Monday, February 16, 2009

Time Magazine Names David Lereah as Part of '25 People to Blame for the Financial Crisis'

Time Magazine Names David Lereah as Part of '25 People to Blame for the Financial Crisis.' The page on Lereah is here.

When the chief economist at the National Association of Realtors, an industry trade group, tells you the housing market is going to keep on chugging forever, you listen with a grain of salt. But Lereah, who held the position through early 2007, did more than issue rosy forecasts. He regularly trumpeted the infallibility of housing as an investment in interviews, on TV and in his 2005 book, Are You Missing the Real Estate Boom?. Lereah says he grew concerned about the direction of the market in 2006, but consider his January 2007 statement: "It appears we have established a bottom."
Nice. Well put. He definitely deserves blame for the current financial crisis. It would have been much better if the mainstream media had shined the light of scrutiny on David Lereah back during the height of the bubble when he was cheer leading the bubble and then later denying the bust.

18 comments:

  1. Hey - any of you guys notice Leroys most recent posts on Nova Bubble?

    "Leroy said...
    "JPMorgan, Citigroup Will Suspend Home Foreclosures Until March "

    That is only a delay of a few weeks, but I am starting to wonder if the government really will be successful in slowing the market's correction for at least the first half of this year."

    Looks like he is laying the groundwork to dismiss the lack of huge price declines in Arlington this year.

    Its all very sad really. He is a very smar, one of the best bloggers to be on this or any DC based board. However, he made the mistake in saying years ago that Arlington shall suffer the same fate as the rest of the DC area.

    The problem for Leroy is those huge price declines he thought ARL would see arent going to happen. Now, instead of admitting he was wrong, it looks like he is creating an escape route (i.e. Arlington would have fallen but for the government).

    I was hoping one day he would fess up and admit he was wrong about Arlington. Now, I dont think that
    he will ever do that - sad...

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  2. "i.e. Arlington would have fallen but for the government."

    Yeah, but that escape route is closed to him since I told him a long long time ago that the government would indeed step in to keep people in their homes ... and prices up. But he never could quite understand that the advice I was giving him was from a "realist" slant and not from a "but it shouldn't be that way" view as he apparently has. He is smart ... If he could only get past the "this is how the world should work" to "this is how the world does work", he'd do well for himself. I guess it'll come with time. I know it did for me. Some folks gotta get burnt before they understand.

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  3. It is funny when lance tries to pretend he knows what he is talking about.


    Nice imaginary friend there lance, you have us all fooled into thinking it isn't you talking to yourself.

    ;)

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  4. I disagree Lance. Even without the govt stepping up, its obvious Arlinton is on a different plane than is the rest of the area - the last year has proven as much. Turns out, the area is just too popular for its own good.

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  5. Actually, Lance just contradicted himself. Used to be, Lance said places like Arlington held up because they were more popular (i.e. its a new paradigm)

    Now he is saying, he thinks places like Arlington will hold up because the govt wont let them fall (i.e. no new paradigm)

    Which one is it Lancey?

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  6. Leroy's problem is he bit off more than he could chew. He completely humiliated Lance showing how 90-95% of the DC area will have huge price declines, and he was right.

    I think the problem is once the 5 10% of the area that is largely resistant (not immune - but resistant) started showing its strength, Leroy got cocky and assumed they would suffer the same plight as the rest of the area. (i.e. Arlington isnt different, it will suffer the same fall as Fairfax & Loudoun).

    Had he left well enough alone, realized that 5-10% of the area will do much better than the rest, no one would give him grief. Yet he couldnt quit while he was ahead & now he wont admit he was wrong - meaning he has to grasp for excuses.

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  7. "Had he left well enough alone"

    This is 2009, the immunozone was obvious 3 years ago.

    In fact, someone surveyed their friends and discovered that there were people who would not live in PWC (or Manassas or some other godforsaken stretch of tundra) even if they got a free house.

    Over on NOVAbubble, said Leroy is busy parsing the cost of commuting, new car/used car, gas, tolls, as if that's the deal breaker.

    It's not. There are people who will not subject themselves to hours in a car each way, every day. That's their preference and no amount of "but you get a cheap house way out there" will induce them to commute.

    That's the fallacy of "substitution effect". If you want to live close to or in the city, why would you live in the country to save a few dollars.

    It may be that only 20% of the population eschews a long commute but if that 20% has to fight over the 10% of the houses, then let the bidding begin.

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  8. As I've said before, nobody cares about Arlington. It makes up less than 4% of the DC metro area's population, yet somehow it seems to make up 50% of the geographic area–specific Bubble Meter comments.

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  9. James ... what are you counting as the metro area? Are you going past the beltway (way out there) or out past Fairfax and Montgomery counties (way way out there)? I had to laugh at the comment about 5 - 10% ... The so-called immunozone is basically everything within the beltway (hence 100% of the metro area in the view of many) and then some ... hence at least 50% of the metro area if you include out to Fairfax, Montgomery, and PG Counties (the most commonly agreed-to definition of the DC metro area.) Please don't start counting West Virginia ... or Baltimore!

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  10. This comment has been removed by the author.

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  11. James only reads autobiographies of virile men who actually have or had access to willing women.

    Its his way of living vicariously.

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  12. "The so-called immunozone is basically everything within the beltway (hence 100% of the metro area in the view of many) and then some ..." - lance the troll (In 2009, WTF?)


    Who needs to read more than that one line to know that he is a pile of crap?

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  13. It is nice to see David Learah getting some recognition for lying all those years and intentionally trying to talk would-be buyers into making the biggest purchase of their lives with false assumptions.

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  14. "John, it's not often you and I agree ... But in this case we do. Chances are that there will be buyers at higher prices now that we're past "the bottom". David [Learah] was right, David J. wasn't. We've bottomed out and prices are on the move up. This makes no difference to us homeowners who already locked in ... But all those BHs who held off waiting for magically drastically lower prices? They're screwed ..." - Lance 5 April 2007

    Of course, since then even David Learah has come out and admitted that he was lying.

    Imagine that, even David "lying" Learah, the Baghdad bob of the housing bubble is enough of a man to admit that his advice was wrong and that he knew he was lying...

    ...but where does that leave his little followers like lance?

    Lance is too proud to admit he was wrong all these years, and too stupid to realize denying it just makes it worse.


    Remember folks, the bottom was in 2007, if you didn't buy then you are "screwed!"

    Thanks for the help lance!

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  15. David's mom is proud of him. (Both Davids)

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  16. "As I've said before, nobody cares about Arlington. It makes up less than 4% of the DC metro area's population, yet somehow it seems to make up 50% of the geographic area–specific Bubble Meter comments."

    This is the mystery of the housing bubble.

    You observe something, ie, "prices have held up inside the beltway while plunging in the boonies" and set off a fire storm of Leroy-esque speculation, ie, "It will fall, any day now, there, that proves you're wrong."

    What's really bizarre is how these speculations stick.

    1) "your neighborhood, your street, your house" - No, NO! It stopped outside the beltway.

    2) "realtors and desperate sellers are holding the choice houses off the market" - Why are the desperate sellers inside the beltway so much sneakier than the ones in PWC?

    3) "Substitution Effect, a treed Arlington lot is the same as anything in Manassas"

    4) "Commuting 3 hours each day is fun and normal."

    5) "I like riding VRE so everyone should."

    6) "My job lets me telecommute, so everyone else can telecommute."

    7) "I like mowing 4 acres, so everyone else does."

    How about, there are more people who want to live in Arlington (or Alexandria, DC, Falls Church) than there are places available. You can't just throw up a couple hundred tyvek cribs on a cow pasture. You want to live there, you pay the price.

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  17. "How about, there are more people who want to live in Arlington (or Alexandria, DC, Falls Church) than there are places available. You can't just throw up a couple hundred tyvek cribs on a cow pasture. You want to live there, you pay the price."

    Yep - it really is that simple. Little mystery behind it. Of course, the Leroys of the world wont accept this til years after the downturn is over - until then its all:

    Its only the 3rd inning

    Its moving in

    Arlington is not immune

    Sad really.

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  18. remember when he was on here (or someone posted a quote from him) about how his mother gets upset reading blogs that vilify him? this was 2006 or 2007.

    wonder what she thinks now?

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