bostonbubble.com

[john p]

The May 2006 discrepancy between the Warren Group and the Massachusetts Association of Realtors is f-ing bullshit.

Housing is the most common asset class available to our society. We have public accountants audit the performance of publicly traded companies to protect investors. Every home owner is an investor in real estate. Why is the government so lax with the data collection and protection for the investors of this asset class?

These two reports are so far apart it is sickening.

http://www.realtor.org/Research.nsf/Pages/RebenMking?OpenDocument

What is the technical data basis for this commentary? Where are they getting their reports from?

http://www.federalreserve.gov/FOMC/Beigebook/2007/20070613/default.htm


https://www.federalreserve.gov/GeneralInfo/Section515/default.htm


http://www.marketoracle.co.uk/Article1012.html

It is time that politicians start to press a bit more on the FED. We can't treat them like the Wizard of Oz where we stand back in amazement. We need to press them as to where they are getting their "reports". Who provided the reports and are they reliable. We can't have fuzzy reporting. I don't want some cocky financial board licking their finger and sticking it in the air. They've screwed up far too often to be given that kind of latitude. Smarten up, shorten their leash and get them to cough up their exact referenced data sources. No more bullshit.

[admin]

The NAR has claimed before that homes sold by an agent sell for substantially more than homes sold directly by the owner. Perhaps this would be the MAR's explanation for the huge discrepancy between its data and the Warren Group's data. Another explanation would be that the Warren Group's data covers everything and the MAR sales only cover the more desirable homes. However, this explanation is actually countered by the NAR news release itself (emphasis added):

[Froot Loop]

I have to disagree with the assertion that such discrepancies demonstrate a need for government intervention. All this study proves to me is that if you want solid information, don't get it from a group that has a financial incentive to lie to you. The government shouldn't need to protect us from our own stupidity (although it does... just look at social security, a savings plan for the galactically retarted).

It's for this same reason that I find the whole commissions thing to be absolutely ridiculous. Why would you hire a buyer's agent who has a financial incentive to make the selling price as high as possible?

[admin]

To follow up on my hypothesis of the divergence being influenced by more people cutting out the middleman:

[john p]

Froot Loop: I love the name...

Anyway, don't you think it is a bit unfair that it is expected that the "buyer beware" caveat is so reaching that it allows people to misrepresent or excuse unprofessional level performance? The fact is that government does base their policy on reports. It is not lassie faire. If they do base their policy on these reports I'm asking that they footnote their specific sources and reports. Look, all I'm asking is that people in their industry elevate their performance to a level that is close to fair. Not everyone has the capacity to be an expert in every facet of their lives. If you go to a gas station and you get bad gas, is it your fault that you didn't take out chemistry set to test the gas? No, we have weights and measures inspectors that come out and inspect things like to see if you actually get a gallon when you pump a gallon... Why do investors get the benefit of public accountants to ensure their investments? Why not buyer bewares for them? I'm not asking for a farm subsidy, I'm just asking that the government who sets policy bases their public policy off of a reliable source and make that source public so that the general public can keep their eye on them. This is a government of the people; don't you think that the FED ought to footnote everything that they base their policy on? If they don't we're almost living in a communistic nation where we have an elite class that doesn't need to answer to the general public or an aristocracy that can transfer a risk factor to a general public. I think if they are able to set policy and they don't footnote their sources it may be a soft form of insider trading. I think we need some sunshine. What if we have lobbyists pressuring or cooking the books and we're basing policy on it? The NAR uses this "sampling" approach. Has that ever been audited? Is there any professional standard for that to be done within? Everyone thought Greenspan was a genius and it was a love fest when he was being questioned. I think in our checks and balances in our country we need to do our due diligence so that we don't have hearings that don't probe. By just going through the motions we are cheating the system that was set up to prevent a governmental agency to base policy on a bogus industry self-serving group.

[Froot Loop]

Let's be perfectly honest about what the NAR is: a lobbying group. NAR's sole purpose of existence is to promote and benefit the interests of its members. It's not surprising, therefore, that they choose to only highlight information that is beneficial to their cause.

Is this dishonest? No. Is this misleading? YES. However, being misleading is not a crime, it's simply cause for distrust. Like any person/organization, if NAR is seen as being repeatedly and unapologetically misleading, it will lose credibility and influence.

Lobbying groups have their place in our democracy - they bring a forceful point of view in favor of (or against) certain policies and legislation. But they have to be recognized for what they are: sources of biased information.

Regulation is not the answer. Next you're going to say we should regulate cigarette lobbying groups for underreporting the number of cigarette-related deaths each year

[Froot Loop]

Reading this thread I couldn't help but think of Homer Simpson's observation:

[john p]

I love it; I don't watch enough of that show.

I think that is the frustrating part of my profession; to have a license I am accountable and I can't mislead or screw up like this. Why do dentists need to be licensed? Because they can inflict pain. Why does a barber need to be licensed? Realtors need to be licensed, yes? I know all you need to do is be able to fog a mirror, but don't they have any obligation as licensed professionals to be accountable to our society? If not, why do they need to be licensed? I guess their license applies to certain functions, not of which is economics and accounting. So what credibility do they have in this regard? Why would the FED use their numbers? I'm not sure if the FED does use their numbers, I am trying to ascertain that.

This era is suffering from a lack of professionalism. We don't have an objective playing field. The Bush Administration taught the business world one thing: Audacity is powerful, you don't need to be able to walk the walk, you just have to convince people that you can. We had a Governor from Texas telling us that he was going to be the "Education President". Texas public schools suck. Why on earth would we model our Federal policy on one of the worst performing state's systems? How about the brand "Compassionate Conservative". How about if they get called on absolutely blowing it like the "Slam Dunk" or "Mission Accomplished". They roll out the "Well we acted in Good Faith" and then promote the incompetent. Why can't I use that excuse in my profession? Why can certain people in society be able to play "Mickey the Dunce" and others need to operate under much more strict professional guidelines? These soft-professionals are now squeezing the real ones to a point where it is getting absurd. Without these standards we would be a 3rd World nation. The promotion of the incompetent renders the critics speechless and stunned to a point where they don't even press forward with their duty to be critical. The intelligent are being paralyzed and intoxicated by the smog of stupidity of those in power. They are confused because things don't make sense. Instead of pressing forward with common sense, they are like a bear uprooted bobbing up and down in water. Not only are the lightweights not grounded, but the common sense people are prevailing either. I don’t think the common sense people prevailed here in Boston with the real estate, I just think they ran out of kite string and got jerked back.