Belvedere Research's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/132554/comments http://seekingalpha.com/article/100088-another-root-cause-that-isn-t-tumbling-home-prices?source=feed#comment-283806 283806
While I'm on my soapbox, in the next gen economy, it'd be swell if we'd begin to focus more on the *productivity* than the *consumption* of our economy. As painful as it may be to swallow, no country maintains wealth by leading the world in consumption. Long run wealth is measured by how much value you create and deliver to your citizens and the world. The writing on the wall came shortly after the tragedy of Sept 11th when our government's call for action was "go shopping!". This is a sure sign that we've become slaves to the consumer, their fragile confidence, and their ability to consume more than they produce. Sad...

]]> Thu, 16 Oct 2008 12:54:04 -0400
While I'm on my soapbox, in the next gen economy, it'd be swell if we'd begin to focus more on the *productivity* than the *consumption* of our economy. As painful as it may be to swallow, no country maintains wealth by leading the world in consumption. Long run wealth is measured by how much value you create and deliver to your citizens and the world. The writing on the wall came shortly after the tragedy of Sept 11th when our government's call for action was "go shopping!". This is a sure sign that we've become slaves to the consumer, their fragile confidence, and their ability to consume more than they produce. Sad...

]]> http://seekingalpha.com/article/99987-my-plan-to-repair-housing-in-america?source=feed#comment-283796 283796
IMHO, the fundamental bubble was not with housing, it was with lifestyle. The US consumer was/is caught up in an immediate gratification spiral. Any economy who lives and dies by the *consumption* of it's population rather than the *production* is doomed to fail sooner or later.

We need to take our medicine, and need to do it in a way that won't kill the patient, but the plan you (and Hubbard) outline start from the premise that the objective is to get back to the way things were - upward housing price movement, consumers that spend, spend, spend, and an economy that becomes a slave to consumer confidence. That's insanity and not something we should want to return to.

Let's start focusing 70% of our attention on the productivity side of our economy - education, training, basic R&D investment, strategic industry development, and only the last 30% on the consumption side. ]]> Thu, 16 Oct 2008 12:44:17 -0400
IMHO, the fundamental bubble was not with housing, it was with lifestyle. The US consumer was/is caught up in an immediate gratification spiral. Any economy who lives and dies by the *consumption* of it's population rather than the *production* is doomed to fail sooner or later.

We need to take our medicine, and need to do it in a way that won't kill the patient, but the plan you (and Hubbard) outline start from the premise that the objective is to get back to the way things were - upward housing price movement, consumers that spend, spend, spend, and an economy that becomes a slave to consumer confidence. That's insanity and not something we should want to return to.

Let's start focusing 70% of our attention on the productivity side of our economy - education, training, basic R&D investment, strategic industry development, and only the last 30% on the consumption side. ]]> http://seekingalpha.com/article/97300-the-truth-in-advertising-700b-means-700b-and-maybe-more?source=feed#comment-264841 264841 www.cnbc.com/id/158402...

If I was shaping policy, I'd say: do the bailout, structure the subsequent MBS deals with warrants for anything purchased over current market clearing prices (ie if treasury thinks the market is paying fire sale prices for a certain security and wants to pay above that...)


]]> Thu, 25 Sep 2008 11:31:18 -0400 www.cnbc.com/id/158402...

If I was shaping policy, I'd say: do the bailout, structure the subsequent MBS deals with warrants for anything purchased over current market clearing prices (ie if treasury thinks the market is paying fire sale prices for a certain security and wants to pay above that...)


]]> http://seekingalpha.com/article/85652-polycom-benefits-from-rising-travel-costs?source=feed#comment-211750 211750
My only question about PLCM relates to the investor relations of mgmt. This was the first webcast that I watched in its entirety and there was something "off" about the flow of the call, maybe the marginal video quality, or maybe the rah-rah spinning of all responses. Did you/anyone else walk away with this sense?

Still, I'm long PLCM and think the story is too good to pass up]]> Tue, 22 Jul 2008 15:29:47 -0400
My only question about PLCM relates to the investor relations of mgmt. This was the first webcast that I watched in its entirety and there was something "off" about the flow of the call, maybe the marginal video quality, or maybe the rah-rah spinning of all responses. Did you/anyone else walk away with this sense?

Still, I'm long PLCM and think the story is too good to pass up]]> http://seekingalpha.com/article/80933-u-s-credit-card-performance-more-deterioration-in-april?source=feed#comment-187831 187831
COF for one (I'm short w/ puts) has fallen about 20% in the last month or so, and I believe they have a ways further to fall. Issuing banks have several factors squeezing them right now:
(1) debt already on the books is much less likely to pay off than they thought when they issued. "thought" may be too generous, maybe "hoped" is a better word
(2) overextended consumers, and those who file bankruptcy etc... will (eventually) stop charging as much to their cards as they feel the pinch which bounds their profits. Admittedly, in the short term, they may charge more because they have to, but you can only spend more than you make for so long...
(3) As more consumers/voters get overwhelmed with their credit card situations, there will be more public outcry and vilification of the credit card industry for their shady double cycle billing and high APR fees. Congress will get in on the act and will pass legislation limiting the fees that card companies can charge (it's an election year after all!) and this will SEVERELY squeeze profit margins. Intuitively, I have to believe that a lion's share of card issuers' profits come from penalties and fees that could be (and probably should be) curtailed.

I'm talking my book here since I'm betting against COF, but in my opinion COF will be the CFC (countrywide) of 2008...]]> Wed, 18 Jun 2008 13:50:15 -0400
COF for one (I'm short w/ puts) has fallen about 20% in the last month or so, and I believe they have a ways further to fall. Issuing banks have several factors squeezing them right now:
(1) debt already on the books is much less likely to pay off than they thought when they issued. "thought" may be too generous, maybe "hoped" is a better word
(2) overextended consumers, and those who file bankruptcy etc... will (eventually) stop charging as much to their cards as they feel the pinch which bounds their profits. Admittedly, in the short term, they may charge more because they have to, but you can only spend more than you make for so long...
(3) As more consumers/voters get overwhelmed with their credit card situations, there will be more public outcry and vilification of the credit card industry for their shady double cycle billing and high APR fees. Congress will get in on the act and will pass legislation limiting the fees that card companies can charge (it's an election year after all!) and this will SEVERELY squeeze profit margins. Intuitively, I have to believe that a lion's share of card issuers' profits come from penalties and fees that could be (and probably should be) curtailed.

I'm talking my book here since I'm betting against COF, but in my opinion COF will be the CFC (countrywide) of 2008...]]> http://seekingalpha.com/article/81444-i-think-microsoft-is-bluffing-on-yahoo?source=feed#comment-186807 186807
Either way, Yang had better start polishing his resume...]]> Mon, 16 Jun 2008 22:15:29 -0400
Either way, Yang had better start polishing his resume...]]> http://seekingalpha.com/article/71182-the-reverse-ripple-theory-of-metropolitan-home-price-corrections?source=feed#comment-136507 136507
I'd offer one more possible reason for why. In the bay, outlying areas were the ones where subprime was the biggest factor as people who otherwise couldn't afford a house decided to accept a 45 minute or 1 hour 45 minute commute and "stretch" for that house. They're most susceptible to the jolt of foreclosures and abrupt halt of banks willing to lend. Factors leading to inner rings of the ripple lowering prices have more to do with the slow process of price discovery and inward diffusion of prices.

If a buyer was formerly willing to add 30 minutes to commuting to save $200K, they're still directionally willing to do so, and if Stockton houses drop, it's a matter of time before the next buyer looking at Stockton vs Concord, or Concord vs Freemont, or Freemont vs. Berkeley, etc... will ripple that price inward.

The other possible reason is level of speculation. Just a guess but I'd suspect more were speculating on new home developments out on the fringes than on 100 year old (and much pricier) homes in the city center. ]]> Fri, 04 Apr 2008 10:34:58 -0400
I'd offer one more possible reason for why. In the bay, outlying areas were the ones where subprime was the biggest factor as people who otherwise couldn't afford a house decided to accept a 45 minute or 1 hour 45 minute commute and "stretch" for that house. They're most susceptible to the jolt of foreclosures and abrupt halt of banks willing to lend. Factors leading to inner rings of the ripple lowering prices have more to do with the slow process of price discovery and inward diffusion of prices.

If a buyer was formerly willing to add 30 minutes to commuting to save $200K, they're still directionally willing to do so, and if Stockton houses drop, it's a matter of time before the next buyer looking at Stockton vs Concord, or Concord vs Freemont, or Freemont vs. Berkeley, etc... will ripple that price inward.

The other possible reason is level of speculation. Just a guess but I'd suspect more were speculating on new home developments out on the fringes than on 100 year old (and much pricier) homes in the city center. ]]> http://seekingalpha.com/article/66391-housing-prices-are-still-headed-down?source=feed#comment-120018 120018 Thu, 28 Feb 2008 01:13:46 -0500 http://seekingalpha.com/article/66235-intel-s-plan-to-bring-personal-computing-to-the-masses?source=feed#comment-119818 119818 Wed, 27 Feb 2008 14:10:16 -0500 http://seekingalpha.com/article/66076-zoran-riding-the-consumer-electronics-wave?source=feed#comment-119815 119815
That said, the consumer spending slowdown does give me concerns about such a gadget focused silicon player.]]> Wed, 27 Feb 2008 14:04:12 -0500
That said, the consumer spending slowdown does give me concerns about such a gadget focused silicon player.]]> http://seekingalpha.com/article/66128-latest-case-schiller-report-shows-the-sky-is-falling?source=feed#comment-119807 119807
www.housingtracker.net...

For a good (albeit 5 months out of date) set of affordability stats on 50+ markets. It's pretty clear that some markets are working thru a short term pricing reset, while others have a huge headwind of fundamentals that'll likely be blowing for 5+ years.

Even if you believe that LA/SF have fundamentally changed so that now paying 50 or 60% of income for mortgage payments is going to continue to be the new reality (I highly doubt that, by the way) that means the real estate market would only grow at the rate of wages going forward (i.e., no 10-15% per year upside anymore!). ]]> Wed, 27 Feb 2008 13:47:37 -0500
www.housingtracker.net...

For a good (albeit 5 months out of date) set of affordability stats on 50+ markets. It's pretty clear that some markets are working thru a short term pricing reset, while others have a huge headwind of fundamentals that'll likely be blowing for 5+ years.

Even if you believe that LA/SF have fundamentally changed so that now paying 50 or 60% of income for mortgage payments is going to continue to be the new reality (I highly doubt that, by the way) that means the real estate market would only grow at the rate of wages going forward (i.e., no 10-15% per year upside anymore!). ]]> http://seekingalpha.com/article/66215-case-shiller-steepest-price-decline-on-record?source=feed#comment-119798 119798
www.housingtracker.net...

Not academic, but a very clear summary of what you're talking about. It's clear that some metro areas are in a shorter term downcycle from a wave of foreclosures and illiquidity (e.g., Detroit) while others are in for a longer term fundamentals-based downcycle (e.g., LA, SF). Remember that in LA in the early nineties, prices got out of touch with fundamentals and stayed underwater in some areas for almost a decade]]> Wed, 27 Feb 2008 13:38:11 -0500
www.housingtracker.net...

Not academic, but a very clear summary of what you're talking about. It's clear that some metro areas are in a shorter term downcycle from a wave of foreclosures and illiquidity (e.g., Detroit) while others are in for a longer term fundamentals-based downcycle (e.g., LA, SF). Remember that in LA in the early nineties, prices got out of touch with fundamentals and stayed underwater in some areas for almost a decade]]>