Lot’s of bloody noses on Wall Street today

[bob007]

denial is the easiest way to dodge the problem

[bob007]

denial is the easiest way to dodge the problem

[Coronita]

Rustico,

In any drastic recession like so many people seem to want (ok I should say depression), usually the little guys get hit first, followed by the upper middle class, followed by the rich. Super rich are always exempt. It really depends on who can weather the storm longer to clean out the rest of the folks.

Let’s say we have a recession/depression. House prices come crashing down. Great…But are you working in an industry immune from a pullback in the housing/finance/retail sectors? If the average joe is lose his/her job (or close to losing it), is he/she really going to have the guts and/or financial means to purchase a home at that point? Credit is tighting, interest rates are going up, and your wage/salary isn’t going to keep up. If you add to the mix the risk of more/less losing your job, the question will be, will average joe on an average income be able to take advantage of the depressed housing price? Perhaps a few piggingtons here are going to be able to take advantage of it, namely those that have already established wealth in a turbulent market. But I doubt most will…
(It would be interesting if we started a poll for folks here to poll (1) how many people here are “waiting” to buy a home and (2) how many people actually do when we’re in the middle of a big storm at fire-sale prices. )

I don’t doubt a downturn is going to happen. I’m predicting areas in outer fridges of San Diego are going to get hit the hardest..because looking at the demographics, the economics of the folks that live there are the first to be affected by a downturn…I would say, we haven’t seen anything close to what would happen in Temecula, Riverside, Oceanside….

I just don’t think many folks here really know what the implications are going to be for themselves. Anyway, like I said, it’s a waiting game. Hopefully, your own family can outlast most everyone else that gets hurt.

[Coronita]

Rustico,

In any drastic recession like so many people seem to want (ok I should say depression), usually the little guys get hit first, followed by the upper middle class, followed by the rich. Super rich are always exempt. It really depends on who can weather the storm longer to clean out the rest of the folks.

Let’s say we have a recession/depression. House prices come crashing down. Great…But are you working in an industry immune from a pullback in the housing/finance/retail sectors? If the average joe is lose his/her job (or close to losing it), is he/she really going to have the guts and/or financial means to purchase a home at that point? Credit is tighting, interest rates are going up, and your wage/salary isn’t going to keep up. If you add to the mix the risk of more/less losing your job, the question will be, will average joe on an average income be able to take advantage of the depressed housing price? Perhaps a few piggingtons here are going to be able to take advantage of it, namely those that have already established wealth in a turbulent market. But I doubt most will…
(It would be interesting if we started a poll for folks here to poll (1) how many people here are “waiting” to buy a home and (2) how many people actually do when we’re in the middle of a big storm at fire-sale prices. )

I don’t doubt a downturn is going to happen. I’m predicting areas in outer fridges of San Diego are going to get hit the hardest..because looking at the demographics, the economics of the folks that live there are the first to be affected by a downturn…I would say, we haven’t seen anything close to what would happen in Temecula, Riverside, Oceanside….

I just don’t think many folks here really know what the implications are going to be for themselves. Anyway, like I said, it’s a waiting game. Hopefully, your own family can outlast most everyone else that gets hurt.

[Coronita]

Rustico,

In any drastic recession like so many people seem to want (ok I should say depression), usually the little guys get hit first, followed by the upper middle class, followed by the rich. Super rich are always exempt. It really depends on who can weather the storm longer to clean out the rest of the folks.

Let’s say we have a recession/depression. House prices come crashing down. Great…But are you working in an industry immune from a pullback in the housing/finance/retail sectors? If the average joe is lose his/her job (or close to losing it), is he/she really going to have the guts and/or financial means to purchase a home at that point? Credit is tighting, interest rates are going up, and your wage/salary isn’t going to keep up. If you add to the mix the risk of more/less losing your job, the question will be, will average joe on an average income be able to take advantage of the depressed housing price? Perhaps a few piggingtons here are going to be able to take advantage of it, namely those that have already established wealth in a turbulent market. But I doubt most will…
(It would be interesting if we started a poll for folks here to poll (1) how many people here are “waiting” to buy a home and (2) how many people actually do when we’re in the middle of a big storm at fire-sale prices. )

I don’t doubt a downturn is going to happen. I’m predicting areas in outer fridges of San Diego are going to get hit the hardest..because looking at the demographics, the economics of the folks that live there are the first to be affected by a downturn…I would say, we haven’t seen anything close to what would happen in Temecula, Riverside, Oceanside….

I just don’t think many folks here really know what the implications are going to be for themselves. Anyway, like I said, it’s a waiting game. Hopefully, your own family can outlast most everyone else that gets hurt.

[one_muggle]

Just curious how the topic devolved from a discussion on the Dow dropping a few percent to praying for soup kitchens and messages of hope that ‘my’ family can weather the impending repeat of Grapes of Wrath.
The market has been shrugging off bad news and ignoring risk for a bit too long, and it now shows signs of becoming more rational. As a buy and hold investor, that brings me joy since I can buy at a discount. How exactly is that praying for a recession? As if the economy ever cared what my hopes were anyway.
Also, these veiled “hopes that my family can weather the storm” are actually quite presumptuous and condescending. As I have said, I’ve no concern for me–believe it or don’t. If my portfolio goes to zero (which would be hard since I’m cash heavy), I lose my house, and my job (which is unlikely), I am still OK–but thanks for the concern.
Also, I never have and still do not wish ruination upon others. I also do not expect this real estate meltdown to ruin hordes of people, at least not anymore than did the S&L bust or Tech bubble.
BTW: Unemployment has been sub double digit since WWII, ignoring some imperfections in the number, that means 90% or more people have had jobs for almost 70 years. I doubt many of you old timers were alive, never mind working before then. http://www.bls.gov/cps/cpsaat1.pdf

Perhaps you are worried about a depression rather than a recession?

Truly hoping you all stay solvent,
-one muggle

[one_muggle]

Just curious how the topic devolved from a discussion on the Dow dropping a few percent to praying for soup kitchens and messages of hope that ‘my’ family can weather the impending repeat of Grapes of Wrath.
The market has been shrugging off bad news and ignoring risk for a bit too long, and it now shows signs of becoming more rational. As a buy and hold investor, that brings me joy since I can buy at a discount. How exactly is that praying for a recession? As if the economy ever cared what my hopes were anyway.
Also, these veiled “hopes that my family can weather the storm” are actually quite presumptuous and condescending. As I have said, I’ve no concern for me–believe it or don’t. If my portfolio goes to zero (which would be hard since I’m cash heavy), I lose my house, and my job (which is unlikely), I am still OK–but thanks for the concern.
Also, I never have and still do not wish ruination upon others. I also do not expect this real estate meltdown to ruin hordes of people, at least not anymore than did the S&L bust or Tech bubble.
BTW: Unemployment has been sub double digit since WWII, ignoring some imperfections in the number, that means 90% or more people have had jobs for almost 70 years. I doubt many of you old timers were alive, never mind working before then. http://www.bls.gov/cps/cpsaat1.pdf

Perhaps you are worried about a depression rather than a recession?

Truly hoping you all stay solvent,
-one muggle

[one_muggle]

Just curious how the topic devolved from a discussion on the Dow dropping a few percent to praying for soup kitchens and messages of hope that ‘my’ family can weather the impending repeat of Grapes of Wrath.
The market has been shrugging off bad news and ignoring risk for a bit too long, and it now shows signs of becoming more rational. As a buy and hold investor, that brings me joy since I can buy at a discount. How exactly is that praying for a recession? As if the economy ever cared what my hopes were anyway.
Also, these veiled “hopes that my family can weather the storm” are actually quite presumptuous and condescending. As I have said, I’ve no concern for me–believe it or don’t. If my portfolio goes to zero (which would be hard since I’m cash heavy), I lose my house, and my job (which is unlikely), I am still OK–but thanks for the concern.
Also, I never have and still do not wish ruination upon others. I also do not expect this real estate meltdown to ruin hordes of people, at least not anymore than did the S&L bust or Tech bubble.
BTW: Unemployment has been sub double digit since WWII, ignoring some imperfections in the number, that means 90% or more people have had jobs for almost 70 years. I doubt many of you old timers were alive, never mind working before then. http://www.bls.gov/cps/cpsaat1.pdf

Perhaps you are worried about a depression rather than a recession?

Truly hoping you all stay solvent,
-one muggle

[LA_Renter]

fat_lazy_union,

There is another aspect of this to consider, in my case I know I am vulnerable to an economic downturn. That’s why I decided to sit out the current housing market. My rationale was if I make a home purchase now (2005-present) and this turns out to be a hard landing / debacle, then I or my spouse could find ourselves in a mortgage (where we have to stretch ourselves to the max) facing a layoff and not able to sell our home without a substantial loss in equity. What really puts my mind at rest from a financial perspective is the rent verses own equation favors renters, in my case at least 1500/mo after tax premium. I think the over riding motive for many people is self preservation. Am I looking forward to the increased stress and anxiety of an economic downturn…..No! Do I want this to be over with….Yes. If I or my spouse lose our job in that event then we did the right thing and preserved our capital and have the flexibility to move. If we weather the storm then we will find ourselves with a small group of people that have great credit alot of cash and many properties to chose from. I’m hoping for the latter!!

[LA_Renter]

fat_lazy_union,

There is another aspect of this to consider, in my case I know I am vulnerable to an economic downturn. That’s why I decided to sit out the current housing market. My rationale was if I make a home purchase now (2005-present) and this turns out to be a hard landing / debacle, then I or my spouse could find ourselves in a mortgage (where we have to stretch ourselves to the max) facing a layoff and not able to sell our home without a substantial loss in equity. What really puts my mind at rest from a financial perspective is the rent verses own equation favors renters, in my case at least 1500/mo after tax premium. I think the over riding motive for many people is self preservation. Am I looking forward to the increased stress and anxiety of an economic downturn…..No! Do I want this to be over with….Yes. If I or my spouse lose our job in that event then we did the right thing and preserved our capital and have the flexibility to move. If we weather the storm then we will find ourselves with a small group of people that have great credit alot of cash and many properties to chose from. I’m hoping for the latter!!

[LA_Renter]

fat_lazy_union,

There is another aspect of this to consider, in my case I know I am vulnerable to an economic downturn. That’s why I decided to sit out the current housing market. My rationale was if I make a home purchase now (2005-present) and this turns out to be a hard landing / debacle, then I or my spouse could find ourselves in a mortgage (where we have to stretch ourselves to the max) facing a layoff and not able to sell our home without a substantial loss in equity. What really puts my mind at rest from a financial perspective is the rent verses own equation favors renters, in my case at least 1500/mo after tax premium. I think the over riding motive for many people is self preservation. Am I looking forward to the increased stress and anxiety of an economic downturn…..No! Do I want this to be over with….Yes. If I or my spouse lose our job in that event then we did the right thing and preserved our capital and have the flexibility to move. If we weather the storm then we will find ourselves with a small group of people that have great credit alot of cash and many properties to chose from. I’m hoping for the latter!!

[Author]

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