See other Business/Finance Articles
Title: Pop Goes the Bubble (housing market)
Source:
Lew Rockwell
URL Source: [None]
Published: Aug 30, 2006
Author: Bill Bonner
Post Date: 2006-08-30 10:30:09 by bluedogtxn
Keywords: None
Views: 1867
Comments: 137
by Bill Bonner "What's that Hissing Sound?" headlines a piece in the Economist: "The boom has lifted the (U.S.) economy in three ways: it has boosted residential construction: it has made people feel wealthier and so encouraged them to spend more; and it has allowed homeowners to use their property as a gigantic cash machine, taking out money by borrowing against their capital gains. Merrill Lynch estimates that the three together accounted for more than half of America's total GDP growth since last year. "Counting construction, finance, and estate agency, the housing boom has been responsible for one-third of all the jobs created since 2001. If house-price rises level off, GDP growth could dip below 2% in 2007. If prices fall, expect a steeper slowdown." Since it is now in the Economist, it's official – housing is in trouble. But will prices actually go down? We have a report directly from one of the hottest markets in the country, south Florida: "We just missed it. The time to sell was a year ago. A guy came along and offered us $500,000 for that place we bought. We paid $450,000 for it two years ago. Our timing couldn't have been worse. We expected to tear down the house and build a new one...and we were sure we'd make a couple hundred thousand in profit. Minimum. But you warned us. And we didn't listen. And then, we got that offer for $500,000 and turned it down. We thought we could get much more. But that was then and this is now...I'd be happy to get back what we have in it. But we can't even get anyone to look at it." Paul Kasriel says it's the worst supply/demand equation of residential real estate in 34 years. Sales in July were down more than a fifth. Inventories were up more than a fifth. And a lot of real estate investors are now going to the liquor store to get another fifth. They wish they could turn the clock back a few months and unload properties at last year's prices. But maybe the situation is not as bad as it looks. The New York Times reported the news last week that real estate downturns in England and Australia have been surprisingly mild. And now, Business Week has a big story entitled "Housing: The Roof Won't Collapse On The U.S. Economy." According to Business Week, housing can go a little soft without damaging the economy too severely. That view has become the mainstream dream. What do we know; maybe it will turn out to be true. As our friend John Mauldin points out, we usually muddle through. Usually, tomorrow is like today. Usually, nothing too bad or too good...happens. Usually, things are average, ordinary, common, and regular. But wait, there is nothing ordinary about this housing bubble. In the space of less than 10 years, according to Robert Shiller's index, the real value of residential property doubled. And householders doubled up their debt, too. Neither are things that happen every day; in fact, they've never happened before! We are not looking into a crystal ball here. We are just putting two and two together. If things are usually usual, then when they are unusually unusual, they are probably more likely to become usual again, rather than become more unusually unusual. That seems so obvious to us, we won't bother to explain it. And when housing prices become usual, then the poor sap who has bet his house on something extraordinary is likely to be in a tight spot. And since the entire U.S. economy, and by extension the entire world economy, depends on him being able to continue to spend, then they're all in a tight spot. Yes, the whole world economy now depends on a man who spends money he doesn't have – money of no sure value – on what he surely can't afford, and which he probably doesn't need anyway. He can only do so as long as his house rises in price. And now, that the rise in housing prices has come to an end. What next? Everyone has come to expect slowing real estate gains. The boom is over; everyone seems to think so. So, where is the surprise? Where's the money to be made...or lost? Again, we don't know. But in August 1982, Business Week famously predicted that the equity market was finished. Now, in August 2006, BW tells us not to worry: the roof will not collapse. BW might not be right, but it might be consistent; the roof might blow up. August 30, 2006
Post Comment Private Reply Ignore Thread
Top • Page Up • Full Thread • Page Down • Bottom/Latest
Begin Trace Mode for Comment # 76.
#3. To: bluedogtxn (#0)
"We just missed it. The time to sell was a year ago. A guy came along and offered us $500,000 for that place we bought. We paid $450,000 for it two years ago. Our timing couldn't have been worse. We expected to tear down the house and build a new one...and we were sure we'd make a couple hundred thousand in profit. Minimum. But you warned us. And we didn't listen. And then, we got that offer for $500,000 and turned it down. We thought we could get much more. But that was then and this is now...I'd be happy to get back what we have in it. But we can't even get anyone to look at it." NJ is in the tank. I told my daughter last year, over and over, to bail and she refused. Now she's stuck (making six figures, btw) in a state that is taxing her out of house and home. It's painful when your own family ignores what we see coming.
JT, your successful ability to foresee the future back in 1999 ( Y2K phenomena ) probably made her cringe upon your latest prognostications. You struck out, pal.
Stewball...the prudent thing to do concerning Y2K was to prepare. I did, and I remain prepared today. You, OTOH, continue to argue with Zionist swine on a forum owned by a Jewish religious zealot. No Bucky...It isn't me who is wasting his time :)
I have thought about your remark. And I have come to the conclusion you are the essence of the swine that you suggest. You are bigoted; moreover you seem to wear this continuous aurora about Jews being some sort of evil on a majority of posts you make. How do you come out upon a public forum with a single celled brain posing this agenda? Aren't you embarrassed? You are the type of jerk that if the Jews weren't here; your complaint would be about nigs or spics or japs or gay cavalieros. Your focus is about anyone different than yourself. Even if everyone one was an old white man, retired NYC cop, you would still find some attribute about those around you that could be considered inferior ... say, methods of expression which may be unlike your happy, go-lucky down-syndrome goony smile. Yeah, you like to herd alright. And when you find you aren't the best thing since sliced bread in your life, its someone else that is the problem.
Here we agree, I am bigoted and I do hate. I’m bigoted toward the Zionist pigs you hold dear on LP. Your continued support of Goldi (you respect her) and her forum is beneath contempt. Without the support of her coven of harpies, the plans for Iraq would never have left the safety of the PNAC think tank. To quote a man I detest, Newt Gingrich, her forum should be allowed to whither on the vine, but rather than avoid the place asshats like yourself continue to breath life into the enemy. Congratulations. Government, at all levels, is something else I’m bigoted toward. In fact I hate it. Nothing short of a complete collapse will satisfy me. No thanks trying to salvage this mess with a vote (you still vote, right?) pipe dreams like voting the bums out is impossible. Too many bums, not enough time, but continue on. It's a harmless enough exercise. Have I told you about the 3rd world scum that I see all about me here in NJ? Yep, they cause my bigotry meter to rise. These two legged pigs have broken into my country, refuse to learn my language and have for all intents and purposes erased our Southern border. IMHO, hate, anger and bigotry are the proper emotions for such a national disgrace. There isn’t a need to go into the services these wetbacks chew into; you know the drill. I Understand you stood on the border with an aging group of white men called the minutemen. Let me give you a tip Bucky, save your time, it’s over. Aging fucks in lawn chairs are no match for the La Reconquista we face. Why is it over? Because feckless whites shy away from bigotry and hate. These emotions are the proper reaction to what is pulling our country down, but alas, I’m one man. You of even temper have won. Now run along. Goldi, Badeye and the clique of time wasters are calling.
I can spot you in a crowd of thousands walking down 42nd Street in NYC on a cold and snowy day. Its not so much the clothes you wear or the way you hold yourself ... its the way you slip upon the cement while attempting to stay in stride with the herd. I do respect Goldi. She has taken a lot of crap from bigots, like you and and many others for no reason. I hate to say this, but to use a classical cliche, she has balls making that forum. I am on record about my disagreements with her, too. All of my complaints have been on that public channel, too. Check them out if you have time while eallowing in your own misery. I don't run around the world and make other forums my issues. I keep my opinions in perspective with regard to the subject matter; the thread as it were. And I refuse to berate Goldi here or anywhere; just as I don't berate Jim Robinson here or anywhere; or unamused here or anywhere; or John Deere here or anywhere or Christine here or anywhere. I don't think you are even close on this. You need to expand and clarify your perspective ... its to vague for me to discuss. Let me explain my reasons for posting on LP. I enjoy a wide variety of comments. Nothing more or less. I am awkward slapping people on the back that I agree with. I enjoy this forum ( 4um ), too. But many of the posts I agree with and so don't attempt to much but to suggest an added perspective for the most part. Well, don't that beat all! We agree. I think it perpetuates the system because there are no REAL requirements for voting. Its the government, stupid. The government is not performing the job it is required by the US Constitution. It is not a religion, sect, class or race of people. Well, of course I win. I don't run off the mouth like a whore in heat as you do. Naw. I think I shall stick around awhile longer. 4UM is getting bigger and better ... more threads and "hits" are here than ever before.
I’m quite aware that you support Sally in a number of ways, the least of which are your inane posts. You’re perfect fodder for the paid shills, so have a ball. It’s your monetary contributions to this bigoted, Zionist hater that tick me off. In my book that makes you a supporter of her hate. Here’s a walk down LP memory lane you walking POS: http://libertypost.org/cgi- bin/readart.cgi? ArtNum=31145&Disp=1542&Trace=on#C1542 1655. To: certified fool (#1542) One of the co-owners, Goldie herself, once posted a particularly vile post (worse than Zoroaster's) that unmistakenly illustrated that she is a bigot herself. But like they say, some animals are more equal than others. BTW, anybody out there have a link to Goldie's charming little rant about what she thought of Palestinians? Israel should round up all the Pallies, put them in Gaza, and build a 30 foot electrified wall around it, and electrified poles under the wall to keep the Palimals inside their pen. Then just totally ignore them, and let them work, eat, and support themselves OUTSIDE of where the Jews live. Total Isolation. They deserve it. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ I have reconsidered my remark calling Palies animals. Since animals only kill to eat, I have seriously insulted all animal species. I rephrase my remark to state that the Palies act like insane soul-less demons, jubilent after the killing of innocent souls. The Palies are depraved beyond redemption, and they should all rot in hell. Their flesh should bubble up in boils, and pus should ooze from them; their eyes should burst, and the blood run down their oozing pathetic faces. Their lying filthy mouths should swell until air cannot pass their lips, and they should flop around like fish fighting for air until their lungs explode. Now, do you want me to tell you how I REALLY feel? In the event you don't know how their OWN people feel about them, none of the other Arabstates will allow them in. Even now, they have to post thousands of dollars to enter Jordan...to guarantee they'll leave. Why? Because they are pathological liars, murdering, untrustworthy, duplicitous, pains in the ass, who will cause disruption and chaos whereever they go. Last time they were in Syria they tried to assassinate the king and take over the country. NO ONE LIKES THEM...because they are nothing but trouble wherever they go! Demon spawn! The UN is nothing more than a bunch of socialist Arab apologists trying to undermine the US and also Israel. They have NO credibility. Goldi-Lox posted on 2002-08-04 22:06:46 Reply ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ *mock-humans: They are monsters, demon-spawn, soul-less devils. Cruel, evil, hateful, disgusting vile creatures that happen to inhabit a form much like one that is human, but with no soul, can be only described as a gollum. A creature. An abomination on the earth. The force they pray to is Evil Incarnate, the Devil, and the source of all abominations. May they be cursed and afflicted now and forvermore. Goldi-Lox posted on 2002-08-05 16:55:12 Reply
Didn't you mean GL is a Zionist lover? I have always donated money to web sites that I enjoy. JR of FReepland, Neil McIver of LP and GL of LP, Brett of FU, too; just to name a few that I know you know about. I shall slap a few bucks here to Christine when I feel ready to dispense with my money as well; my contributions are not trivial. The rest of your rant does not interest me. I am against the UN, too. I am against the UN because it created Israel and am on record for this point everywhere I go if it makes you feel better. But it won't. You have already marked me as some sort of benefactor for Zionists. Oy Yey!
Sally is a Zionist *bigot* Jewess. Her hatred toward Palestinians is there for you to read. I’m not surprised you aren’t interested.
Now I can handle a chunk of your ideas .. but flooding me with post#16 serves no purpose whatsoever as it ensures you look like a fool not addressing the specific issues that are on your mind. I am not going to defend her, pal. She may be an Israel-Firster. I am not. I am not a Palestine-Firster, either. I am an US_FIRSTER and want my government to pull out of all other's business except ours, here in the states.
Bullshit. There isn't an isolationist bone in your body. Anyone who doesn't acknowledge that Israel is a creation of the UN, that it sits on stolen land, that its people are incapable of living in peace and that they use American tax payer dollars to kill and maim innocent people *isn't* an American firster. You’re a common lackey for the Golden Zionist.
ROTFL. I say the same intent with just different words on LP. As I suggested far up the thread ( thanks to your flooding post#16 ) you find problems with any and everyone if you find the smallest differences; even in the grammatical and syntax methods of expression.
You support Israel which requires a belief that the UN has the authority to create nations. In what way has this notion supported an America-First philosophy?
But, I don't support Israel nor have I ever. Nor the UN that sanctions the legal character of "statehood" of Israel or the meddling of either the USA or Britain and France about forcing the creation. Man, you have me all wired wrong. Go take a breath of fresh air in NJ. And pet your gerbil.
As I said before, bullshit. By filling Sally the Zionist's pocket, you support her passion. Enjoy.
LP is her forum which requires money to operate just as all websites. If nothing else there is the $25 bucks/year for domain name registration. In a way Neil McIver can thank me for the bucks Goldi gave him for helping to move the site into new hardware that was finally co-located for a real Internet site instead of a broomcloset in GL's house. All he had to do was sit there for a few minutes unpacking the tar files using a script upon the new HDD. Such a nice guy. But overall, the change was necessary. It took money to make the changes happen. I was happy to help. The increased BW is awesome and for a surfer I can determine a good site in seconds without evaluation. I am glad GL finally realized that she had to do something about the issue. She performed wonderfully, too. She realized that the forum the wasn't hers because of asset resource allocation only but those that attempted to make it something. She didn't have the money so she bit the bullet and asked the forum to come through to ensure the technical characteristics were within a reasonable budget. She took a long time evaluating before, present and after processes.... an attribute of ownership that I applaud for anyone concerned about their own. You can bet I wanted to contribute towards that forum. Elections are coming up.
I'm sure the brooms are happy to be back home too now LP is out of their domain. Why don't you or one of you go to the biker bar and dialog about the restrictions on posting material? Especially in light of the questionable nature of material used by people whose ideology and beliefs get a spacial pass as they resonate with her beliefs. LP acts like such a group of cowards in refusing to confront Goldi about this sort of temperament irrationality she love to engage in.. Or get her to let me back in. I wold make time to post everything I would have to say were I back. If you guys don't want to do it, get me back in, I'll gladly take her censoring butt to task because LP is supposed to be better then that. And because she really should have known better to do that, and other recent actions that make us all wonder in concern at the state of her sanity.
Ask the mighty one whom started this exchange. I have attempted to hold the guy back ... but he is becoming pissy ain't he?
Hey, tell you what,you and I both know Sally ain't the nuggets to let me back in. Deliver a message to Quantrill for me, tell him I don't think he has the balls to come over to 4UM to debate. And that I think he is a disgrace and traitor to this country for supporting George and company in the conduct of their criminal wars and outrageous acts on 9-11. Quantrill is a bastard whom his mother should have aborted. In light of his support of abortion, he could not begrudge her for not regretting not having done so in the years she must have endured in watching the sorry excuse for a chimpanzee afterbirth grow up and disgrace his own family's name far worse than any other male relative of his who have served terms in prison in the course of the period they were together. You don't have to say all that now, or say anything at all because I would never assume to tell you what you should or shouldn't do. Give him my invitation if you would, as simply as you wish, if you feel like doing so. Just the satisfaction of seeing him too cowardly in nature to come over for a visit would makes me just as satisfied in many ways the fun to be had if he did show up at 4UM. ;-)
Ghostie? I won't help you. Thats your problem with that disgusting poster.
It's not even a problem. I already said I didn't care if you did or didn't, so that's fine with me. He'll either get my message one way or another, or won't. I won't lose sleep either way.
I think Ghostie was neutered by his poor parents ... they needed something to sell at the local farmer's market so they took his mountain oysters and sold them for .5 Rubles. But that is just my take on his humble beginnings.
Goldi, the IsraelFirster, flips off the UN then and AmericaFirsters now.
Is that really Goldi, or a guy in drag making fun of her?
Hmmm... face looks familiar
#77. To: jessejane (#76)
LMAO! My G-d [sic], the resemblance is uncanny!
Sharon told Bush he was unwilling to attack Iran. I don't think he would have launched the recent attack on Lebanon.
Top • Page Up • Full Thread • Page Down • Bottom/LatestWe have a report directly from one of the hottest markets in the country, south Florida:
#4. To: Jethro Tull (#3)
It's painful when your own family ignores what we see coming.
#6. To: buckeroo (#4)
#10. To: Jethro Tull (#6)
You, OTOH, continue to argue with Zionist swine on a forum owned by a Jewish religious zealot. No Bucky...It isn't me who is wasting his time :)
#11. To: buckeroo (#10)
You are bigoted
#14. To: Jethro Tull (#11)
Here we agree, I am bigoted and I do hate.
I’m bigoted toward the Zionist pigs you hold dear on LP. Your continued support of Goldi (you respect her) and her forum is beneath contempt.
Without the support of her coven of harpies, the plans for Iraq would never have left the safety of the PNAC think tank.
To quote a man I detest, Newt Gingrich, her forum should be allowed to whither on the vine, but rather than avoid the place asshats like yourself continue to breath life into the enemy. Congratulations.
Government, at all levels, is something else I’m bigoted toward. In fact I hate it. Nothing short of a complete collapse will satisfy me.
No thanks trying to salvage this mess with a vote (you still vote, right?) pipe dreams like voting the bums out is impossible. Too many bums, not enough time, but continue on. It's a harmless enough exercise.
Have I told you about the 3rd world scum that I see all about me here in NJ? Yep, they cause my bigotry meter to rise. These two legged pigs have broken into my country, refuse to learn my language and have for all intents and purposes erased our Southern border. IMHO, hate, anger and bigotry are the proper emotions for such a national disgrace. There isn’t a need to go into the services these wetbacks chew into; you know the drill. I Understand you stood on the border with an aging group of white men called the minutemen. Let me give you a tip Bucky, save your time, it’s over. Aging fucks in lawn chairs are no match for the La Reconquista we face. Why is it over? Because feckless whites shy away from bigotry and hate.
These emotions are the proper reaction to what is pulling our country down, but alas, I’m one man. You of even temper have won.
Now run along. Goldi, Badeye and the clique of time wasters are calling.
#15. To: buckeroo (#14)
"I do respect Goldi." - Buckeroo
#17. To: Jethro Tull (#15)
It’s your monetary contributions to this bigoted, Zionist hater that tick me off. In my book that makes you a supporter of her hate.
#18. To: buckeroo (#17)
#19. To: Jethro Tull (#18)
Sally is a Zionist *bigot* Jewess. Her hatred toward Palestinians is there for you to read. I’m not surprised you aren’t interested.
#21. To: buckeroo (#19)
I am an US_FIRSTER
#22. To: Jethro Tull (#21)
Bullshit. There isn't an isolationist bone in your body. Anyone who doesn't acknowledge that Israel is a creation of the UN, that it sits on stolen land, that its people are incapable of living in peace and that they use American tax payer dollars to kill and maim innocent people *isn't* an American firster. You’re a common lackey for the Golden Zionist.
#23. To: buckeroo (#22)
(Edited)
I say the same intent with just different words on LP.
#24. To: Jethro Tull (#23)
#28. To: buckeroo (#24)
But, I don't support Israel nor have I ever.
#29. To: Jethro Tull, Neil McIver (#28)
#32. To: buckeroo (#29)
(Edited)
"Goldi gave him for helping to move the site into new hardware that was finally co-located for a real Internet site instead of a broom closet in GL's house."
#34. To: Ferret Mike, Jethro Tull (#32)
#42. To: buckeroo (#34)
(Edited)
"Ask the mighty one whom started this exchange. I have attempted to hold the guy back ... but he is becoming pissy ain't he?"
#52. To: Ferret Mike (#42)
#53. To: buckeroo (#52)
#54. To: Ferret Mike (#53)
#65. To: buckeroo (#54)
#70. To: Nostalgia (#65)
#76. To: bluedogtxn (#70)
Is that really Goldi, or a guy in drag making fun of her?
Replies to Comment # 76.
#79. To: jessejane (#76)
End Trace Mode for Comment # 76.