
      Commented on:
      Recession Now Economists' Greatest Fear
      Economists are notoriously bad at predicting recessions. Right after the NASDAQ crash I think I read they put the odds at only 50% or so.
      Whatever their probability is, I would at least double it.

      Besides, there are much better indicators out there:
      - Inverted yield curve (10 year versus 3 month rates)
      - New homes sales (if it goes below 650 million/year rate watch out)
      - Part time employment numbers (generally lead full time by 6 months or so)
      - Others I don't recall at the moment.

      The best thing to do is triangulate indicators like this, which I believe are trending down, but not quite there yet. And throw out the economist forecasts which are right about as often as a stopped clock...
      View article »
    • Fri Sep 14th 20:22 PM | Rating: 0 0
      Commented on:
      Bill Miller On Timing Buys In Housing Stocks
      I just noticed XHB on your post which is home builders, not the REIT index. They have dropped further ...still not enough though. Consider that there is a 9.5 month inventory of unsold homes and it is still growing ...we are gonna have more houses than we need for the next 5-10 years. Half these guys will go out of business ...the other half will end up at $5/share.
      View article »
    • Fri Sep 14th 20:18 PM | Rating: 0 0
      Commented on:
      Bill Miller On Timing Buys In Housing Stocks
      Using IYR as an example, housing looks parabolic until it hit February 2007 and finally started dropping. In 4 years it rose from $40 to $95 and it is now back down to $75 (which takes us back about a year). So you are down about 20% ...so what! Housing is UP about 100% and rents are flat!

      Anyway, THIS is where you are calling a bottom? What if we get a RECESSION? Hell, even if we don't housing is likely to keep dropping!

      Finally you provide these comments without a shred of evidence to back them up. No facts or even circumstantial evidence?? What are you ...Republican?
      View article »
    • Fri Sep 7th 21:22 PM | Rating: 0 0
      Commented on:
      Real Estate: How Far, How Fast?
      Your final chart seems to indicate that there is only a 30% chance that REITs will decline in price over the next year if I am reading it correctly. I think this is way too bullish.

      I think we are in a very unusual place with RE and the markets right now. So much so that they can't be modeled very well using historical data. It's like trying to predict a Katrina event or a bad earthquake with historical data.

      Given the dizzy heights we are at on the Case-Shiller Index ...and the fact that things are really beginning to unravel ...I think it is impossible to predict anything, except down. I would predict something along the lines of a 10% chance that REITs will be higher in a year and 10% that they will get cut in half ...80% that they will be somewhere in between.

      Thanks for responding though ...I respect your opinion even if I disagree!
      View article »
    • Fri Sep 7th 03:11 AM | Rating: 0 0
      Commented on:
      Real Estate: How Far, How Fast?
      Who do you think you are kidding? Using ICF as an example, it nearly tripled in 4 years!!

      I don't care what kind of software or math you are using, but this is a bubble. The REIT charts all look like NASDAQ in 2000!

      The party is over -
      1) Property values will revert to the mean (eventually).
      2) There will be such a glut of RE out there rents will probably drop as well.
      3) Pray we don't have a recession ...then we will have huge vacancy rates.

      Anyway nice try, but I am not buying. In fact, what I AM buying is SRS (a double short against a REIT index).
      View article »
    • Wed Sep 5th 22:02 PM | Rating: 0 0
      Commented on:
      Housing Market Bad But No Longer Worsening
      Shiller rules ...you guys are fools!
      View article »
    • Tue Sep 4th 02:51 AM | Rating: 0 0
      Commented on:
      Long-Term Investors Shouldn't Heed Confused Housing Data
      Just an fyi, but Shiller is expanding his Chicago Board Futures Market on housing from 1 year to 5 years ...this month! Soon we will be able to see how deep this rabbit hole REALLY goes!
      View article »
    • Tue Sep 4th 02:47 AM | Rating: 0 0
      Commented on:
      Long-Term Investors Shouldn't Heed Confused Housing Data
      >> My point was to keep a long-term view and to avoid drawing quick conclusions from daily news that is mere noise most of the time.

      Understood ...and generally I agree. I think you just picked a really bad example, since one of the articles quoted the Case-Shiller Index.

      NAR and the government stats on housing ARE mere noise ...their methodologies are really flawed (to be polite about it).

      Shiller IS the real deal though. Using that data IS looking at the path (and not your feet).
      View article »
    • Mon Sep 3rd 16:20 PM | Rating: 0 0
      Commented on:
      Predicting Recessions: Identifying Reliable Sources
      Carlos - I don't disagree, except what you describe sounds more like depression ...I hope we don't end up there!

      Also, by the time the government does something it is generally too late. It is common for the Fed rate to follow the GDP down, since the recession is generally "baked in" by that point and there is a lag in the affect of lower rate (probably 6-12 months).

      Jeff - I think you got your answer. There are many recession indicators as the responders have pointed out. I think the bottom line is that not all recessions are the same. Some predictors are better than others depending on the cause and kind of recession. I try to triangulate ...or use more than one indicator.

      I'm amused that Economists are such bad recession predictors though. Some economists seem to get it right most of the time, but most do not. I'm not sure if it is one of the following reasons or not:
      1) Hate to be wrong.
      2) Have conflict of interest with job.
      3) Are too focussed on other economic studies.
      4) Are not well educated.

      I mean both "The Economist" magazine and the Federal Reserve studies put the probability at 30-40%, yet many Economists are so stupid they say there is virtually no chance of recession.

      There is something rotten in Denmark!
      View article »
    • Sun Sep 2nd 23:22 PM | Rating: 0 0
      Commented on:
      Predicting Recessions: Identifying Reliable Sources
      All harbingers of a recession:
      1) As noted, temp worker numbers are a good indication.
      2) How inverted the yield curve has been (3 month versus 10 tear).
      3) New home sales has generally cross the 600 million mark as we enter a recession.
      4) There are other good indicators as shown here:
      www.econbrowser.com/ar...

      All these indicators are moving in the wrong direction, though none are certain yet.

      What are poor predictors of recession:
      1) UE - it usually hits it's lowest point when the recession starts.
      2) Last quarters earnings numbers ...they can turn on a dime.
      3) Economists - They are notoriously bad at predicting recessions (and even bubbles for that matter - Shiller being the exception).
      View article »
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