25 replies to this topic

[Telmnstr]

Is anyone else excited? We might actually see proper home prices again in the near future! Young people will be able to buy (with the proper down payment and income) a place to call home without overpaying into a speculative mania!!!

Could be good for America! We'll see the stock market return to proper values, housing will be proper values, and with any luck maybe a bunch of white collars in prison!

As you can see, our lying politicians tried to say that the country would fail if the bailout wasn't passed. This whole "keep people in constant fear" is a technique used by different groups (politicians with terrorism, churches with myth of burning in eternal hell, etc.). The fear thing seems to be a good age old tactic (see Adam Curtis's Century of the Self).

Anyways ... I'm saying what is happening in the economy isn't bad. Ill gotten gains need to be given back, and people need to dethrone these people that are ruining our country.

[PeninsulaKiddo]

I think the bailout is a heinous insult to a Capitalist, republican society (little "r" - republican, as my GOVT prof likes to emphasize)... but I think it was politics that prevented cowardly politicians from passing it today.  The rebound in the market was merely making up for yesterday; yesterday was deliberate, investors sold off what they had in a massive way to tell Congress how they feel.  With $1.2 trillion in lost market values in a few hours, that's quite a message.

The problem with the state of affairs is that it isn't like hitting a "reset" button Tel - no one knows what's going on.  I'm being literal - NO ONE, not Ben Bernanke, not George Bush, not John McCain, nor Barack Obama - knows how to fix this problem, or even the extent of the problem.  $700 billion is a modest estimate of the problems.  The thing is, as the big companies fail one by one, they sell off their assets in 'bundles' to foreign investors and to other industries, like retirement fund companies.  This splits up the good and bad mortgages at random; no one knows when they buy a "bundle" if it's full of good or bad mortgages until the first or the middle of the month; then suddenly (like around September 15-18) companies go under because they got a large number of bad mortgages - no one paid them, so you lose billions overnight.

This is a global problem; yesterday, Commerzbank lost 1/4 of its total value (it wasn't nationalized as NBC reported - the dumba!!es) - that is not insignificant.  Speculative buying and overabuse of credit lines extend well beyond our borders.

This little 480 point rebound today isn't going to magically reset everything.  It does not indicate that "the fundamentals of our economy are strong." (GAG ME)  It indicates that investors and stock brokers are still pissed as hell, and the problem has not been fixed.  It is going to get worse until it is resolved and - like it or not - a bailout is the way to do it.  Unless one of us here is somehow magically an economic genius the likes of which the world has not seen since Adam Smith, we're at the whims of Congress (God help us all).  If we could somehow "un-bundle" these mortgages, separate the bad from good, and keep the essentials moving in the credit markets, we'd be fine.

But right now, we don't have the cold hard cash to do so.  (where we = America)  We're somewhere between $9.5-10 trillion in debt; what's another $700 billion..........

This makes me sick to my stomach.

[vdogg]

If it means you'll stop posting about the bubble, then yes i'm very excited. In the short term, no i'm not excited at all. A lot of people are in for a lot of pain and many will lose their jobs. I have no desire to see a redux of the Great Depression and I think it's a steep price to pay for lower housing prices. That said, what I think is irrelevant because it's happening now and nothing, not even a bailout, can stop it.

[vaceltic]

Telmnstr, on Sep 30 2008, 12:54 PM, said:

Is anyone else excited? We might actually see proper home prices again in the near future! Young people will be able to buy (with the proper down payment and income) a place to call home without overpaying into a speculative mania!!!

Could be good for America! We'll see the stock market return to proper values, housing will be proper values, and with any luck maybe a bunch of white collars in prison!

As you can see, our lying politicians tried to say that the country would fail if the bailout wasn't passed. This whole "keep people in constant fear" is a technique used by different groups (politicians with terrorism, churches with myth of burning in eternal hell, etc.). The fear thing seems to be a good age old tactic (see Adam Curtis's Century of the Self).

Anyways ... I'm saying what is happening in the economy isn't bad. Ill gotten gains need to be given back, and people need to dethrone these people that are ruining our country.

Here Her Tel! Im 27 and still haven't been able to buy my first home yet! Bring those prices down BABY!!!!

[rusthebuss]

I really doubt the prices are going to go down like you think Tel

[scm]

rusthebuss, on Oct 2 2008, 04:02 PM, said:

I really doubt the prices are going to go down like you think Tel

Rus -- that has always been Tel's mistake -- gleefully, and mistakenly, extrapolating national trends onto home prices in Hampton Roads.  Never had the overbuilding, never had the speculating, never had the flipping here, that was endemic in SoCal, Las Vegas, and South Florida.  He will most certainly miss about the first 20-25% of the inevitable upturn in home prices, in the only place that counts -- where you are living.  He will be a slave to those national websites, with national trends, and miss what happens right in his own back yard.

[Telmnstr]

scm, on Oct 5 2008, 10:29 AM, said:

Rus -- that has always been Tel's mistake -- gleefully, and mistakenly, extrapolating national trends onto home prices in Hampton Roads.  Never had the overbuilding, never had the speculating, never had the flipping here, that was endemic in SoCal, Las Vegas, and South Florida.  He will most certainly miss about the first 20-25% of the inevitable upturn in home prices, in the only place that counts -- where you are living.  He will be a slave to those national websites, with national trends, and miss what happens right in his own back yard.

We had a 100% gain in values in Virginia Beach, and the median home prices are still way above what the median incomes can properly afford. We had lots of speculation (Didn't you see the news article about the one company that had 150 - 200 properties?). I went with a friend when he was looking at 6 plexes and he was running into flippers all over the place. Hampton Roads is *not* different. Don't let the realtors tell you that. The realtors have a reason why every region in the USA is immune.

There is lots of oversupply, especially in the $400K+ homes. And now no shady financing to enable people to buy them. What's going to happen to all of that inventory?

The new bubble seems to be apartments. Luxury apartments. There is no shortage of people looking for $1600/month for the condo they overpaid for. Now they get to feel the large companies.

Last figure I heard is there is 18 million empty homes in the USA.

Also, all this damage to the economy was predictable, and perhaps calculated. You saw my posts. I've been following it for 4+ years. Unfortunately with the gov't manipulating things it makes it a bit risky to try to profit from things blowing up. You never know who the gov't is going to help.

Edited by Telmnstr, 06 October 2008 - 03:31 PM.

[scm]

Telmnstr, on Oct 6 2008, 05:29 PM, said:

We had a 100% gain in values in Virginia Beach...

Actually, over a ten year period, we had a 155% increase.  In a vacuum, that is eye popping.  But where your analysis is flawed, is what has happened in the downturn?  Over the last year, VB is down 4% (based on actual sales).  In contrast, CA is down 22% -- some neighborhoods in San Bernardino county (home of the most rampant speculation) are down 31%.  Henderson, NV -- center of the Las Vegas overbuilding -- down 17%.  I have seen a "land rush" RE environment -- nothing of the sort happened here, and the relatively small fall off in values is proof.  That "one company that had 150 - 200 properties"? Slum lord scam, dedicated to ripping off investors, so don't try to make something out of nothing.

Your mistake, Tel, is looking at your home as a store of value.  Has always been a mistake, will always be a mistake.  Your determination to be right will cost you 20-25% in appreciation, because you are trying to time the market to a gnat's *ss.  Find a place you like, can afford, buy it, and keep it for 20 years.  You won't go wrong.

One other piece of unsoliticted advice?  All that time you spend here, and on the VP, you might think about spending on more "important" pursuits.  One is your job - the other is #2 on most guy's lists.  If you don't understand, Rus can explain it to you, I am pretty certain.

[Telmnstr]

scm, on Oct 7 2008, 09:17 AM, said:

Actually, over a ten year period, we had a 155% increase.  In a vacuum, that is eye popping.  But where your analysis is flawed, is what has happened in the downturn?  Over the last year, VB is down 4% (based on actual sales).  In contrast, CA is down 22% -- some neighborhoods in San Bernardino county (home of the most rampant speculation) are down 31%.  Henderson, NV -- center of the Las Vegas overbuilding -- down 17%.  I have seen a "land rush" RE environment -- nothing of the sort happened here, and the relatively small fall off in values is proof.  That "one company that had 150 - 200 properties"? Slum lord scam, dedicated to ripping off investors, so don't try to make something out of nothing.

Your mistake, Tel, is looking at your home as a store of value.  Has always been a mistake, will always be a mistake.  Your determination to be right will cost you 20-25% in appreciation, because you are trying to time the market to a gnat's *ss.  Find a place you like, can afford, buy it, and keep it for 20 years.  You won't go wrong.

One other piece of unsoliticted advice?  All that time you spend here, and on the VP, you might think about spending on more "important" pursuits.  One is your job - the other is #2 on most guy's lists.  If you don't understand, Rus can explain it to you, I am pretty certain.

155% increase, with little to no increase in salaries... yea that's stable. And the majority of the high paying jobs come from gov't positions, yea that's stable #2. People keep pointing to the fact that these other areas are down more. They went up first, so they are earlier to fall. Don't forget, Hampton Roads people are copycats. Unoriginal. They follow other people. So it will take longer to play out, but yes this area will follow the other regions. Northern Virginia is down, and their economy up there is stronger.

Yes you have lots of Navy people here, and many of them will rush out and try to buy a home even though they will have to sell in 2 or 4 years. But without subprime financing, I'm willing to bet lots of sales won't happen. Yes, I know the gov't interferes with the market with things like FHA, but well... we still have to give back all of those gains since 2001.

As far as timing the market, while many of my friends are here it is kind of a tough decision. I love the company I work for, but eventually it will be time to find a new job and there isn't a great choice. So in this regards northern Virginia is more attractive. I have creative and tech savvy ideas but no one in the region is motivated to take advantage of the talent. The region is pretty much dominated by old people who don't get it, and there isn't much you can do to change it rapidly.

We'll see. So far I've been right. 3 or 4 years ago people thought I was crazy. 2 or 3 years ago when I used to wear my Mr. Housing Bubble shirt people didn't understand it.

And yes, if the gov't continues with all the bailout stuff, the appropriate action might be to buy then immediately let said property go into foreclosure to get gov't handouts, cram downs, etc.

In the end though, the young people who are getting screwed over by all of this should revolt.

[scm]

Telmnstr, on Oct 9 2008, 01:34 PM, said:

155% increase, with little to no increase in salaries...

Once again, wrong.  1999 VB average HH income -- $48,442  2006 VB average HH income -- $59,520.

[Padman]

Ok.  I'm excited, as in terrified.  I can't ever retire and I guess I have to grow my own food and maybe learn to perform minor surgery on myself.  

Seriously though, this whole problem really isn't about housing and I'm concerned that so many people still think that it is.  The real issue is the nature of our mode of production.  We have squandered trillions of dollars in a series of marginally productive pursuits, ranging from ill advised warfare strategies to highly levereged property schemes.  Why won't the banks lend, even with all this new governmental assistance?  Why would they?  There's no viable substitute yet for the economy of the last 15 years.  I'm convinced that we need a contemporary equivalent to the old WPA of the 1930s, but with lots of free market participation.  Construct offshore wind and tidal energy farms, build electric personal vehicles, rebuild the national infrastructure and create a national, rapid rail system.  Improve solar panel efficiency and make the new technology available to everyone.  These activities will create thousands of jobs, get us off of imported oil and give us some workable transportation alternatives.  Now that would be something worthy of investment.

[scm]

Padman, on Oct 10 2008, 10:34 AM, said:

I'm convinced that we need a contemporary equivalent to the old WPA of the 1930s, but with lots of free market participation. Construct offshore wind and tidal energy farms, build electric personal vehicles, rebuild the national infrastructure and create a national, rapid rail system. Improve solar panel efficiency and make the new technology available to everyone. These activities will create thousands of jobs, get us off of imported oil and give us some workable transportation alternatives. Now that would be something worthy of investment.

Padman, I am so with you.  Had lunch with a friend yesterday.  Both of us are really fortunate -- employers pretty well immune to the economy, large expenses of life are behind us.  Prime targets for Obama's promised tax increases. Didn't see a penny of the last stimulus package, and now Nitwit Nancy wants another $150B to hand out.  I told my friend, I don't have a problem paying more taxes than anyone else, as long as we get something in return.  If we take $150B to put people to work, rebuilding our national infrastructure, then I am all for it, and will gladly pay.  But I will be damned if I will stand by and see my money go so someone can buy a $400 iPhone made in China.  Complete BS.

[Telmnstr]

scm, on Oct 9 2008, 08:47 PM, said:

Once again, wrong.  1999 VB average HH income -- $48,442  2006 VB average HH income -- $59,520.

Inflation runs at 3% (reported).

Not to dispute, but I bet a bunch of the income in Virginia Beach was derived from the housing bubble, which has ended, which means they don't have their huge income anymore.

Remember the Pilot article about Granby Tower? I do. I remember the people they interviewed that were buying them. The young professionals. The mortgage brokers.

Fast money is gone.

[Telmnstr]

Padman, on Oct 10 2008, 10:34 AM, said:

Ok.  I'm excited, as in terrified.  I can't ever retire and I guess I have to grow my own food and maybe learn to perform minor surgery on myself.  

Seriously though, this whole problem really isn't about housing and I'm concerned that so many people still think that it is.  The real issue is the nature of our mode of production.  We have squandered trillions of dollars in a series of marginally productive pursuits, ranging from ill advised warfare strategies to highly levereged property schemes.  Why won't the banks lend, even with all this new governmental assistance?  Why would they?  There's no viable substitute yet for the economy of the last 15 years.  I'm convinced that we need a contemporary equivalent to the old WPA of the 1930s, but with lots of free market participation.  Construct offshore wind and tidal energy farms, build electric personal vehicles, rebuild the national infrastructure and create a national, rapid rail system.  Improve solar panel efficiency and make the new technology available to everyone.  These activities will create thousands of jobs, get us off of imported oil and give us some workable transportation alternatives.  Now that would be something worthy of investment.

The whole thing was a credit bubble. In addition to this, I totally agree. It's bizarre to me that people who do so little are so heavily rewarded. The really high ranking CEOs that spend all day at the golf courses (Not the smaller companies), and the wall street types that make millions and billions in transaction fees basically. Same with the banks, their customer service is horrible and the fees are high. Everyone forgot who the customer is. Our leaders sold us out. Short term profits for them while everyone suffers in the long run.

As far as WPA, I would really like to see coast to coast and north/south maglev lines. Trains that do 250MPH sustained over long distances. Use electricity instead of JP7 jet fuel. Maybe put the whole thing underground, but elevated is probably a better bet.

[Padman]

Either maglev or electric could do the trick.  The French have achieved near maglev speeds using their newest electric systems, at a much lower cost.  But there might be some breaktroughs with maglev to come, and along with some economies of scale, maglev might compete better with the airlines.  Either systems require lots of very straight right of way to attain maximum speeds.  That will be a challenge along the eastern seaboard--lots of real estate to buy up.  Another interesting factor with regard to air travel: synthetic fuels don't provide enough kick to give comparable performance to conventional jet fuel.  For now, it looks like rail is a more sustainable technology.

[scm]

Padman, on Oct 14 2008, 11:03 AM, said:

The French have achieved near maglev speeds using their newest electric systems, at a much lower cost.

The French hit 350 MPH in Spring, 2007 on the new TGV line between Paris and Strasbourg.  The advantage to steel wheel is the ability to blend into the existing rail network.  Tel, I know you have a woody for maglev, but if you want a system that works in your lifetime, better decide that perfect is the enemy of good enough.  Steel wheel can transition from dedicated high speed lines outside the cities to existing lines for the last twenty miles into the center of the city.  That is exactly how the TGV lines work in France, and the best chance to get a system operational in the US within twenty years.  Either can work from electricity generated from nuclear -- just as they do in France -- no carbon impact, sustainable, and faster than air in segments of under 300 miles.

If the Dems want to spend money we don't have to build this, then I am all for it.  To give money away?  Forget it.

[cpeakesqr]

Speaking of rail... has anyone else heard this lady running for the Senate whose answer to every problem the country faces is mass transit, specifically rail?  I love trains as much as anyone, especially on UP, but come on.  Financial crisis... rail.  Budget deficit... rail.  Value of the dollar... rail.  Iraq... rail. I wasn't the only one flabbergasted listening to her on the radio, someone called in and said she thought she was listening to Sarah Palin.

[rusthebuss]

cpeakesqr, on Oct 14 2008, 09:24 PM, said:

Speaking of rail... has anyone else heard this lady running for the Senate whose answer to every problem the country faces is mass transit, specifically rail?  I love trains as much as anyone, especially on UP, but come on.  Financial crisis... rail.  Budget deficit... rail.  Value of the dollar... rail.  Iraq... rail. I wasn't the only one flabbergasted listening to her on the radio, someone called in and said she thought she was listening to Sarah Palin.

Who is this lady and what state is she running for? Sounds like a Democrat to me

[scm]

rusthebuss, on Oct 14 2008, 10:51 PM, said:

Who is this lady and what state is she running for? Sounds like a Democrat to me

Neuuup, Rus -- move to the left of the Dems, and you find the Green candidate for Senate, from Virginia, Gail "For Rail" Parker.

[Padman]

Ok, it ain't just rail.  We've got the ability to harness enough wind and tidal power to solve most of our energy problems.   Dominion Power is only paying lip service to this idea, if that.  My sense is that they would rather invest in offshore drilling, nuclear and coal technologies for now.  Those are worthwhile short term activities (not without environmental hazard), but we need much more governmental encouragement in developing the sustainable sources.  If lenders provide capital, the free market can handle most of this, but not without more research and development grants and legal assistance.