Brent Ritterbeck

High End Home Market Still Has Further to Fall

While a person's house is certainly an asset, I don't think people should view it as an investment. A house is a place to live. You need it for shelter. I can understand that people bought into the housing bubble because it looked like a great way to make money, however, house flipping seemed like a bad investment to start with. There are only a little over 300 million people in this country. If you consider the average family is 3 people (two parents and a child), that means a total of about 100 million homes are needed. Does anyone have numbers on how many homes actually exist in the United States? Does anyone have numbers on the amount of homes that are destroyed (both through natural causes and standard replacements)? It would be interesting to compare the amount of homes built versus the actually need for homes.


On Jun 04 08:24 AM t-bird wrote:

> Very good article. Most people do not see nor do they comprehend
> what you are saying in this article. I have built or renovated eight
> homes over the last 32 years. From my first home in '77 @ $30,500
> to the last house I sold in '05 for $2.4M...many people felt that
> by selling real estate they were ENTITLED to a positive return on
> their investment.
>
> This as we all know now is no longer true and will become painfully
> evident to many as time passes...

Chinese Company Buys GM's Hummer

Certainly it is unclear whether or not the Chinese company can manage the assets profitably; however, I really don't see how they could do much worse than GM. Resources will flow to those who are able to use them in the best manner. GM has failed as an auto company. It will be interesting to see what this Chinese company can do with the assets.

I am not writing the Chinese off this early into the game. They are an emerging economy with a large appetite for foreign goods. By this I mean that the Chinese want to consume American goods and the Chinese want access to invest in American goods. I hope this turns well for them. China has arrived on the international stage, and they are here to stay.


On Jun 03 06:06 PM Sovestor wrote:

> The era of automotive industry as the primary driver of US economy
> is officially over now with GM bankruptcy. It is unclear however
> whether new buyers of GM assets can manage the assets profitably.
> Auto business is inherently complex, competition is fierce, and expensive
> to operate.

Will China Dump the Dollar?

Chandragupta,
Your comment is spot on. The days of the U.S. dollar being the only option for large currency reserves is over. The Euro and Yen, as the article states, are both decent alternatives to the U.S. dollar. It makes perfect sense to spread the reserves around. Diversification is a good thing.

Unlike the article, I don't think the history between China and Japan will preclude China from using the Yen as a reserve currency. China is going to become one of the top economic powers globally. It's just a matter of time. The Chinese government is making some very intelligent decisions in their economic policy, and I'm sure that the government has plans to ease tensions between itself and Japan. Using the Yen as a reserve currency might be a good way to gain some more regional clout.

On May 28 12:27 PM Chandragupta wrote:

> The question is not 'whether' China will dump the Dollar, but 'when'.
> Sure they may find they have fallen into a 'dollar trap', but supporting
> the dollar further is not going to be a solution to it. So sooner
> or later, they are going to wriggle out of it. As the recent rise
> in the prices of commodities shows, the process has already begun.

Beware of Chinese Stocks on OTCBB

Karl,
Almost every stock trading OTC and below $2 is trading that way for a reason. They have no value. Yes, occasionally small companies issue stock and trade OTC before moving to an exchange, but it's rare. On top of that, many of these Chinese companies have zero transparency. Even if I wanted to, I couldn't find out any information about a lot of Chinese companies trading OTC. This is a problem. Investors should know about what they are investing in.


On May 28 11:02 AM Karl Glazier wrote:

> Your headline makes no sense, and links don't work.
> Some companies on the OTCBB should not have come public, but that
> does not mean there are not incredible bargains to be found. For
> instance Orient Paper, OPAI.ob,, is trading at a P/E of 2,5 (2008
> earnings) and growing over 30%. Sales were $65 mill., so they are
> not that small. Why would you want to avoid a bargain like that?
>
> In addition, many OTCBB companies are preparing to transfer to the
> NASDAQ.
> Are you saying we should wait to buy until they have switched and
> share prices are trading at a more normal P/E (after prices have
> tripled?)

Bernanke Seems Clueless About the Real State of the Economy

How can anyone read this article and accept what the author has to say? People should immediately be tipped off to the fact that the author doesn't know what he is talking about by two obvious errors: (1) Bernanke's first name is not Bernard; it's Ben. (2) Bernanke said the recession may end in 2009; he did not say that it will end.

I cannot believe the level of hysteria and conspiracy theories that are running rampant through our society. The truth is people, both corporations and individuals, made bad decisions. Those bad decisions have been exposed and now we, as a collective whole, are paying for those bad decisions. There is no conspiracy theory. The government is not trying to dupe the public. There is no large, evil political agenda. This is the natural result of bad decisions. This is how an economy works out the bad decisions. This is capitalism. Get used to it.

Rick Santelli: The Best Five Minutes in CNBC History

This is not Wall Street's fault. This is the fault of Americans who went and purchased much more than they could afford. This is the fault of Americans who think that a house is an investment rather than a place to live. I am sick and tired of hearing how this is Wall Street's fault. Wall Street was in the business of facilitating commerce. There was demand, and they filled the demand. Americans were happy as long as the credit continued to flow that let them live above their means. Now they're angry because the Street shut that off. This is the fault of Americans who overextended themselves, nothing more, nothing less!


On Feb 20 07:19 AM honest mortgage guy wrote:

> I have one comment for both of you; I own a mortgage company. during
> the "go go" days, I refused to do loans for people that could not
> afford them. I made it my responsibility to "know my borrower" and
> only originate loans that they could pay back. As a result, I did
> well but nearly as well as those that practiced irresponsible lending.
> Now I see Santelli ranting on a trading floor on CNBC about the mortgage
> crisis. My income is now 40% of what it should be largely because
> of Wall Street greed. The Wall Street guy's all made their money
> and now screw the rest of us. I wonder what Santelli (and you) have
> to say about that?