heh, just got back into BA (Boeing)...

i'm far from a panic, but i just need to find a few hours to sit down and read some analysis/research/news

quote:

Originally posted by naeblis ^^ Agreed! Buy low sell high, if you didn't already sell out back when we were up 14% for the year, it is probably not advantageous to sell out now, only to buy higher later. I say it's just jittery investors. The reason housing prices have decreased now, is TOTALLY different than the reasons during the great depression. It's people reporting news and making things sound bigger than they actually are. Investors are just too jittery imo...

Very true, but things are as bad as they are being portrayed. In fact everyone has been in denial and everything happening now should've happened nearly a year ago.

Now what we have is a true liquidity crisis, which means all these lenders that sell loans on the secondary market, packaged up as mortgage backed CDOs aren't able to sell them. (for good cause because they are toxic waste and are backed by loans that should not have been given out, and the CDOs aren't performing and foreclosures are rising incredibly fast)

This is main reason you see all those lenders on that imploded list that closed their doors and/or filed Chapter 11 BK. The bad news is that all those borrowers that maybe should not have been give loans to buy homes and/or refi, now need to refi out of adjustable loans that jumped up already or will within the next year. No lenders will let them refi because guidelines got wayyyyyy too tight and rates jumped up a stagering amount in the last month due to the fact that no one will buy the loans on the back end. So whats left is most people will have no choice but to foreclose or short sale their home because they can't afford the new soaring payment and all the lenders turned their backs on them. This will cause homes to drop another 20% in the next year or two.

We are in for a verrrry difficult couple years. And an economic depression (simply meaning that the looming recession lasts for 3 or more quarters) is possible despite the differences of the Great Depression.

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Last edited by ninetyninej on Aug-16-2007 at 19:03

quote:

Originally posted by naeblis ^^ Agreed! Buy low sell high, if you didn't already sell out back when we were up 14% for the year, it is probably not advantageous to sell out now, only to buy higher later. I say it's just jittery investors. The reason housing prices have decreased now, is TOTALLY different than the reasons during the great depression. It's people reporting news and making things sound bigger than they actually are. Investors are just too jittery imo...

Maybe the prices are decreasing because there's an affordability problem? Maybe the people that bought in the last few years shouldn't be given a loan in the first place, driving up all the prices? I could be wrong though.

http://blogs.ocregister.com/lansner/

O.C. MEDIAN PRICE $640,000 for all of July 2007

To put things in perspective, it wasn't too long ago that my girl's parents bought their house right next to South Coast Plaza for 300K in 2000 (before the bubbaly bubbaly boo). It's probably now "worth" over 700K. Yeah, their incomes have gone up that much.

Anyone remember the last downturn in the early 90's to mid 90's? I don't, I was too busy with homework and stuff. But reading back, it looks oddly familiar to what's happening now, except this time, prepare for a steeper rollercoaster ride!

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*Depeche Mode* Appreciation

Not get nitpicky about verbage, but I don't necessarily characterize this downturn as a 'depression'. When people hear depression, they think of the abysmal conditions people were facing in the 30's. We don't even know if this is going to be a recession, yet alone a depression.

GDP is still up, see: http://www.bea.gov/national/nipaweb...r=2007&Freq=Qtr

As far as unemployment read: http://www.bls.gov/news.release/empsit.nr0.htm

Maybe the effects haven't hit? The market is notoriously over emotional at times, and so I guess I will wait and see how it plays out... I think it is far too early to be crying depression, or anything like that.

here's a nice chart if you like rollercoasters:

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*Depeche Mode* Appreciation

I don't see that as particularly helpful, because median home price in 1920 was nothing like it is now-a-days. I mean, a 100,000 dollar home back in the day was a mansion of opulence and luxury, where as today things are much different, a comparison of wages now and then, would most likely show the same difference.

quote:

Originally posted by naeblis Not get nitpicky about verbage, but I don't necessarily characterize this downturn as a 'depression'. When people hear depression, they think of the abysmal conditions people were facing in the 30's. We don't even know if this is going to be a recession, yet alone a depression. GDP is still up, see: http://www.bea.gov/national/nipaweb...r=2007&Freq=Qtr As far as unemployment read: http://www.bls.gov/news.release/empsit.nr0.htm Maybe the effects haven't hit? The market is notoriously over emotional at times, and so I guess I will wait and see how it plays out... I think it is far too early to be crying depression, or anything like that.

Well recession is what I was saying is inevitable at this rate and with all the foreclosures and their affect on stocks/economy (see topic title)

As for depression, we'll see but like I said earlier, it is possible and would not surprise me.

And in reference to your comments on that chart of home values, yes the income is now greater but you're not considering basic inflation and recession facts. You can't have inflation and home price appreciation as we've had the last 5 years and expect to not have a recession.

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The chart has been adjusted for inflation which affects wages and such.

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*Depeche Mode* Appreciation

You cannot afford to buy a house in socal, period.. not even making the median income for your area... even dinks are having a hardtime unless the combined household income is over 150k.

American Home Morgage.. those ****s.

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-Chris
"the night moves me" NIGHTMOVES.ME nightlife+lifestyle photography

quote:

Originally posted by djGT The chart has been adjusted for inflation which affects wages and such.

Yah, but has it been adjusted for square footage? How many people today are buying new 3 bedroom homes that are 1200 square feet (pretty common in 1950)?

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Originally posted by JD8899 Yah, but has it been adjusted for square footage? How many people today are buying new 3 bedroom homes that are 1200 square feet (pretty common in 1950)?

Not sure, but I don't think anyone is buying a home today, new or old, with no money down, no matter what square footage.

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*Depeche Mode* Appreciation

i'm in mortgages and a rule we always live by is 'as long as something is happening we're ok'

whether it's drasticly bad or good, as long as its not stagnant there's business to be made.

i've done over 8 purchases just in the last 2 mos, 4 short sales and 1 foreclosure, there are some very good deals out there right now.