158 replies to this topic

[TheAnk]

Obama killing McCain on healthcare.. McCain killing Obama on foreign policy.. McCain is a LITTLE too high on vets for the average joe.. Here's an honest question.. Obama is half white, half black.. Multiracial. Its very insulting to me that he doesn't admit/adress that.. It casts a huge could over bi-racial people.. Its kind of sickening to me actually..

After that debate, its my opinion that neither one of them have any clue about economics.. Which, is pretty much my only issue..

Does anyone else drink to watch debates???  

[RestedTraveler]

TheAnk, on Sep 26 2008, 10:41 PM, said:

Obama killing McCain on healthcare.. McCain killing Obama on foreign policy.. McCain is a LITTLE too high on vets for the average joe.. Here's an honest question.. Obama is half white, half black.. Multiracial. Its very insulting to me that he doesn't admit/adress that.. It casts a huge could over bi-racial people.. Its kind of sickening to me actually..

After that debate, its my opinion that neither one of them have any clue about economics.. Which, is pretty much my only issue..

Does anyone else drink to watch debates???  

What I find fascinating is that neither candidate really addressed what I feel is the real problem with the mortgage/foreclosure crisis:  the loans (No Income Verification, No Asset Requirements - NINA and other such loans).  Sure, there was a huge pool of global money with investors looking to invest it in high rates of return and these large brokerage firms that the government is considering bailing out sought to buy mortgage loans to back securities which attempted to meet this global demand; however, they're not the real problem.  The problem was with these mortgage companies that continued to relax their criteria for loan qualification to the point that they began to issue loans to people to whom they shouldn't have - simply to meet market demand out of greed.  There should definitely be some regulations put in place to prevent such loans from ever beingn issued to someone who hasn't even as much as a snowball's chance in hell of paying it back.  Of course, the mortgage issuers aren't the only villain here.  The brokerage firms continued to buy these NINA loans in spite of their higher than average risk and then mixed them in with other lesser risk pools of annuities and sold them to investors with higher ratings.  They're guilty too, and some regulation is needed to prevent this as well.  I suppose Obama really touches on regulation better than McCain, so I'd have to give him the edge.

As for Obama's multiracial background, he freely acknowledges it, but doesn't harp on it.  Just this evening on ABC 20/20 before the debate, a very biographical piece (similar to ones we've seen before) was done on each candidate.  Obama struggled with his multiracial status throughout much of his early life it seems...and given the era in which he grew up, it's understandable.  Then, he finally began in college to grow into his own identity.  I have to respect that.  I suspect many multiracial/biracial people from the same era get it.  It's not anything he has to address.  It is what it is and he is who he is and he's very comfortable with it...as should anyone be comfortable with who they are...and I see no reason to be sickened by simply being who you are and being proud of your roots without constantly flaunting it by reminding people that you're multiracial to start every interview or speech in the same way McCain constantly reminds people that he was a POW.

I don't drink to watch debates, myself...

Edit:  Oh yea - one thing I forgot to say ... McCain is really high on Veterans, but they sure aren't too high on him if you look into it enough.  I find that extremely odd.  Seems they're mad at him for cutting their benefits and for blocking the release of classified POW/MIA records back in the early 1990's and other things.  I'm not a Vet, so I don't quite get it, but if they're mad at one of their own, it speaks volumes...and he still claims their support?  Seems like pure spin.  I'm surprised they haven't swift-boated the guy by now.

Edited by RestedTraveler, 26 September 2008 - 09:48 PM.

[TheAnk]

My gripe with McCain is he comes off as a crazy war guy.. I guess understandable with him being a POW. But where there's smoke......

My (personal) point on Obama is be proud of who and what you are.. I feel he is running as a "black" candidate, when he is multiracial.. The future of the world as a better place, in my opinion, is to promote interracial relationships, and he fails to be the advocate he should be.. I don't expect people to agree, but thats just my personal take.. And 10000% unrelated to foreclosures and financing, for sure..

So to bring this back to topic, the bailout is the single biggest crime in american history..

[pete11]

TheAnk, on Sep 26 2008, 07:46 PM, said:

This debate (on TV) is fascinating.. Lets call it Who Can Distance Themselves From Bush Better... Also, its far more heated than any one I can remember..

Housing already (at least in my foreclosure striken area) is well below the ratios.. We are already way beyond the rational on the downside.. The problem, I'll admit.. Is lending.. Its very tough to get a loan.. Investor, impossible...

I hear that is going to change come Jan 09.. Rumor says changes to FHA will welcome investors by allowing multiple loans.. Right now, anyone at any time can only have one fed guar loan..  

I think, its time they stopped shutting investors out.. We can provide a much needed backstop to the lack of buyers for foreclosures.. It may not be the best thing for home ownership, but its certainly a rational business model for these festering properties..

Thoughts?

The money's not there. We are already borrowing more money than we could ever pay back, to just begin to clean up the current mess. The misconception is that the Fed cares about home prices. By the treatment of the common shareholders, and bond holders of the recently failed companies, asset prices are not of concern.

You're right real investors will come out at some point (ain't capitalism grand?) but trust me, if there's even a hint that recent real estate "investors" can still get any cash, they will remain on the sidelines.

The real vultures pay cash, and don't compete with these mouth-breathers.

[frymasterspeck]

If there's all this cash amassed in hedge funds sitting on the sidelines and these mortgage derived securities are so grossly undervalued, then what's the low-down on the slow-down? It's not like Lehman and Bear and Merrill WOULDN'T sell. They COULDN'T sell. The market is, literally, seized.

There is no first buyer, hence this 'bail-out.' Disabuse me...

[pete11]

frymasterspeck, on Sep 27 2008, 09:25 AM, said:

If there's all this cash amassed in hedge funds sitting on the sidelines and these mortgage derived securities are so grossly undervalued, then what's the low-down on the slow-down? It's not like Lehman and Bear and Merrill WOULDN'T sell. They COULDN'T sell. The market is, literally, seized.

There is no first buyer, hence this 'bail-out.' Disabuse me...

I think I understand the question. The thing is that its not a question of liquidity, but a question of solvency. These hedge funds were even more levered then the banks.

When the next quarterly statements go out, we should see an avalanche of redemptions. That was why you saw all asset classes being sold off last week. Hedge funds trying to remain solvent. (cash to meet the increase in redemptions)

October's fireworks should be cool,

As for the undervalued MBS'

One aspect of Sunday @ 5:00 "last minute compromise" will be that these will be bought at discounted cash flow, they will be able to spin to joe 6 pack that this is a fair model.

The reason that no one else is buying at this valuation is future negative HPA (home price appreciation) which is certain, but the uncertainty of its depth.


The negative HPA comes from JPM's buyout of WAMU's assets, I like the term so I stole it.

Edited by pete11, 27 September 2008 - 01:13 PM.

[frymasterspeck]

Looks like we're setting up for a bloody day. Are markets rejecting the plan OR selling the news, having bought the rumor on Thu/Fri? I think the latter.

[TheAnk]

"Every member of Congress and every American should keep in mind - a vote for this bill is a vote to prevent economic damage to you and your community," Bush said.


Sound familiar to anyone?

[Frankie811]

The mail keeps coming, long after the residents are gone.  Grocery store circulars, water bills, medical bills and notices from loan-servicing companies addressed to houses the postman knows are vacant.  In zip code 02907 of the city’s West End the house-foreclosure rate is more than six times the statewide average.

[Frankie811]

Providence vigil calls for moratorium on foreclosures. Singing “We Shall Not Be Moved” in English and Spanish, about 15 people holding a candlelight vigil last night called for a moratorium on foreclosures.

[jencoleslaw]

Only 15? That's not a very powerful message.

[Frankie811]

Web site documents Providence’s abandoned houses. Sam Holland, a Web designer, and Myles Dumas, a graphic designer,  is hoping to build a grass-roots campaign to tackle the problem of foreclosed, abandoned and vacant houses. Their Web site combines photographs of boarded and abandoned houses with links to property data.

http://www.projo.com...70.3185a12.html

http://www.forgottenprovidence.com/

[TheAnk]

Frankie811, on Apr 10 2009, 12:37 AM, said:

http://www.forgottenprovidence.com/

Cool site, great pics.. I actually think Olneyville is markedly improved as far as forecs.. The boarded up houses are turning over, it "feels" better.. The worst wave was tough to deal with for sure..

In Foreclosure News:
http://makinghomeaffordable.gov/

For the most part, its smoke and mirrors; as always, our government can't do anything right.. Most people who need help are people who hold mortgages with ARMs. People also who need help most likely put down less than 20%..

Unfortunately, those types of mortgage cannot be helped.. Hilarious.. Because both loans typically have a second lien (meaning you get one loan for 80% LTV, and a second to make up the difference in down payment say you put down 5%, you'd get a second for 15%) the second lien holder, of course rejects the program unequivocally.. They have the most to lose, so of course they don't want any part of it..

Does anyone else find this completely fascinating? There's only two scenarios possible:

1. People in government are so uneducated about finance that they did not know most at risk loans have a second lien and are only in government because there is no accountability so you can be a retard and incompetent and never get fired

or

2. The program is designed purposely to not help people at all, and only serve as Bla Bla Oblablama empty talk for "helping the people"..

In more positive news:

For those of you with FHA loans.. You can streamline that loan to a lower rate (under 5%). The problem is closing costs, which can be uh.. costly.. But if the rate reduction is enough, it can be worth while.. Of course, you start the 30 year clock again, which sucks..

So one government program is a collosal failure, another is pretty damn good..

Thing that I think but have very little factual information about other than I'm usually right:

The perception of acquiring foreclosures and shorts seems to have changed with the ordinary folk.. People are much more willing to step into these situations than before.. This change, combined with the perception that housing is now a "good deal" signals the sure bottom.. Add in cheap financing and the economy set for a rebound, and in my opinion, it is over..

Its been roughly three years since peak (2006), a horrific drop in prices and perception.. There is a big glut of forecs that need to turn over, this is true... But when you start seeing non-shorts and non-forecs in the sales, its too late.. The time to buy is now, before that happens..

TheAnk is bull now on everything; stock market, housing, economy, employment.. When it is the worst, or what appears to be the worst.. Its the best to buy.. Even the new stories are trickling in with guarded optimism.. The bear is over, the bull has started

[TheAnk]

There is also literally, no supply of multifamilies in Providence.. Its basically evaporated..

Date        PVD Multi RI Multi 3Fam PVD 3Fam State
09/21/2007 774 1928 349 711
10/22/2007 785 1901 355 698
12/27/2007 717 1738 340 662
03/11/2008 702 1702 305 612
06/16/2008 693 1685 297 593
09/02/2008 638 1567 248 518
10/06/2008 577 1463 216 463
12/29/2008 493 1320 194 441
02/09/2009 476 1239 190 423
04/30/2009 368 1044 155 323

So I guess there is a little bit of fact behind my unrequested, unproven and unreliable opinions on housing...

Eyeballing these listings, most of these are still foreclosures, but the tide is changing.. There are an icreasing number of "real" listings, which means the foreclosure wave, at the very least is taking a pause, and at the very best is over...

[The Voice of Reason]

The Ank,

you are dead right about the bull.

I think and this is just a guess, because poop can still happen, but I think we will generally look back at this recession and call the first week of March the bottom.  I'll say March 6th, because thats when it turned arround for my 401k  
I am up 161% since that day and will likely top 200% by todays close.

The thing with property is that entry level homes have never stopped selling.  and forclosed homes came in at entry level prices.  It will be interesting to see when mid level homes start selling again.  there is a ~6000 SF mansion on 3.5 acres near my house(Manchester, CT) for sale at only 350K right now.  It is deals like this that will start pushing the market.
there was an extremely nice condo downtown(hartford) that was listed at 220K.  220K for a 1,450 SF condo in a historic building with a nice view and walk to work downtown(it was in the Linden building on the top floor)  It sold quickly

these are the kind of deals that start to move the market because the buys have to sell their existing home and it really starts to make the market move.

furthermore if you look at my credit thaw thread in the main coffee house forum you will see that some of the capitol market indicators are heading the right direction.  I work in the money markets and fixed income settlement operations and I can say that things are changing.  deals are being done.  there is a ton more pain for a lot of people out there, but the leading indicators are all green right now.

so buy whatever you can.
I just wish I was more liquid because when GE was at $7 I had a stiffy
I bought by rental property about a year ago now, and it has not really lost value, but there are some deals out there that also give me a stiffy.

too bad I am not in a position to take advantage of this recession.  maybe I will have some assets by the next one.

Cheers!

[monsoon]

Short term views of the stock market (anything less than a year) is basically nothing more than gambling.   Any piece of news can cause a dramatic change and unless one is willing to work with unpredictable odds, then I don't recommend it.   The market is up since March.  I don't think it is any sign at all that the economy is improving.   It's a sign that corporations have improved their bottom lines at the moment by firing people during the first quarter.  Is it sustainable in the long run?  I don't think so.   This economy won't recover until they admit what the real problems are and address them.  

One thing to consider.   Suppose something like a stock was worth $100 in October and was worth $10 in March.  It lost 90 dollars which is a 90% drop.   Easy enough.   Now suppose that stock rises 90% from March to now.  That is only a rise of $9.  Much much less than the original fall $9 vs $90 even though both sound the same.   This is how the media reports it.

[TheAnk]

The dow dropped 53% from its highs... If it goes back up there it will be a gain of 106%.. Thats how percentages work, we all learned this in 3rd grade math.. Thats not what is being discussed.. We are not talking about mathematic semantics, we are talking cyclical markets..

Here's something for you to consider.. The dow started in 1896 @ 40.94..
Today it is trading at 8,200.. (after shedding roughly 40% from 14,000)

The Dow has been around for 113 years; at any moment in time you can point to a past moment in time and show both gains and losses..

Markets are cyclical, and they just shed 50%.. We just experienced a gigantic loss.. And most people are, rightly so, fearful..

I'm just saying what I see.. We had a viscious bear market correction, 2nd only to the GD.. And the Depression didn't have the "benefit" of a fiat dollar to stop it, or securities laws, for that matter...

Or a drunken sailor president who spent more than all prior presidents COMBINED (from George Washington to George Bush) in thirty days.. (And last night, comically stated that he wants a lean portfolio and small government LOL)

Conditions are stabilizing, leading indicators are improving.. Most people inveitably miss the bull from fear and ride out the bear too long out of stubborness.. Its human nature

Legalese Disclaimer: All investing is gambling... Its like craps in a casino.. Either you are willing to assume the risks of investing, or you are not.. There is no such thing as a safe investment.. If you are not willing to lose, don't invest in anything.. There's nothing wrong with that..  Except for the fact that you can't beat inflation and your dollar is worth less every day, but whatever..

[TheAnk]

http://www.projo.com...21.30ac6d1.html

Timely article..    

[The Voice of Reason]

monsoon, on Apr 30 2009, 10:14 AM, said:

Short term views of the stock market (anything less than a year) is basically nothing more than gambling. Any piece of news can cause a dramatic change and unless one is willing to work with unpredictable odds, then I don't recommend it. The market is up since March. I don't think it is any sign at all that the economy is improving. It's a sign that corporations have improved their bottom lines at the moment by firing people during the first quarter. Is it sustainable in the long run? I don't think so. This economy won't recover until they admit what the real problems are and address them.

One thing to consider. Suppose something like a stock was worth $100 in October and was worth $10 in March. It lost 90 dollars which is a 90% drop. Easy enough. Now suppose that stock rises 90% from March to now. That is only a rise of $9. Much much less than the original fall $9 vs $90 even though both sound the same. This is how the media reports it.

fine and good monsoon, but this is in fact the beauty of the stock market.  It is in fact a confidence game.  if people get scared, they get out.  if people get out stocks fall.  regardless of profits etc, peoples confidence in stock is what drives the market.

a perfect example is Lehman brothers. LEH was profitable when it went under.  People lost confidence in the industry and were getting out, then Lehman was identified as the "weakest" in the sector, so its stock was hit hardest.  not because it was any worse off than Goldman Sachs, but because it was targeted by a lack in confidence that focused on it.  

so, in the last 2 years say, the market in general has lost 90%  (for example sake) and during this process trillions of dollars were taken out of the market and placed in traditional bank accounts for safe keeping (as evident in the increase in deposits at commercial banks) that is fine and good.  we have a bad ass fincancial crisis on ourt hands right.  well now that the damage has been mostly done things settle out, and some of the more risk advers get back into the market in blue chips first and then other more risky companies.  the market now rises 90% over the last 2 months.  people who got that 90% are psyched.  people that did not are now wondering why their money is sitting in a savings account at Bank of America earning .01%  
some of those people will take the positive sounding 90% return news coming from the media and get a stiffy like me and invest tentitively in the markets again while mostly staying safe.  the addition of several billion to the equity markets drives the S&P higher and over the next quarter we get another 90% increase.  
sure the value is still just 37% of what it was back in october, but now lots of people feel like they are missing the boat and the process accelerates.

this is how out markets work man.

it is irrelevent what some loser paid for a stock back in October.

If I bought on March 6th I am a rock star.  if I could buy more now I would.

I am not talking about day trading here I am talking about getting on board with the market shifts.  if you were one of the lemming jumping behind the market because it has been kicking butt for 5 years and you have lost your shirt over the last 2 years, I am sorry, but not entirely sorry.  it is buyer be ware.  if you buy low sell high you win.  the market is currently at generational lows in terms of value.  so buy.
buy stocks
buy land
buy houses
only if you can afford it and you can handle the risk.

I bought some GE shares a while ago when I thought it was near bottom.  I was wrong and they re still under water.  but I planned on spending the money and holding those shares literally to pay for my future unborn childerens college.  so am I upset that I misjudged the bottom on GE?  yes, but am I upset that I bought the shares.  no,  or at least ask me in 25 years.  

I seemingly correctly judged the apparent bottom of ING shares, and so you win some you lose some.

the point is that in general you have to seriously look for value in this market.  it is not moron proof, and honestly I hope morons loose money.  They likely also bought a house they could not afford and were hoping to flip it in 2007.
the market was so moron proof over the last several years that people were bound to loose money.

shares of companies with emotional values often trump shares of companies with sound financials
do not ever pretend that the stock market is ever more than a popularity contest with a financial aspect.

being concerned with the real problems and addressing them is commendable, but the market does not care about them.  it cares about appearance.  look at how porkbellies dropped because of swine flu.  the two are completely unrelated in reality, but the perception is enough to change billions of dollars.  you can say its too risky I say its too tempting not to be a part of it.  but be contrarian.  if you like a stock wait for it to have a bad day.  do not buy DNDN now that it bounced 100%  hell never buy a drug company because of an FDA approval, but seriously if you are conciding buying a company like Aetna Insurance (AET) watch it for a bit research it and then when the time is right buy it.  After posting earnings yesterday the stock skunked because of increased costs.  It dropped over 10$ there is always a bounce back the next day, no matter how bad things are there is a bounce back.  Catch the stock before the bounce back(only if you still like the company) and wether you are in short term mid term or for life, you at least start off by buying it at a discount because people got over ambitous in selling the day before.  AET is up .46 right now.  
I am not saying buy Aetna, it is a huge risk with the potential socialization of helthcare looming, but if there is a company you know and it has a banner day, you likely should not buy it that night.  wait till it has a bad day.  everyone has a bad day.

so many people lost life savings over the last 2 years, I am just saying if they want to re-coup any of those losses they need to get back in NOW.  or 2 monts ago.

it makes no sense to be in while your getting beat up and stay out when you can win.