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sdnerd.
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March 12, 2008 at 11:30 PM #12090March 12, 2008 at 11:57 PM #168409
cashflow
ParticipantBest quote in this, ‘what’s unthinkable today may be seen the best of bad alternatives tomorrow’. Doesn’t that summerize the situation!
I think this is the biggest unknown in housing today; what is the government going to do and how will it impact the market? They will do everything they can to intervene in bank collapse or total market collapse (like the piggs on here are all predicting is possible). They have many more tools than they did in the depression era…so depression, just don’t see it…recession definitely. Implementing these type of bailout programs seems to be even trickier than inventing them. All I know is this type of rhetoric came too late for many many homeowners who have already been kicked out or are in the process…just doesn’t seem like they can implement anything fast enough (gov. isn’t known for it speed and agility to react).
March 12, 2008 at 11:57 PM #168844ParticipantBest quote in this, ‘what’s unthinkable today may be seen the best of bad alternatives tomorrow’. Doesn’t that summerize the situation!
I think this is the biggest unknown in housing today; what is the government going to do and how will it impact the market? They will do everything they can to intervene in bank collapse or total market collapse (like the piggs on here are all predicting is possible). They have many more tools than they did in the depression era…so depression, just don’t see it…recession definitely. Implementing these type of bailout programs seems to be even trickier than inventing them. All I know is this type of rhetoric came too late for many many homeowners who have already been kicked out or are in the process…just doesn’t seem like they can implement anything fast enough (gov. isn’t known for it speed and agility to react).
March 12, 2008 at 11:57 PM #168768ParticipantBest quote in this, ‘what’s unthinkable today may be seen the best of bad alternatives tomorrow’. Doesn’t that summerize the situation!
I think this is the biggest unknown in housing today; what is the government going to do and how will it impact the market? They will do everything they can to intervene in bank collapse or total market collapse (like the piggs on here are all predicting is possible). They have many more tools than they did in the depression era…so depression, just don’t see it…recession definitely. Implementing these type of bailout programs seems to be even trickier than inventing them. All I know is this type of rhetoric came too late for many many homeowners who have already been kicked out or are in the process…just doesn’t seem like they can implement anything fast enough (gov. isn’t known for it speed and agility to react).
March 12, 2008 at 11:57 PM #168741ParticipantBest quote in this, ‘what’s unthinkable today may be seen the best of bad alternatives tomorrow’. Doesn’t that summerize the situation!
I think this is the biggest unknown in housing today; what is the government going to do and how will it impact the market? They will do everything they can to intervene in bank collapse or total market collapse (like the piggs on here are all predicting is possible). They have many more tools than they did in the depression era…so depression, just don’t see it…recession definitely. Implementing these type of bailout programs seems to be even trickier than inventing them. All I know is this type of rhetoric came too late for many many homeowners who have already been kicked out or are in the process…just doesn’t seem like they can implement anything fast enough (gov. isn’t known for it speed and agility to react).
March 12, 2008 at 11:57 PM #168739ParticipantBest quote in this, ‘what’s unthinkable today may be seen the best of bad alternatives tomorrow’. Doesn’t that summerize the situation!
I think this is the biggest unknown in housing today; what is the government going to do and how will it impact the market? They will do everything they can to intervene in bank collapse or total market collapse (like the piggs on here are all predicting is possible). They have many more tools than they did in the depression era…so depression, just don’t see it…recession definitely. Implementing these type of bailout programs seems to be even trickier than inventing them. All I know is this type of rhetoric came too late for many many homeowners who have already been kicked out or are in the process…just doesn’t seem like they can implement anything fast enough (gov. isn’t known for it speed and agility to react).
March 13, 2008 at 12:02 AM #168744SD Realtor
ParticipantI pretty much share your assessment. It just bums me out for alot of reasons. I agree that this will not stop the cycle but it may indeed slow things down and it may provide an artificially induced floor. As someone who has been working hard to save alot of money this irritates me. Oh yeah and watching my tax money get split up between bailout wall street lenders, and FBS, well that is just a cherry on top of the sundae.
SD Realtor
March 13, 2008 at 12:02 AM #168773ParticipantI pretty much share your assessment. It just bums me out for alot of reasons. I agree that this will not stop the cycle but it may indeed slow things down and it may provide an artificially induced floor. As someone who has been working hard to save alot of money this irritates me. Oh yeah and watching my tax money get split up between bailout wall street lenders, and FBS, well that is just a cherry on top of the sundae.
SD Realtor
March 13, 2008 at 12:02 AM #168745ParticipantI pretty much share your assessment. It just bums me out for alot of reasons. I agree that this will not stop the cycle but it may indeed slow things down and it may provide an artificially induced floor. As someone who has been working hard to save alot of money this irritates me. Oh yeah and watching my tax money get split up between bailout wall street lenders, and FBS, well that is just a cherry on top of the sundae.
SD Realtor
March 13, 2008 at 12:02 AM #168848ParticipantI pretty much share your assessment. It just bums me out for alot of reasons. I agree that this will not stop the cycle but it may indeed slow things down and it may provide an artificially induced floor. As someone who has been working hard to save alot of money this irritates me. Oh yeah and watching my tax money get split up between bailout wall street lenders, and FBS, well that is just a cherry on top of the sundae.
SD Realtor
March 13, 2008 at 12:02 AM #168415ParticipantI pretty much share your assessment. It just bums me out for alot of reasons. I agree that this will not stop the cycle but it may indeed slow things down and it may provide an artificially induced floor. As someone who has been working hard to save alot of money this irritates me. Oh yeah and watching my tax money get split up between bailout wall street lenders, and FBS, well that is just a cherry on top of the sundae.
SD Realtor
March 13, 2008 at 12:05 AM #168854capeman
ParticipantThis won't happen…
There are two very relevant statements in there that contradict the argument and put a nail in the idea.
1) The Fed is trading some U.S. Treasurys for mortgage-backed securities to arrest the decline in prices that is pushing up mortgage-interest rates.
These are only temporary trades or swaps. The Fed cannot permanently trade U.S. Treasuries representing it's own assets for junk securities. The bond market would make them pay dearly for this. The swap occurs since the U.S. Treasuries need to be traded back to the Fed at maturity and then the Fed can reinitiate the trade again (likely accepting securities backed by assets of even less value).
2) One big caveat: This works only if assets truly are worth more tomorrow than they'll fetch today.
Who at this point thinks that any lending banks assets will be worth more in the near future than they are today? (Hint: That's why the S&P and Banking Index have been doing so well over the last year!) An even bigger and easier question at this point… Who thinks that the assets backing all of this paper being passed around will be worth more tomorrow than currently? Anyone looking at an ABX, CMBX or CDO spread chart or Case/Schiller HPI can answer this… actually I don't think anyone even has to look anymore!!
The Fed and the Govt' cannot bailout the housing and credit markets at this point without BKing both entities and causing post WWI German-style inflation. Not going to happen! 😉
March 13, 2008 at 12:05 AM #168749ParticipantThis won't happen…
There are two very relevant statements in there that contradict the argument and put a nail in the idea.
1) The Fed is trading some U.S. Treasurys for mortgage-backed securities to arrest the decline in prices that is pushing up mortgage-interest rates.
These are only temporary trades or swaps. The Fed cannot permanently trade U.S. Treasuries representing it's own assets for junk securities. The bond market would make them pay dearly for this. The swap occurs since the U.S. Treasuries need to be traded back to the Fed at maturity and then the Fed can reinitiate the trade again (likely accepting securities backed by assets of even less value).
2) One big caveat: This works only if assets truly are worth more tomorrow than they'll fetch today.
Who at this point thinks that any lending banks assets will be worth more in the near future than they are today? (Hint: That's why the S&P and Banking Index have been doing so well over the last year!) An even bigger and easier question at this point… Who thinks that the assets backing all of this paper being passed around will be worth more tomorrow than currently? Anyone looking at an ABX, CMBX or CDO spread chart or Case/Schiller HPI can answer this… actually I don't think anyone even has to look anymore!!
The Fed and the Govt' cannot bailout the housing and credit markets at this point without BKing both entities and causing post WWI German-style inflation. Not going to happen! 😉
March 13, 2008 at 12:05 AM #168751ParticipantThis won't happen…
There are two very relevant statements in there that contradict the argument and put a nail in the idea.
1) The Fed is trading some U.S. Treasurys for mortgage-backed securities to arrest the decline in prices that is pushing up mortgage-interest rates.
These are only temporary trades or swaps. The Fed cannot permanently trade U.S. Treasuries representing it's own assets for junk securities. The bond market would make them pay dearly for this. The swap occurs since the U.S. Treasuries need to be traded back to the Fed at maturity and then the Fed can reinitiate the trade again (likely accepting securities backed by assets of even less value).
2) One big caveat: This works only if assets truly are worth more tomorrow than they'll fetch today.
Who at this point thinks that any lending banks assets will be worth more in the near future than they are today? (Hint: That's why the S&P and Banking Index have been doing so well over the last year!) An even bigger and easier question at this point… Who thinks that the assets backing all of this paper being passed around will be worth more tomorrow than currently? Anyone looking at an ABX, CMBX or CDO spread chart or Case/Schiller HPI can answer this… actually I don't think anyone even has to look anymore!!
The Fed and the Govt' cannot bailout the housing and credit markets at this point without BKing both entities and causing post WWI German-style inflation. Not going to happen! 😉
March 13, 2008 at 12:05 AM #168419ParticipantThis won't happen…
There are two very relevant statements in there that contradict the argument and put a nail in the idea.
1) The Fed is trading some U.S. Treasurys for mortgage-backed securities to arrest the decline in prices that is pushing up mortgage-interest rates.
These are only temporary trades or swaps. The Fed cannot permanently trade U.S. Treasuries representing it's own assets for junk securities. The bond market would make them pay dearly for this. The swap occurs since the U.S. Treasuries need to be traded back to the Fed at maturity and then the Fed can reinitiate the trade again (likely accepting securities backed by assets of even less value).
2) One big caveat: This works only if assets truly are worth more tomorrow than they'll fetch today.
Who at this point thinks that any lending banks assets will be worth more in the near future than they are today? (Hint: That's why the S&P and Banking Index have been doing so well over the last year!) An even bigger and easier question at this point… Who thinks that the assets backing all of this paper being passed around will be worth more tomorrow than currently? Anyone looking at an ABX, CMBX or CDO spread chart or Case/Schiller HPI can answer this… actually I don't think anyone even has to look anymore!!
The Fed and the Govt' cannot bailout the housing and credit markets at this point without BKing both entities and causing post WWI German-style inflation. Not going to happen! 😉
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