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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: 976
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
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#98. To: buckeroo (#89)
Why don't you ask her the next time you send her a C-note for the upkeep of her pro-war, Israel-First forum.
I have no reason to believe that picture is about her anymore than I believe your real name is Jethro Tull.
It is her, buckeroo. Goldi had that photo on her homepage at FR. There are others of her from that trip floating around the net as well.
Sot...that's the pic your girlfriend goldi the Zionist had on her FR homepage. Shame on you for supporting a warmonger.
This one too is "about her."
How do you know for sure?
Look closely at the HATE in her face. She's the one who refers to Palestinians as animals. Yep, it's your girl...
I don't think she is a warmonger. But I have never asked her. I think she is highly supportive of Israel defending itself; which I am, too. But, I fall away from supporting Israel on a number of issues, to begin with I don't like my country making little nation-states around the world that I have to eternally pay homage to. It is not written in the US Constitution that the US government has that mission. And it is wrong for our US representatives to place that nation above our own. When it comes to Israel, I think they have their defensive thinking caps on wrong. You don't cage territories to win friends. That exacerbates the already existing tensions and hostilities that we see today.
Good Lord where were you 4 years ago when we split from LP over Iraq? Everything that is happening in that hell hole we predicted correctly. She, OTOH, imported CaLOL and others to support the faux WOT. Yes, my friend, she's a bigtime warmonger.
GLs posts seem relatively "pablum" to me. If anyone is violent or a warmonger, it is me. I believe that to remove the shackles of this arbitrarily created UN and US government that interlocks with its own cheerleaders requires a bloodbath. American government has knowingly committed tyranny against its own citizenry while attempting to create global governance around the world ( including the creation of the state of Israel ) ... that perpetually causes me and you to pay homage of and about government. But GL as a warmonger? She is akin to pablum cake to me when it comes to this issue.
You're being silly now, buckeroo.
Buck...this is the third post of yours I read. I need a drink. Be back in 30 mins.
Again, how do you know? You don't know, correct? You assume or suspect, isn't that true? So, what does that make you? An Internet gossiper .... we need a lot less of you folks playing pattie-cake upon the Internet and out voicing opinions in public attaining a 6PM TV News media broadcast.
I was at the same PUBLIC event. For the third time, dense one, Goldi herself had the fingerflip one posted on her FR homepage. Get a clue, that's not internet gossip.
Easy N....Bucky is coming off an especially grueling border stint in a chaise lounge.
Where's your pic, butterball? Prove you were there.
Asshat!
You can easily verify it yourself.
Show me the way. Establish your credibility by discontinuing your circular riddles.
Kook!
Doh. Email Goldi Sharon and ask her if she was there. Simple, eh?
I don't have any detailed information other than your apparent gossip. Lets turn this idea around shall we? Lets suppose you are Goldi and I set up a thread on LP with the picture you have claimed is her. I then ask the question, "Goldi is this really you?" and place the thread in world news and in breaking news thus assuring it receives maximum attention. I then describe about the picture, to the best of my ability, by saying the Internet has gossiped about this being you ( GL ) signalling the bird at the UN while accompanied by none other the Tyranny Response Team, a dead group of otherwise sincere folks that attempted to get their pictures taken a major public events. And that your team members are much too afraid to say anything to me. Now then, since I have not fostered nor cultivated the deep personal relationship with GL as you have, why don't you make those same requests since your affinity with her is very close ... perhaps on the "snookums" category. For myself, I am a mere poster having no relationship with her at all. So, you can see the "pickle" you have attempted to impose on me, correct?
Weasel!
Minerva, please tell asshat that this rather odd picture was found in golda meir's pouch. Also, seal the post with the OWL picture. Thanks.
JT, if nothing else .. please inform Minerva to quit bumping the thread; she/it/he is not adding any benefit. As for yourself, feel free to confront me as you have time. We are old debating friends from FR ( 1999 - 2001 ), remember Roscoe? However, I must have overwhelmed you on this thread to have created the impetus within yourself to cower before me and avoid me while seeking third parties to arbitrate your own posts. I apologize for that. I shall attempt to remain my humble self in the future, however ... keeping your inabilities to debate with any form of adequacy, in mind.
Dear Buck: Sorry, I don't reacll Roscoe. Unlike you, nimrods have always failed to impress me. Now on to your point. What was it?
hi minerva! why are you teasing the asshat? did he do something? pm me?????
You are easily sidetracked, aren't you JT?
Honest to goodness I try my best to remain focused on your more cogent "debating" points, but they come years apart. And it's MY fault???? PS: Don't feel sorry for the dog. He's a butt sniffer.
Well, yes JT. It all your fault. Look at the way you intentionally steered this thread based upon housing in America, all away from the thread itself. Such a great job you have performed, don't you think? And you misdirected yourself about five separate times. Its as though your mind can not focus anymore. Didn't it occur to you that you could have made a thread all by yourself to share your grievances with me? But no, you wanted to tackle me here on this thread to prove a point, isn't that correct? So why not create your picture thread about GL on 4um and invite me? We can have all kinds of fun on your new thread ... assuming you have the balls to make one.
WOW, borrowed stuff ... as though you had any capability to create a picture yourself. I guess you are fascinated with Jews. Mel Brooks holds you to the pan-fire, doesn't he?
LMAO. Reposting a photo that Goldi herself had proudly displayed on her FR homepage is "apparent gossip." OK. I suggest you quit now. You are looking really stupid.
Again, before YOU take the time to attempt to belittle me .. I was wondering where is that link besides some off-the wall photo server. Got facts?
http://freedom4um.com/cgi-bin/readart.cgi?ArtNum=33885&Disp=44#C44
I see. Not much to look at, is there?
Not when you're a dumb
Nice ad hominem gesture on your part. So elegant and originally creative ... did your mother ever threaten you with washing your mouth out with soap?
American government has knowingly committed tyranny against its own citizenry while attempting to create global governance around the world ( including the creation of the state of Israel ) ... that perpetually causes me and you to pay homage of and about government. Moonbat. Kook.
In the immortal words of your illustrious bedpan poster and mentor, whatever.
How do you know that picture is GL?
#99. To: Jethro Tull (#98)
#100. To: buckeroo (#89)
How do you know that picture is GL? Because some poster says so?
#101. To: buckeroo (#99)
I have no reason to believe that picture is about her
#102. To: buckeroo (#99)
#103. To: Nostalgia (#102)
#104. To: buckeroo (#103)
How do you know for sure?
#105. To: Jethro Tull (#101)
Shame on you for supporting a warmonger.
#106. To: buckeroo (#105)
I don't think she is a warmonger.
#107. To: Jethro Tull (#106)
#108. To: buckeroo (#103)
#109. To: buckeroo (#107)
#110. To: Nostalgia (#108)
#111. To: buckeroo (#110)
#112. To: Nostalgia (#111)
#113. To: Nostalgia (#111)
#114. To: buckeroo (#113)
#115. To: buckeroo (#113)
#116. To: Nostalgia (#115)
#117. To: buckeroo (#116)
#118. To: buckeroo (#116)
Show me the way.
#119. To: Nostalgia (#118)
#120. To: buckeroo (#119)
#121. To: Minerva (#120)
#122. To: Jethro Tull (#121)
#123. To: buckeroo (#122)
#124. To: Minerva (#120)
#125. To: Jethro Tull (#123)
#126. To: buckeroo (#125)
#127. To: Jethro Tull (#126)
And it's MY fault????
#128. To: buckeroo (#127)
Ok, ok....i'll do the Buckeroo thread. First watch this, tho.
#129. To: Jethro Tull (#128)
#130. To: buckeroo (#119)
I don't have any detailed information other than your apparent gossip.
#131. To: Nostalgia (#130)
#132. To: buckeroo, itisa1mosttoolate (#131)
#133. To: Nostalgia (#132)
#134. To: buckeroo (#133)
fbuck.
#135. To: Nostalgia (#134)
#136. To: buckeroo (#107)
I believe that to remove the shackles of this arbitrarily created UN and US government that interlocks with its own cheerleaders requires a bloodbath.
I worship Israel. Kill all Arabs and let Allah sort 'em out.
#137. To: BlackSands, Badeye (#136)
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