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spork
Joined: 23 Oct 2007
Posts: 25
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 Posted: Fri Jan 18, 2008 5:57 pm GMT Post subject: |
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| john p wrote: | So what you're saying is that they will do unorthodox things that defy common sense to stop the hemmoraging, but will fail?
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actually...not fail (well that's TBD) but to avoid total financial collapse of the banking system. IF a major bank goes down, there could be a run on the banks...(It's A Wonderful Life....he-he ...right?) so they want to take the edge of slightly(the tail end of the subprime mess) so that there are huge losses in the financial industry, but not bankruptcy/failure.
this might be one of the only good things that was done in the past several years...which is ironically like living in Communist Russia or being a democrat  |
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john p
Joined: 10 Mar 2006
Posts: 1820
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| Posted: Fri Jan 18, 2008 6:35 pm GMT Post subject: |
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http://dictionary.reference.com/search?q=fungible
I think that "banks" are going to be fine. Investments are fungible and they have spread the risk to other folks. If people were buying bottled air, people would invest in the companies that made it.
I have a friend who has kids getting out of college and his personal finance advisor just told him yesterday that he ought to have 1/3 of his portfolio in oversees holdings. How many financial planners are saying that?
The problem is that the banks are following the "New World Order" model meaning the elites of all Nations work together to keep eachother rich and there is no loyalty to the United States; our currency, our Economy, the US Dollar is a global investment that can be bought and sold among other stuff. Whenever we had wars, the rich always kept lines of communication and investment open, and their strategy was to have a order to preserve wealth despite what the mob did with their government. If you think this is crazy, who harbored terrorists, most of the 9/11 terrorists came from Saudi Arabia. If we had Andrew Jackson, Teddy Roosevelt, FDR, or JFK, do you think we wouldn't have caught Bin Laden by now? The people that are charged with loyalty to the United States are our politicians. Sadly, they are way too dumb and need the elites money to even become elected. The goal of the elites is to maintain a very passive and lazy electorate. The problem is that if they are way too dumb, they won't have enough common sense to create asset bubbles and their stupidity alone creates turbulence. |
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spork
Joined: 23 Oct 2007
Posts: 25
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| Posted: Fri Jan 18, 2008 6:59 pm GMT Post subject: |
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| john p wrote: | | Sadly, they are way too dumb and need the elites money to even become elected. The goal of the elites is to maintain a very passive and lazy electorate. The problem is that if they are way too dumb, they won't have enough common sense to create asset bubbles and their stupidity alone creates turbulence. |
hilarious...very good point...
bubbles and volatility do help keep the "smart" affluent, wealthy
and allow for the opportunity of wealth for well-informed others
ah, the american dream |
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JCK
Joined: 15 Feb 2007
Posts: 559
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| Posted: Fri Jan 18, 2008 10:00 pm GMT Post subject: |
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| john p wrote: | Admin:
A couple of points to weigh in. I think that right after Bill Weld ended rent control in Massachusetts you got a surge in rental prices, and that whipped right into home prices. To say that rents have remained flat during the housing bubble is accurate to a reasonable degree, but I say that they bubbled before the housing bubble. I was paying $395 for a one bedroom in Melrose back in.....jeez.......1997 or so. That apartment is geting like $750 or $800 today. It stayed flat from about 2003 to now. What was a house selling for $395k in 1997 asking today? |
I agree. The picture is quite a bit more complex than "housing prices went up, but rents didn't." Rents did go up a tremendous amount ca. 1997-2000, probably more than housing costs.
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I think right now, 5% plus money for closing costs, moving costs, modest decorating, and a 8 month emergency fund is possible for most prepared first time buyers. I think that the housing stock available also adds a wild card of home repairs that could go up to $50k. I think that if credit is available for this profile, you won't see a plunge. If lenders want that 20% down regardless of income, we'll see a significantly lower amount of buyers. |
I am in the process of refinancing my mortgage and can tell you that if your credit is good, the brokers are falling all over you. Most are willing to deal, and are very accommodating. I think there's plenty of money for qualified buyers. And you can still get away with 90 or 95% LTV if your credit is good.
| Quote: | | I do think you can make a great deal this winter. Uncertainty is what keeps people on the sidelines, and who sells during uncertain times but motivated sellers (who most likely can make a deal on another transaction as well). It's not always the numbers, it's the properties of the materials. You might have hard nose sellers or motivated sellers. One motivated seller is worth ten hard nose sellers when you're doing your math, so if you have lots of motivated sellers out there now, that's not a bad thing. |
Inventory is down from a year ago. My guess (and it's only a guess) is that current sellers are more likely to be selling, rather than fishing for a sucker. I'd love to hear from someone who's making the rounds, whether it's delusional sellers or serious ones out there.
| Quote: | | I would advise that you should look at where you think things would drop to, and then look at the interest rate where it would align with that price drop,and then look at your job stability and financial position if there was a crash. <snip> Anyway, pick a target to where you think the bottom is, and then just low ball to what that point is. |
At some point, everyone has to make a call. We're going to bottom at some point, and it's not going to be low enough for some folks, and they're going to insist that we're going lower still, even after prices start to rise.
If for example, price drop 10% nominally over the next 18 months, but if interest rates go from 5.5% for a 30 year FRM to 6.25% in that time, are you really going to end up that much ahead by waiting? |
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admin
Site Admin
Joined: 14 Jul 2005
Posts: 1826
Location: Greater Boston
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| Posted: Fri Jan 18, 2008 10:33 pm GMT Post subject: |
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| JCK wrote: |
I agree. The picture is quite a bit more complex than "housing prices went up, but rents didn't." Rents did go up a tremendous amount ca. 1997-2000, probably more than housing costs.
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Fair enough, but rents had reason to spike as they were being artificially suppressed before, whereas housing prices weren't (at least not directly). My point before was just that a prolonged fall in prices now is not contingent on rents falling.
- admin |
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john p
Joined: 10 Mar 2006
Posts: 1820
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john p
Joined: 10 Mar 2006
Posts: 1820
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| Posted: Tue Jan 22, 2008 2:32 am GMT Post subject: |
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By the way, today, the stock exchanges were closed due to MLK day and the exchanges overseas really dropped like 5%. This is due to Bernanke's comments and this new stimulus package, which I think they feel means we're going to print more money.
I'm kind of bummed that the stimulus package isn't focused on the people that got hurt. I mean this subprime hurts those that recently bought fairly and those that are priced out. The current ideas being floated seem to help everyone including those that caught the wave of the bubble. I mean it's like they are dishing out second and third servings to some when others, a generation are the ones that are priced out or are house poor. Hell, I'd like a farm subsidy, but the only thing I can grow is dandelions. |
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admin
Site Admin
Joined: 14 Jul 2005
Posts: 1826
Location: Greater Boston
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| Posted: Tue Jan 22, 2008 1:50 pm GMT Post subject: |
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| john p wrote: |
This is like seeing the hurricane off shore; we'll see how much damage we'll get. What do you think will be the fallout? |
For the US, I would guess that the fallout will be high inflation, a deep recession, or a mix of both. The Fed just cut rates three quarters of a point literally a few minutes ago, so it would seem they are reacting to the negative feedback and attempting to choose inflation. Things could get a whole lot worse if the rest of the word finally says they are fed up (no pun intended) with the US' devaluation of the dollar. Maybe there is no better option, though.
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john p
Joined: 10 Mar 2006
Posts: 1820
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| Posted: Tue Jan 22, 2008 2:45 pm GMT Post subject: |
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When you think about this economic storm, think about what neighborhoods get hit and where the FEMA aid will go. The eye of the storm are the first time buyers, recently bought and about to buy. People who bought 10 plus years ago bought when housing was more fundamentally based. If they chose to do a second mortgage and use their home as an ATM, that is their self created hardship. The younger generation that was dealt this hand are more victims and deserve the aid more than anyone else. I mean our generation needs to almost live with two earners so they ought to think about making day care tax deductable to target this generation that was hit by the eye of the storm.
The FED doesn't give a s$%W about injecting the novicane where the toothache is, they just care that the banks are ok. The politicans want to spread out the Santa Claus gift giving so they translate to votes. Sadly, the aid won't hit those that were truly victims in this, it will go to banking cronies and to where the best bang for the political buck lands. It will be like sending money to Wall Street for Hurricane Katrina, even though the FED created the hurricane.... |
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JCK
Joined: 15 Feb 2007
Posts: 559
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| Posted: Tue Jan 22, 2008 3:05 pm GMT Post subject: |
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| john p wrote: | When you think about this economic storm, think about what neighborhoods get hit and where the FEMA aid will go. The eye of the storm are the first time buyers, recently bought and about to buy. People who bought 10 plus years ago bought when housing was more fundamentally based. If they chose to do a second mortgage and use their home as an ATM, that is their self created hardship. The younger generation that was dealt this hand are more victims and deserve the aid more than anyone else. I mean our generation needs to almost live with two earners so they ought to think about making day care tax deductable to target this generation that was hit by the eye of the storm.
The FED doesn't give a s$%W about injecting the novicane where the toothache is, they just care that the banks are ok. The politicans want to spread out the Santa Claus gift giving so they translate to votes. Sadly, the aid won't hit those that were truly victims in this, it will go to banking cronies and to where the best bang for the political buck lands. It will be like sending money to Wall Street for Hurricane Katrina, even though the FED created the hurricane.... |
john p,
Agree 100%. The sad truth is that the young homeowners/buyers are part of demographic that simply does not vote in large numbers. Politicians get far more bang for buck pandering to the older and elderly or giving money to the organizations that lobby than providing relief to young homeowners. That's at least part of the equation. |
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Guest
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| Posted: Thu Jun 23, 2011 3:36 am GMT Post subject: Re: No You can't |
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| krishnarama wrote: | I think it is true . living like a king in your home. But rarely can you get out and spend sometime outside. You can have mercedez,but where are the roads. Yah they are building now,but they won't be enough. It is also not secure in big cities. there are always some bombs exploding. there are also no parks,no clean lakes. Traffic is horrible. Pollution,oh please. Let us not get there. What about the smell and hygiene. I used to joke around here with my friends when I first came to states that two things I see more often are trash bins and restrooms with tab water. They are virtually taken for granted here. But over there in INDIA,oh boy they are privileges. It is extremely uncomfortable for women once they go outside. Because there are no restrooms. Forget about water. Whenever I come back from India, I would go to kitchen ,turn the tab ,fill up the glass and drink the water and pause and think myself ,"Man that was easy". Not that the income disparities are not visible here in states. They are actually widening between haves and have nots because of the printing presses run by FED. Those who have access to those freshly printed $s get benefit ,but others pay prices by inflation. But they are much more visible there and very uncomfortable to live with even for those who have the wealth and the sense. If you don't have the respect for others but have wealth,that is probably a good place. Also male female ratio already titled towards males. There are more males than females. I got married seven years ago. I got lucky. Now if you are guy,good luck getting married. It used be that guys select girls even it is arranged marriage. Now it is girls turn. There are lots of 30+ guys unmarried. What do they do now. They stare at all the girls (wherever they find them) from top to bottom . It is really uncomfortable and disgusting. I have seen it when I went out with my wife last year in South India. That is one reason why my doesn't want to go back there. No if you they pay me in INDIA as much they pay in Boston , I wouldn't even think about it. For some, money is everything.For others money is just as iimportant as clean environment with better infrastructure with
museums/night life/out door activities/education/diversified stable economy/and much more open society. I can't Bill Maher in India although I can still watch his show in HBO in India. But there is a big difference. |
i have to really laugh when i read this. i know this thread was three years ago, but things haven't changed that much for indians in the US and india. there is some truth to what you say above, but i also see lots of indians going back to india. this generation of 20 and 30 something indians are super status conscious -- they live in nice new homes, modest by american standards but well above average in india in gated communities and have domestic help for everything. if they have lived in the US for a while saved up before going back to india to work for multinationals they have quite a good life -- they have chauffer driven cars provided by their employers, earn very well and don't have to lift a finger other than doing their job. everything is taken care of by domestic help which comes cheap. yes they do give up open spaces and have to put up with some pollution and endure long commutes, but that's a compromise that works for many young indians.
aside - so how did 2008 turn out? |
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