tag:blogger.com,1999:blog-13164186.post6544293620265244525..comments2024-01-27T19:26:32.604-05:00Comments on Bubble Meter: Housing Graph. Case Shiller Index (Inflation Adjusted)Davidhttp://www.blogger.com/profile/11169148764438565562noreply@blogger.comBlogger38125tag:blogger.com,1999:blog-13164186.post-47226547198690970822009-04-05T16:56:00.000-04:002009-04-05T16:56:00.000-04:00History has not been kind to this Lance idiot. It ...History has not been kind to this Lance idiot. It is now march of 2009. I'm laughing so hard right now. Let me say it again. Lance, whoever you are, you are a twit.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-15424929990680123892008-11-24T18:23:00.000-05:002008-11-24T18:23:00.000-05:00Anonymous said..."Anybody have an updated shiller ...Anonymous said...<BR/><I>"Anybody have an updated shiller inflation-adjusted graph? I can't seem to google one out. Thanks!"</I><BR/><BR/>Robert Shiller's web site with data is <A HREF="http://www.irrationalexuberance.com/" REL="nofollow">here</A>.<BR/><BR/>Shiller's publicly available data for the past century is only annual data. Since 2008 is still not complete, that means you can only get data through 2007. I have a graph of the annual data <A HREF="http://housingbubble.jparsons.net/united_states_1890-2007.png" REL="nofollow">here</A>.<BR/><BR/>I have a graph of quarterly data for the past quarter century <A HREF="http://housingbubble.jparsons.net" REL="nofollow">here</A>.Jameshttps://www.blogger.com/profile/15243567377599238583noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-81371000257201943792008-11-24T12:17:00.000-05:002008-11-24T12:17:00.000-05:00Anybody have an updated shiller inflation-adjusted...Anybody have an updated shiller inflation-adjusted graph? I can't seem to google one out. Thanks!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-1295163809370860632007-10-05T17:08:00.000-04:002007-10-05T17:08:00.000-04:00"you will insist it can't happen in DC"It may happ..."you will insist it can't happen in DC"<BR/><BR/>It may happen but it has not happened yet.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-36537251597065643752007-10-04T19:56:00.000-04:002007-10-04T19:56:00.000-04:00Lance's quote:"The marginal declines you are seein...Lance's quote:<BR/>"The marginal declines you are seeing in marginal exurban and transitional neighborhood markets is just "business as usual" in the downside of a real estate market."<BR/><BR/>Oh yeah, tell that to those who lost their homes or home equity in the state of Florida or the state of California or the state of Arizona etc.<BR/>Still you will insist it can't happen in DC, but much like the way darkness follows the sun's setting, give it time, give it time.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-33466927175549936862007-10-04T15:20:00.000-04:002007-10-04T15:20:00.000-04:00Oh, and David, I looked for an e-mail address for ...Oh, and David, I looked for an e-mail address for you but couldn't find one - - thank you so much for getting rid of moderation! The lag times for reviewing and approving comments seemed to retard the dialog a bit..A Unique Aliashttps://www.blogger.com/profile/14537413176663919073noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-4261679862569051722007-10-04T08:32:00.000-04:002007-10-04T08:32:00.000-04:00"then you don't understand what a bubble is."This ..."then you don't understand what a bubble is."<BR/><BR/>This from the dunce that spent most of last year trying to redefine the word "bubble"... lol<BR/><BR/>Hey, why don't you get on the phone and call Greenspan, he has been talking about a bubble in real estate and according to lance's definition it is impossible to have a bubble in real estate!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-9963285485244714432007-10-03T22:32:00.000-04:002007-10-03T22:32:00.000-04:00This comment has been removed by the author.Lancehttps://www.blogger.com/profile/12216089306021385355noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-10750685565259831442007-10-03T22:25:00.000-04:002007-10-03T22:25:00.000-04:00Anon 12:00 pm,If you don't understand that David w...Anon 12:00 pm,<BR/><BR/>If you don't understand that David was wrong about prices declining in the fashion he'd thought they would, then you don't understand what a bubble is. The marginal declines you are seeing in marginal exurban and transitional neighborhood markets is just "business as usual" in the downside of a real estate market. It isn't a "bursting bubble". David knows that too. If he didn't, why would he keep predicting "<I>continuing</I> declining house prices. He needs for prices to continue to decline by <I> a lot</I> for his bubble to have burst. And it's just not happening ... even after all these years.Lancehttps://www.blogger.com/profile/12216089306021385355noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-10903025093702466892007-10-03T16:58:00.000-04:002007-10-03T16:58:00.000-04:00Hey, comment moderation is off.Hey, comment moderation is off.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-55392656904946815462007-10-03T16:55:00.000-04:002007-10-03T16:55:00.000-04:00"Though our "discussions" here seem to drift somet..."Though our "discussions" here seem to drift sometimes, I think most would agree the real point of this blog is housing prices and whether they will decline. If your point, Lance, is that you can say "nah, nah, Dave was wrong" about what will cause a recession and whether a recession will happen, but housing prices do in fact continue their decline, that isn't much of a victory. Oh, what's that, Lance? You say, "but if David was wrong about that, he is wrong about housing prices too?" Again, you are clinging to the little you have left to argue with."<BR/><BR/><BR/>I think it's fair to point out that David is an idiot.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-90545380955665989682007-10-03T15:00:00.000-04:002007-10-03T15:00:00.000-04:00Though our "discussions" here seem to drift someti...Though our "discussions" here seem to drift sometimes, I think most would agree the real point of this blog is housing prices and whether they will decline. If your point, Lance, is that you can say "nah, nah, Dave was wrong" about what will cause a recession and whether a recession will happen, but housing prices do in fact continue their decline, that isn't much of a victory. Oh, what's that, Lance? You say, "but if David was wrong about that, he is wrong about housing prices too?" Again, you are clinging to the little you have left to argue with.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-12469890701275434762007-10-03T11:49:00.000-04:002007-10-03T11:49:00.000-04:00Anon 6:10 said:"As you can see from today's news, ...Anon 6:10 said:<BR/>"As you can see from today's news, the stock market did well in spite of housing that day."<BR/><BR/>David has repeatedly stated that <I>a "declining real estate market" will cause a recession.</I> As the Wall Street article makes clear, the economy can continue to do just fine <I>in spite</I> of the effects of being in the downside of a real estate cycle. Thanks for helping me make my point!Lancehttps://www.blogger.com/profile/12216089306021385355noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-2963927401942522592007-10-03T09:10:00.000-04:002007-10-03T09:10:00.000-04:00Lance said..."Did you see what the Stock Market di...Lance said...<BR/>"Did you see what the Stock Market did today? Do you still think the problems of a relatively few over-extended mortgagees are going to cause a recession?"<BR/><BR/>----------------------------------<BR/>Lance, you often criticize "bubbleheads" for jumping on any one-day news story and basing long range claims/predictions on it. As you can see from today's news, the stock market did well in spite of housing that day, not because housing is getting better. Housing prices will likely continue to decline whether there is a recession or not. Of course, a recession would make it worse (or better, depending on your point of view.<BR/><BR/>-From today's WSJ-<BR/><BR/>A Day After Dow's Record,<BR/>Investors Take a Step Back<BR/>By PETER A. MCKAY<BR/>October 3, 2007; Page C1<BR/><BR/>The stock market suffered a mild hangover after the boisterous party Monday that ended in a fresh record for the Dow Jones Industrial Average.<BR/><BR/>The Dow finished yesterday off 40.24 points, or 0.3%, at 14047.31. It is still up 12.7% this year.<BR/><BR/>Investors' mood was damped by weak housing data and crude oil's rebound from a sharp early selloff to remain above the psychologically important price of $80 a barrel.....Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-88873556141360884582007-10-02T17:31:00.000-04:002007-10-02T17:31:00.000-04:00Lance said..."Did you see what the Stock Market di...Lance said...<BR/><I>"Did you see what the Stock Market did today? Do you still think the problems of a relatively few over-extended mortgagees are going to cause a recession?"</I><BR/><BR/>I think David was wrong in his prediction of a recession. While the odds of a recession in the next 12 months are higher than normal, the odds are less than 50/50.<BR/><BR/><A HREF="http://politicalcalculations.blogspot.com/2006/04/reckoning-odds-of-recession.html" REL="nofollow">Here is a little tool</A> to help predict the odds of a recession in the next 12 months. To use the tool correctly, you need the Federal Funds Rate (4.75%) and Treasury Bond Yields, available <A HREF="http://www.treas.gov/offices/domestic-finance/debt-management/interest-rate/yield.shtml" REL="nofollow">here</A>.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-46268348876026043352007-10-02T17:17:00.000-04:002007-10-02T17:17:00.000-04:00"In the past real prices were always higher than n...<I>"In the past real prices were always higher than nominal prices on your chart. Doesn't that mean this is a buying opportunity?"</I><BR/><BR/>No, it doesn't mean it's a good buying opportunity. You don't seem to have a good understanding of how inflation-adjustment works. <B>It doesn't matter at all which line is above which.</B> The only line you should really care about is the real prices line.<BR/><BR/>If I drew a graph of toothpaste prices using the current year as the base year, then the real dollars line would be above the nominal dollars line. However, if I drew the graph of toothpaste prices with the first year as the base year, then the real dollars line would be below the nominal dollars line. Really, the only thing you should care about is the inflation-adjusted (real) price of toothpaste over time.<BR/><BR/>The same goes for housing. The only thing you should care about is the inflation-adjusted (real) price of housing over time. Since the real price of housing is higher today than it was in the past, it means that a buyer today would pay more for the house than they would have in the past. I drew the nominal dollars line for housing just to give people more information. I assume most people understand what they are looking at.<BR/><BR/>One caveat: once you start using financial leverage (e.g. a mortgage), then nominal price changes do start to matter, because leverage accentuates your percentage gains and accentuates your percentage losses. However, nominal price changes only matter during the time you own your home. As the saying goes, buy low, sell high. People buying today would be doing the opposite.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-8366936819421120182007-10-02T10:55:00.000-04:002007-10-02T10:55:00.000-04:00James,In the past real prices were always higher t...James,<BR/><BR/>In the past real prices were always higher than nominal prices on your chart. Doesn't that mean this is a buying opportunity?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-48616329114190319512007-10-02T01:46:00.000-04:002007-10-02T01:46:00.000-04:00"James, your chart would be more graphically usefu...<I>"James, your chart would be more graphically useful of you used a year in the past as the base year rather than 2007, even though the same point is made (just not as obviously)."</I><BR/><BR/>Since the point of the graph is to show people what today's houses were worth in the past, the current year must be the base year. Most people think in current (2007) dollars, so that's what the graph reflects.<BR/><BR/>Furthermore, I am restricted by the data I have access to. Because of new house construction, today's houses are different from 1987's houses. I don't have the value of 1987's median-priced existing single-family home, so I can't honestly use 1987 as the base year. I only have 1) today's median-priced single-family home as reported by NAR, 2) the Case/Shiller Index, and 3) the CPI. What you are suggesting might make a pretty graph, but the data would be completely fictional.<BR/><BR/>If I were only reporting the Case/Shiller Index, then I could use 1987 as the base year. However, I believe most visitors can conceptualize the bubble better if they see dollar values, rather than abstract index values. Since I do have the 2007 median price, but not the 1987 median price, I must use 2007 as the base year to have an honest and accurate graph.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-5185907144938196482007-10-01T20:43:00.000-04:002007-10-01T20:43:00.000-04:00I'm sure your good friend from Cleveland would be ...<I> I'm sure your good friend from Cleveland would be glad to know you're happy about that. </I><BR/><BR/>Happy? No. You completely missed the point. When markets go weak, they can get very weak.<BR/><BR/>And as far as job security... better to rent with a well invested nest egg than be stuck with a home that cannot be sold when a job (better job?) is but a short move away.<BR/><BR/><BR/>Bulls... instead of trying to win a point by name calling (that doesn't work after grade school), why don't you talk to your banker friends? They might have something interesting to say. Mine sure do.<BR/><BR/>I'm sure everyone is looking at the September preliminary statistics coming out. OUCH! Can we say debt exhaustion?<BR/><BR/>Got popcorn?<BR/>Neilwannabuyhttps://www.blogger.com/profile/04297458705683991405noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-5406681837491370932007-10-01T18:37:00.000-04:002007-10-01T18:37:00.000-04:00Dave,Did you see what the Stock Market did today? ...Dave,<BR/><BR/>Did you see what the Stock Market did today? Do you still think the problems of a relatively few over-extended mortgagees are going to cause a recession?Lancehttps://www.blogger.com/profile/12216089306021385355noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-81630485395565421042007-10-01T09:11:00.000-04:002007-10-01T09:11:00.000-04:00James, your chart would be more graphically useful...James, your chart would be more graphically useful of you used a year in the past as the base year rather than 2007, even though the same point is made (just not as obviously).<BR/><BR/>Today's real prices are far above the historical current prices. Your's says past real prices were far above the nominal price. While they both are the same thing, one is clearer than the other.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-75482924648391591562007-10-01T08:56:00.000-04:002007-10-01T08:56:00.000-04:00"And those condos are still coming onto the market..."And those condos are still coming onto the market. Think its bad now? Wait. I talked to a guy from Cleveland yesterday; they have a complete meltdown there. He's selling a home he bought in 1993 for $200k for $180k. OUCH!"<BR/><BR/>I'm sure your good friend from Cleveland would be glad to know you're happy about that.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-13164186.post-25805457637385921892007-09-30T23:59:00.000-04:002007-09-30T23:59:00.000-04:00oh wait a second. Its going up!Great point. Look a...<I>oh wait a second. Its going up!</I><BR/><BR/>Great point. Look at the NOVA inventory stats on VirginiaMLS.com. They're at an all-time high for the year:<BR/><BR/>http://www.virginiamls.com/charts/index.htmWard 5 Residenthttps://www.blogger.com/profile/12744461210924477998noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-16421385804956421402007-09-30T23:10:00.000-04:002007-09-30T23:10:00.000-04:00Lance said... "there is never a bad time to buy" J...Lance said... <BR/>"there is never a bad time to buy" <BR/>July 28, 2006 3:14 PMroberthttps://www.blogger.com/profile/10354810363004791622noreply@blogger.comtag:blogger.com,1999:blog-13164186.post-64367980118035274352007-09-30T21:59:00.000-04:002007-09-30T21:59:00.000-04:00It will do you little good if a collapse of the ho...It will do you little good if a collapse of the housing market takes down the economy. The price of housing will fall dramatically, but you might be out of a job, or forced to take a much lower paying job. On the other hand, if you have a secure job and a lot of cash, then wait for the inevitable price correction. But bear in mind that desirable housing usually sells quickly in any market short of an actual depression. I saw this happen in the mid 1990s in Northern California. Desirable properties sold immediately at a good price. The junk hung around for years, in many cases sitting empty. I was looking to buy at the time (for cash), and was astounded by the stupidity of the sellers. One piece of junk was especially memorable. It was overpriced and did not sell. The owner took it off the market, and spent $100k on a new improved retaining wall. Then he listed it at a $100k increase in price. My realtor brought me back to the property thinking I would be so impressed by the new retaining wall I would want to buy it. I eventually found a good property at a good price just before the bubble. I sold it at the peak. Real estate has been good to me, but it required a lot of patience, and a business-like non-emotional approach to house hunting. In general it helps not to have a wife with you.Anonymousnoreply@blogger.com