Here we go again (Low low down payment)

[CA renter]

It doesn’t matter whether or not the underlying conditions are sustainable? Of course, these conditions can last far longer than most skeptics would think imaginable, but I’d venture to guess that when the SHTF moment does occur, the duration and extent of the manipulations will be mirrored in the final aftermath, and then some.

[The-Shoveler]

“when the SHTF moment does occur”

They will have learned a lot from the last time and be much better able to mask the issues the next time IMO.

Although IMO they pretty much knew exactly how it was going to play out in 2008 and it was planned for as well.

[an]

[quote=CA renter]It doesn’t matter whether or not the underlying conditions are sustainable? Of course, these conditions can last far longer than most skeptics would think imaginable, but I’d venture to guess that when the SHTF moment does occur, the duration and extent of the manipulations will be mirrored in the final aftermath, and then some.[/quote]It doesn’t matter whether or not the underlying conditions are sustainable or not. It doesn’t change my statement, which states that we didn’t have a crash in 2001. Which is why I ask him why he picked 2001. If today is 2001, I would be quite happy.

[an]

[quote=The-Shoveler]”when the SHTF moment does occur”

They will have learned a lot from the last time and be much better able to mask the issues the next time IMO.

Although IMO they pretty much knew exactly how it was going to play out in 2008 and it was planned for as well.[/quote]Exactly.

[bobby]

[quote=CA renter][quote=bobby][quote=spdrun]If you think about it, it wasn’t such a hot year for NY-area real estate. Nor SFBA property. ;)[/quote]

SFBA went CRAZY this year. It was 10-30% 1 year gain in most areas.
I bought a primary residence but now looking for a rental. It had been insane. Holding off until things turn downward a little (hopefully)

http://www.mercurynews.com/business/ci_26514018/august-slowdown-hits-bay-area-housing-market%5B/quote%5D

I think he meant in ~2001, when the .com/stock market crashed.[/quote]

well… serves me right for not reading thoroughly before commenting.

[FlyerInHi]

[quote=AN][quote=The-Shoveler]”when the SHTF moment does occur”

They will have learned a lot from the last time and be much better able to mask the issues the next time IMO.

Although IMO they pretty much knew exactly how it was going to play out in 2008 and it was planned for as well.[/quote]Exactly.[/quote]

Does that mean the stimulus and Fed policies were successes?

[The-Shoveler]

Depends

First they were at Fault for the mess IMO.

Second if they did not do massive intervention in 2008-now it would have been really really bad for most people.

People sitting on a boat load of cash in a CD may have been better off however LOL.

[poorgradstudent]

Considering it looks like we’re finally seeing significant jobs driven wage growth, that alone is going to fuel the housing market for a couple years until things slow down. Plus the economy usually loves it when the President and Congress are controlled by different parties; no one can change anything, and stability is good for making future plans. Of course the Dems will retake the Senate in 2016 and the Presidency may (but probably won’t) switch parties, so once the election rodeo starts up it may spook the market.

[FlyerInHi]

[quote=The-Shoveler]Depends

First they were at Fault for the mess IMO.

Second if they did not do massive intervention in 2008-now it would have been really really bad for most people.

People sitting on a boat load of cash in a CD may have been better off however LOL.[/quote]

I pretty much agree. “most people” as in the economy in general or GDP growth is what policy makers should be concerned about.

Personally, I think that I would’ve done fairly well without stimulus or Fed intervention. In 2008, I only had a small mortgage about $100k on a rental house. It would have given me a bigger window of opportunity to buy real estate.

[The-Shoveler]

If they had let it run it course it would have been much much worse, and could have cause a total collapse.

Assets is what holds up the banks (and the economy in general), it’s a catch 22, once you run them up, you cannot allow them to collapse else the whole thing goes,

It’s something I think many failed to see.

[an]

[quote=FlyerInHi][quote=AN][quote=The-Shoveler]”when the SHTF moment does occur”

They will have learned a lot from the last time and be much better able to mask the issues the next time IMO.

Although IMO they pretty much knew exactly how it was going to play out in 2008 and it was planned for as well.[/quote]Exactly.[/quote]

Does that mean the stimulus and Fed policies were successes?[/quote]Depends on what you consider success. But definitely, don’t fight the fed.

[livinincali]

[quote=The-Shoveler]If they had let it run it course it would have been much much worse, and could have cause a total collapse.

Assets is what holds up the banks (and the economy in general), it’s a catch 22, once you run them up, you cannot allow them to collapse else the whole thing goes,

It’s something I think many failed to see.[/quote]

You’re arguing that the math doesn’t matter. You might be able to postpone the realization that the other side of the balance sheet holds nothing for awhile but eventually it’s going to matter. Of course there’s another crash baked into the current bubble and people are falling for it again. That’s what;s surprising to me. This unwavering faith in the fed having your back. It’s worthless to argue about it now, most won’t see it until it becomes hindsight.

[The-Shoveler]

I do agree with you in one respect, it is pointless to argue about it.

Inflation does happen however, see what happens in china, they are the masters at this game. They have something the Fed cannot, total control.

[FlyerInHi]

[quote=AN]Depends on what you consider success. But definitely, don’t fight the fed.[/quote]

Success meaning GDP growth, an overall richer country. I take that so mean the Federal government and Federal Reserve did the right things by the economy.

[FlyerInHi]

[quote=livinincali]
You’re arguing that the math doesn’t matter. You might be able to postpone the realization that the other side of the balance sheet holds nothing for awhile but eventually it’s going to matter. Of course there’s another crash baked into the current bubble and people are falling for it again. That’s what;s surprising to me. This unwavering faith in the fed having your back. It’s worthless to argue about it now, most won’t see it until it becomes hindsight.[/quote]

What other side of the Federal Reserve balance sheet? Please elaborate. Are you saying the assets are worthless or that there are unknown liabilities?

Let’s look at the math.

Scenario 1:
– Say prior to recession peak GDP was 1.0.
– 2008 Great Recession occurred and GDP hit a low of .90.
– After government intervention, GDP is now 1.1. Success!!

Scenario 2:
– Had the government not intervened, GDP may have dropped to a depression low of .70. Terrible suffering and drop in standard of living.
– Digging ourselves out the depression, we may have experienced faster growth and are now at .95.

Scenario 2 is clearly less appealing to the country and represents self-inflicted pain. I doubt anyone is glutton for punishment.

So what if an other recession is baked into government intervention? Does it matter? So long as GPD remains above .95 + some annual growth (all else being equal, of course), then government intervention was clearly preferable.

The government’s job is to protect and improve our aggregate standard of living.

[Author]

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