tag:blogger.com,1999:blog-13164186.post115073652837538402..comments2024-01-27T19:26:32.604-05:00Comments on Bubble Meter: Where are the Greater Fools?Davidhttp://www.blogger.com/profile/11169148764438565562noreply@blogger.comBlogger72125tag:blogger.com,1999:blog-13164186.post-1150996935505269892006-06-22T13:22:00.000-04:002006-06-22T13:22:00.000-04:00Or are you looking at change in strength (measured...Or are you looking at change in strength (measured by YoY price change), rather than absolute strength (measured by the equilibrium price)?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150994632412094282006-06-22T12:43:00.000-04:002006-06-22T12:43:00.000-04:00Or are you unfamiliar with either the term "roughl...Or are you unfamiliar with either the term "roughly" or "two decades"? (To be precise, 1997 was the weakest of the past 19 years.)Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150994064206370272006-06-22T12:34:00.000-04:002006-06-22T12:34:00.000-04:00anonymous wrote:"I know reading is hard, but why c...anonymous wrote:<BR/>"I know reading is hard, but why can't you read a graph? It's just pictures."<BR/><BR/>What the hell are you talking about? Do you not know the difference between inflation-adjusted and nominal prices?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150949283882742682006-06-22T00:08:00.000-04:002006-06-22T00:08:00.000-04:00"Yesterday, you were saying the housing starts num..."Yesterday, you were saying the housing starts numbers were bad for the housing market. Surely this is good news then."<BR/><BR/>One item is being overlooked in the discussion on housing starts. Builders have an incentive to build - even if there are fewer buyers right now, rising inventory, and building defies business sense. Why? <BR/><BR/>Because builders who don't build are unemployed. And no one willingly fires themselves.<BR/><BR/>Housing start numbers will drop again. Builders are using cheap money still available in a last gasp before the housing market starts to "correct" itself, leading to lower start numbers and more layoffs once the low summer sales numbers come out.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150938055851484402006-06-21T21:00:00.000-04:002006-06-21T21:00:00.000-04:00"Beware False Housing Hopes"Sure, construction sta..."Beware False Housing Hopes<BR/>"Sure, construction starts rose in May. But the key indicator of permits fell for the fourth consecutive month and homebuilders are gloomy."<BR/><BR/>I have a new post on my blog to discuss this."<BR/><BR/>Stein,<BR/><BR/>Yesterday, you were saying the housing starts numbers were bad for the housing market. Surely this is good news then.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150937889399189192006-06-21T20:58:00.000-04:002006-06-21T20:58:00.000-04:00"For the Washington, DC metro area, 1997 was the w..."For the Washington, DC metro area, 1997 was the weakest year in roughly the past two decades. I have the inflation-adjusted data here:<BR/><BR/>http://mysite.verizon.net/vodkajim/housingbubble/washington.htm"<BR/><BR/>I know reading is hard, but why can't you read a graph? It's just pictures.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150929178500336862006-06-21T18:32:00.000-04:002006-06-21T18:32:00.000-04:00It looks like I don't need to read the report. Ne...It looks like I don't need to read the report. Neither does mytwocents.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150928879812716222006-06-21T18:27:00.000-04:002006-06-21T18:27:00.000-04:00If you guys are seriously interested in what may h...If you guys are seriously interested in what may happen during a housing bust, in 2003 the International Monetary Fund wrote a report titled "When Bubbles Burst". It discusses the bursting of asset price bubbles, and how housing busts differ from stock market busts.<BR/><BR/>The IMF writes, "...equity price busts occurred on average every 13 years, lasted for 2-1/2 years, and were associated with GDP losses of about 4 percent of GDP. Housing price busts were less frequent, but lasted nearly twice as long and were associated with output losses that were twice as large, reflecting greater effects on consumption and banking systems, which are typically heavily exposed to real estate...."<BR/><BR/>"...the average equity price decline amounted to 60 percent.... the price corrections during housing price busts averaged 30 percent, reflecting the lower volatility of housing prices and the lower liquidity in housing markets."<BR/><BR/>Here's the full report:<BR/>http://www.imf.org/external/pubs/ft/weo/2003/01/pdf/chapter2.pdfAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150926950221492672006-06-21T17:55:00.000-04:002006-06-21T17:55:00.000-04:00dc,You are right about the lenders. In the early ...dc,<BR/><BR/>You are right about the lenders. In the early to mid 90's if you said you were an "investor", the lenders treated you like a criminal. You could only have 5 mortgages or you couldn't get financed unless you were buying a personal residence.<BR/><BR/>Even then, I had a Lender's underwriter refuse to believe I was going to occupy a house. This with perfect credit and job history etc.<BR/><BR/>Typical "closing the barn door...".<BR/><BR/>Eight percent doesn't scare me. As I said before, I'll just go with history and say declines of up to 25% for houses and 40% for condo's. Absent another 9/11 or worse economic shock.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150923759279419692006-06-21T17:02:00.000-04:002006-06-21T17:02:00.000-04:00VA Investor,I think you and I came to similar conc...VA Investor,<BR/><BR/>I think you and I came to similar conclusions through different methods. You said a 40% drop for some of the highest priced condos based on past cycles.<BR/><BR/>I said, take the 98-01 median price line trend and add 4%/year + 20% of base price for basic asset class appreciation (due to easier lending as a result of a more competitive banking industry).<BR/><BR/>I believe my estimate was closer to a 45% drop off but they're in the same general ballpark. <BR/><BR/>Whether prices drop to get to this point or stagnate doesn't really matter to me. I just envision this point as when the market will be close to rational again.<BR/><BR/>My $0.02.MyTwoCentshttps://www.blogger.com/profile/10642606797401998999noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150923155658006262006-06-21T16:52:00.000-04:002006-06-21T16:52:00.000-04:00steinravnik wrote:"I will link to your blog."Thank...steinravnik wrote:<BR/><I>"I will link to your blog."</I><BR/><BR/>Thank you. It is nice to see that your blog is active again, especially since the mysterious demise of OverPricedDC.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150922611594638772006-06-21T16:43:00.000-04:002006-06-21T16:43:00.000-04:00dc_too,and, so?How much lower dc? Enlighten us.dc_too,<BR/><BR/>and, so?<BR/><BR/>How much lower dc? Enlighten us.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150922102407974772006-06-21T16:35:00.000-04:002006-06-21T16:35:00.000-04:00Stein, twocents and James,I am glad that the build...Stein, twocents and James,<BR/><BR/>I am glad that the builders may have learned something from past mistakes. I talked to a paver recently. He said projects are getting "erased" (cancelled) left and right.<BR/><BR/>Problem is, some projects are too far along to get cancelled. We just have to work through the inventory - same as before.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150921532410420092006-06-21T16:25:00.000-04:002006-06-21T16:25:00.000-04:00James,There you go again, posting the relevant fac...James,<BR/><BR/>There you go again, posting the relevant facts and essentially ending the discussion. I thought we wanted discourse? :)<BR/><BR/>My $0.02.MyTwoCentshttps://www.blogger.com/profile/10642606797401998999noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150919717252447572006-06-21T15:55:00.000-04:002006-06-21T15:55:00.000-04:00steinravnik,That widely-publicized 5% number is co...steinravnik,<BR/>That widely-publicized 5% number is compared to the previous month. But May 2006 housing starts are DOWN year-over-year.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150918396542956342006-06-21T15:33:00.000-04:002006-06-21T15:33:00.000-04:00"the weakest level this year since 1997."Which was...<I>"the weakest level this year since 1997."<BR/><BR/>Which was a strong year, moron.</I><BR/><BR/>For the Washington, DC metro area, 1997 was the weakest year in roughly the past two decades. I have the inflation-adjusted data here:<BR/><BR/>http://mysite.verizon.net/vodkajim/housingbubble/washington.htmlAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150918149235142742006-06-21T15:29:00.000-04:002006-06-21T15:29:00.000-04:00Good Lord! What an echo chamber of inanity this si...Good Lord! What an echo chamber of inanity this site has become. There is attempt at reasoned debate. There is only renters looking to other renters for validation as to their economic choices. And of course, anyone who doesn't subscribe to the bubble dogma is either a real estate agent, a flipper, or a hurting investor. You get more reasoned debate from an elementary school child.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150916623824058772006-06-21T15:03:00.000-04:002006-06-21T15:03:00.000-04:00"The realtors would have no interest in being on h..."The realtors would have no interest in being on here 'cause it's not like they're going to get new business from those bubbleheads that either can't or won't buy ...."<BR/><BR/>Yeah...sure...I know for a fact that there are a couple od "realtors" that as of this minute are surfing the net, logging in to their "space" or otherwise pretending to be busy....They might be actually **busy** tomorrow and friday, though, when they start to prepare for weekend openhouse traffic (or lack thereof).Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150913614509671232006-06-21T14:13:00.000-04:002006-06-21T14:13:00.000-04:00"Of what value are anonomously posted insults, any..."Of what value are anonomously posted insults, anyway? If anything, it suggests that fear may be beginning to set in among those whose livelihoods are linked to the bubble."<BR/><BR/>Like the fear you feel every time you walk outdoors in your neighborhood?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150913544029933152006-06-21T14:12:00.000-04:002006-06-21T14:12:00.000-04:00"the weakest level this year since 1997."Which was..."the weakest level this year since 1997."<BR/><BR/>Which was a strong year, moron.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150913498060020022006-06-21T14:11:00.000-04:002006-06-21T14:11:00.000-04:00"steinravnik said... "I pointed out that David for..."steinravnik said... <BR/>"I pointed out that David forgot to support his assertion that the spring buying season has been weak with, you know, FACTS, and he deleted the post."<BR/><BR/>Go to MRIS.com and look at sales for the past 10 years. Or if visuals help you, go to my blog, I have it graphed out for 10 years. Sales are weak compared to a year ago, and are at the weakest level this year since 1997.<BR/>"<BR/><BR/>Stein,<BR/><BR/>you're having trouble following again. We're talking about David's assertion that spring has been weak. He "forgot" to support it with any facts, and you haven't helped him.<BR/><BR/>"Too funny. Where are your facts, Sunny Jim, showing a brisk spring season? "<BR/><BR/>Not out yet, because the stats show closing, not contracts. Then again, I didn't write a diatribe on a blog about a brisk spring season.<BR/><BR/>No go back to your rental home in the ghetto. It's funnier when you give your financial advice from there.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150910202126944042006-06-21T13:16:00.000-04:002006-06-21T13:16:00.000-04:00dc_too,It harms the integrity of his blog when he ...dc_too,<BR/><BR/>It harms the integrity of his blog when he edits so heavily. I'd rather sift through the comments myself than have to rely on David's opinion regarding relevance and insults.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150909744595884482006-06-21T13:09:00.000-04:002006-06-21T13:09:00.000-04:00Don't you think most of us have the intelligence t...Don't you think most of us have the intelligence to disregard inane comments. Apparently, David thinks we need his protection.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150909056357997672006-06-21T12:57:00.000-04:002006-06-21T12:57:00.000-04:00David's deletions are over the top.David's deletions are over the top.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1150908936711250992006-06-21T12:55:00.000-04:002006-06-21T12:55:00.000-04:00I pointed out that David forgot to support his ass...I pointed out that David forgot to support his assertion that the spring buying season has been weak with, you know, FACTS, and he deleted the post.Anonymousnoreply@blogger.com