The Ongoing Case-Shiller Fallacy/Shadow Inventory

[SD Realtor]

I would not say it is a great time to buy either. I would like to see a posting where any of the regular realtors who post here say that.

Please point me to that post.

Also as a fact to consider, of the shadow inventory there are MLS listings that were sold that were distressed properties purchased by investors that would also reduce your shadow inventory count but now show up as a MLS distressed sale…

I guess reporting what we see which is strong sales activity is misconstrued by some as a “now is time to buy” mantra.

I do not understand why that is.

[Rt.66]

[quote=sdrealtor]ROTFLMAO..Did he actually say numbers dont lie? What a moron. Of course they do, they say whatever you want them to. Back in my CPA days we had a joke. Client walks into his CPA’s office and says what does 1+1 equal? CPA goes over to the window and pulls the shade down before asking “what do you want to equal?”

Lets assume your numbers are accurate (which I know they arent but who gives a damn). There are over 4,000 MLS listings in contingent status (i.e. short sales most likely in those numbers you are quoting). There are 6700 MLS listings in pending status (conservatively 1/3rd of them are short sales). Thats about 6500 properties you are claiming as shadow inventory that are currently being digested by this raging market at full retail prices. There goes more than half of your shadow inventory. Its not hiding anywhere. Its sitting on the MLS under contract with piles of back up offers. That doesnt even consider all the loan mods in process.

Read my post above. It was said by one of the top Bear analysts on Wall St. He understands that the bear case will always appear stronger because it is based on rational current data. He is also smart of to understand that isnt always correct.

I dont want this to end as I am making a killing off it. If the market goes down for at least 2 more years like it has, my business will flourish. If it turns around my business will suffer dearly. I hope you (Rt 66) are right and it struggles for another 5 to 10 years but know and see enough to understand that is unlikely to be true.

Lets be clear on one thing. We are not saying its a great time to buy. What we are saying is “You are a moron!”[/quote]

“We are not saying its a great time to buy. What we are saying is “You are a moron!”

We? We who? You got a mouse in your pocket?

RealtyTrac has great feature called “Listed” that cross references its foreclosure listings with the MLS. Distressed properties that are for sale are listed as such and those that are sold are listed as such.

Of the 4953 Preforclosures I found just a very few for sale as short sales. Of course none of the 3722 in auction status are short sales. As for the Bank Owned homes more are listed in that category as being for sale (of course) or sold but it’s mostly the really old ones and it’s still a small percentage of the 4046 total.

So, again the figures and data show that your wild ass guess is not accurate and your theory full of holes.

It does not take the mysteries of a highly trained realtor’s knowledge (TIC) to find these things, anyone can browse through RTrac free and see what I am saying.

Since you are so fond of speculating and pulling numbers out of your butt allow me (the moron) to speculate (although with some common sense involved).

Those 4000 contingent status that you speculate are mostly short sales, are likely homes that the owners contacted the banks and notified they were no longer going to or were able to perform and requested a short sale. Most probably never had a NOD filled and therefore are invisible to foreclosure data but are part of the shadow inventory problem.

The last short sale I bid on was not listed in any foreclosure stats until the bank decided against the idea of a short sale and filled the NOD two months later. In short, a majority of your speculative bunghole numbers would more rationally be ADDED to the horrid foreclosure data figures, not subtracted from.

I can’t prove any of that but if you are going to argue with speculation then I guess I’ll fight speculation with rational speculation?

[Rt.66]

[quote=sdrealtor]ROTFLMAO..Did he actually say numbers dont lie? What a moron. Of course they do, they say whatever you want them to. Back in my CPA days we had a joke. Client walks into his CPA’s office and says what does 1+1 equal? CPA goes over to the window and pulls the shade down before asking “what do you want to equal?”

Lets assume your numbers are accurate (which I know they arent but who gives a damn). There are over 4,000 MLS listings in contingent status (i.e. short sales most likely in those numbers you are quoting). There are 6700 MLS listings in pending status (conservatively 1/3rd of them are short sales). Thats about 6500 properties you are claiming as shadow inventory that are currently being digested by this raging market at full retail prices. There goes more than half of your shadow inventory. Its not hiding anywhere. Its sitting on the MLS under contract with piles of back up offers. That doesnt even consider all the loan mods in process.

Read my post above. It was said by one of the top Bear analysts on Wall St. He understands that the bear case will always appear stronger because it is based on rational current data. He is also smart of to understand that isnt always correct.

I dont want this to end as I am making a killing off it. If the market goes down for at least 2 more years like it has, my business will flourish. If it turns around my business will suffer dearly. I hope you (Rt 66) are right and it struggles for another 5 to 10 years but know and see enough to understand that is unlikely to be true.

Lets be clear on one thing. We are not saying its a great time to buy. What we are saying is “You are a moron!”[/quote]

“We are not saying its a great time to buy. What we are saying is “You are a moron!”

We? We who? You got a mouse in your pocket?

RealtyTrac has great feature called “Listed” that cross references its foreclosure listings with the MLS. Distressed properties that are for sale are listed as such and those that are sold are listed as such.

Of the 4953 Preforclosures I found just a very few for sale as short sales. Of course none of the 3722 in auction status are short sales. As for the Bank Owned homes more are listed in that category as being for sale (of course) or sold but it’s mostly the really old ones and it’s still a small percentage of the 4046 total.

So, again the figures and data show that your wild ass guess is not accurate and your theory full of holes.

It does not take the mysteries of a highly trained realtor’s knowledge (TIC) to find these things, anyone can browse through RTrac free and see what I am saying.

Since you are so fond of speculating and pulling numbers out of your butt allow me (the moron) to speculate (although with some common sense involved).

Those 4000 contingent status that you speculate are mostly short sales, are likely homes that the owners contacted the banks and notified they were no longer going to or were able to perform and requested a short sale. Most probably never had a NOD filled and therefore are invisible to foreclosure data but are part of the shadow inventory problem.

The last short sale I bid on was not listed in any foreclosure stats until the bank decided against the idea of a short sale and filled the NOD two months later. In short, a majority of your speculative bunghole numbers would more rationally be ADDED to the horrid foreclosure data figures, not subtracted from.

I can’t prove any of that but if you are going to argue with speculation then I guess I’ll fight speculation with rational speculation?

[Rt.66]

[quote=sdrealtor]ROTFLMAO..Did he actually say numbers dont lie? What a moron. Of course they do, they say whatever you want them to. Back in my CPA days we had a joke. Client walks into his CPA’s office and says what does 1+1 equal? CPA goes over to the window and pulls the shade down before asking “what do you want to equal?”

Lets assume your numbers are accurate (which I know they arent but who gives a damn). There are over 4,000 MLS listings in contingent status (i.e. short sales most likely in those numbers you are quoting). There are 6700 MLS listings in pending status (conservatively 1/3rd of them are short sales). Thats about 6500 properties you are claiming as shadow inventory that are currently being digested by this raging market at full retail prices. There goes more than half of your shadow inventory. Its not hiding anywhere. Its sitting on the MLS under contract with piles of back up offers. That doesnt even consider all the loan mods in process.

Read my post above. It was said by one of the top Bear analysts on Wall St. He understands that the bear case will always appear stronger because it is based on rational current data. He is also smart of to understand that isnt always correct.

I dont want this to end as I am making a killing off it. If the market goes down for at least 2 more years like it has, my business will flourish. If it turns around my business will suffer dearly. I hope you (Rt 66) are right and it struggles for another 5 to 10 years but know and see enough to understand that is unlikely to be true.

Lets be clear on one thing. We are not saying its a great time to buy. What we are saying is “You are a moron!”[/quote]

“We are not saying its a great time to buy. What we are saying is “You are a moron!”

We? We who? You got a mouse in your pocket?

RealtyTrac has great feature called “Listed” that cross references its foreclosure listings with the MLS. Distressed properties that are for sale are listed as such and those that are sold are listed as such.

Of the 4953 Preforclosures I found just a very few for sale as short sales. Of course none of the 3722 in auction status are short sales. As for the Bank Owned homes more are listed in that category as being for sale (of course) or sold but it’s mostly the really old ones and it’s still a small percentage of the 4046 total.

So, again the figures and data show that your wild ass guess is not accurate and your theory full of holes.

It does not take the mysteries of a highly trained realtor’s knowledge (TIC) to find these things, anyone can browse through RTrac free and see what I am saying.

Since you are so fond of speculating and pulling numbers out of your butt allow me (the moron) to speculate (although with some common sense involved).

Those 4000 contingent status that you speculate are mostly short sales, are likely homes that the owners contacted the banks and notified they were no longer going to or were able to perform and requested a short sale. Most probably never had a NOD filled and therefore are invisible to foreclosure data but are part of the shadow inventory problem.

The last short sale I bid on was not listed in any foreclosure stats until the bank decided against the idea of a short sale and filled the NOD two months later. In short, a majority of your speculative bunghole numbers would more rationally be ADDED to the horrid foreclosure data figures, not subtracted from.

I can’t prove any of that but if you are going to argue with speculation then I guess I’ll fight speculation with rational speculation?

[Rt.66]

[quote=sdrealtor]ROTFLMAO..Did he actually say numbers dont lie? What a moron. Of course they do, they say whatever you want them to. Back in my CPA days we had a joke. Client walks into his CPA’s office and says what does 1+1 equal? CPA goes over to the window and pulls the shade down before asking “what do you want to equal?”

Lets assume your numbers are accurate (which I know they arent but who gives a damn). There are over 4,000 MLS listings in contingent status (i.e. short sales most likely in those numbers you are quoting). There are 6700 MLS listings in pending status (conservatively 1/3rd of them are short sales). Thats about 6500 properties you are claiming as shadow inventory that are currently being digested by this raging market at full retail prices. There goes more than half of your shadow inventory. Its not hiding anywhere. Its sitting on the MLS under contract with piles of back up offers. That doesnt even consider all the loan mods in process.

Read my post above. It was said by one of the top Bear analysts on Wall St. He understands that the bear case will always appear stronger because it is based on rational current data. He is also smart of to understand that isnt always correct.

I dont want this to end as I am making a killing off it. If the market goes down for at least 2 more years like it has, my business will flourish. If it turns around my business will suffer dearly. I hope you (Rt 66) are right and it struggles for another 5 to 10 years but know and see enough to understand that is unlikely to be true.

Lets be clear on one thing. We are not saying its a great time to buy. What we are saying is “You are a moron!”[/quote]

“We are not saying its a great time to buy. What we are saying is “You are a moron!”

We? We who? You got a mouse in your pocket?

RealtyTrac has great feature called “Listed” that cross references its foreclosure listings with the MLS. Distressed properties that are for sale are listed as such and those that are sold are listed as such.

Of the 4953 Preforclosures I found just a very few for sale as short sales. Of course none of the 3722 in auction status are short sales. As for the Bank Owned homes more are listed in that category as being for sale (of course) or sold but it’s mostly the really old ones and it’s still a small percentage of the 4046 total.

So, again the figures and data show that your wild ass guess is not accurate and your theory full of holes.

It does not take the mysteries of a highly trained realtor’s knowledge (TIC) to find these things, anyone can browse through RTrac free and see what I am saying.

Since you are so fond of speculating and pulling numbers out of your butt allow me (the moron) to speculate (although with some common sense involved).

Those 4000 contingent status that you speculate are mostly short sales, are likely homes that the owners contacted the banks and notified they were no longer going to or were able to perform and requested a short sale. Most probably never had a NOD filled and therefore are invisible to foreclosure data but are part of the shadow inventory problem.

The last short sale I bid on was not listed in any foreclosure stats until the bank decided against the idea of a short sale and filled the NOD two months later. In short, a majority of your speculative bunghole numbers would more rationally be ADDED to the horrid foreclosure data figures, not subtracted from.

I can’t prove any of that but if you are going to argue with speculation then I guess I’ll fight speculation with rational speculation?

[Rt.66]

[quote=sdrealtor]ROTFLMAO..Did he actually say numbers dont lie? What a moron. Of course they do, they say whatever you want them to. Back in my CPA days we had a joke. Client walks into his CPA’s office and says what does 1+1 equal? CPA goes over to the window and pulls the shade down before asking “what do you want to equal?”

Lets assume your numbers are accurate (which I know they arent but who gives a damn). There are over 4,000 MLS listings in contingent status (i.e. short sales most likely in those numbers you are quoting). There are 6700 MLS listings in pending status (conservatively 1/3rd of them are short sales). Thats about 6500 properties you are claiming as shadow inventory that are currently being digested by this raging market at full retail prices. There goes more than half of your shadow inventory. Its not hiding anywhere. Its sitting on the MLS under contract with piles of back up offers. That doesnt even consider all the loan mods in process.

Read my post above. It was said by one of the top Bear analysts on Wall St. He understands that the bear case will always appear stronger because it is based on rational current data. He is also smart of to understand that isnt always correct.

I dont want this to end as I am making a killing off it. If the market goes down for at least 2 more years like it has, my business will flourish. If it turns around my business will suffer dearly. I hope you (Rt 66) are right and it struggles for another 5 to 10 years but know and see enough to understand that is unlikely to be true.

Lets be clear on one thing. We are not saying its a great time to buy. What we are saying is “You are a moron!”[/quote]

“We are not saying its a great time to buy. What we are saying is “You are a moron!”

We? We who? You got a mouse in your pocket?

RealtyTrac has great feature called “Listed” that cross references its foreclosure listings with the MLS. Distressed properties that are for sale are listed as such and those that are sold are listed as such.

Of the 4953 Preforclosures I found just a very few for sale as short sales. Of course none of the 3722 in auction status are short sales. As for the Bank Owned homes more are listed in that category as being for sale (of course) or sold but it’s mostly the really old ones and it’s still a small percentage of the 4046 total.

So, again the figures and data show that your wild ass guess is not accurate and your theory full of holes.

It does not take the mysteries of a highly trained realtor’s knowledge (TIC) to find these things, anyone can browse through RTrac free and see what I am saying.

Since you are so fond of speculating and pulling numbers out of your butt allow me (the moron) to speculate (although with some common sense involved).

Those 4000 contingent status that you speculate are mostly short sales, are likely homes that the owners contacted the banks and notified they were no longer going to or were able to perform and requested a short sale. Most probably never had a NOD filled and therefore are invisible to foreclosure data but are part of the shadow inventory problem.

The last short sale I bid on was not listed in any foreclosure stats until the bank decided against the idea of a short sale and filled the NOD two months later. In short, a majority of your speculative bunghole numbers would more rationally be ADDED to the horrid foreclosure data figures, not subtracted from.

I can’t prove any of that but if you are going to argue with speculation then I guess I’ll fight speculation with rational speculation?

[Rich Toscano]

[quote=sdrealtor]A couple weeks ago I saw an analyst on CNBC that really resonated with me. He was talking about the pyschology of bears vs bulls and the cases they bring. He pointed out that the bears bring rational facts based upon what is actually going on right now. On the otherhand the bulls case is irrational and based upon a better tomorrow regardless of what the facts are today. BY definition the bulls hypothesis requires a change for the better in the future.

His point is that at face value the bears will always have what seems to be the stronger argument. In every case the bears will be more rational, more fact based and better substantiated. In spite of that, they obviously arent always right because things change and things can get better.

I had never looked at it that way before and it really struck as something often overlooked but so obvious.[/quote]

I actually don’t agree with this at all. It might seem like the bears always have the better argument because for so long, markets defied gravity. But now that gravity has come back into play it’s clear to me that a lot of bears are just as prone to confirmation bias as the permabulls we always mocked.

SD housing was unbelievably overpriced compared to rents. In that case, in my opinion the burden of proof fell on the bulls and as we all know, they never came through because there was no good explanation except that it was a bubble. The bears could just sit back and languidly swat away the bulls’ lame arguments with their bear paws.

Now, SD housing is reasonably priced in comparison to rents (in many areas anyway). It’s a different situation. But to my surprise, it seems like more people are “certain” that there will be another huge crash than there were at the top. This makes no sense. Given the amount that prices have fallen, the burden of proof is now upon people who think that housing will make another big crash leg down.

There is some evidence to that effect, most notably shadow inventory and the potential for a huge rate rise. But the latter (while i think it’s very probable) is super hard to predict in terms of timing. And the former, as this and a million other threads shows, is really tough to get a handle on as far as what’s happening.

Meanwhile, the government has declard all out war on the housing crash and is creating insane amounts of money and credit to pump directly into the market.

So there are arguments in either direction. And the burden of proof now falls on both camps.

Getting back to my original point, I see a lot of confirmation bias and invalid arguments coming from a lot of bears. Not all — some bears have maintained analytical rigor, but imho a lot have not. IOW, I’m seeing as many bad arguments coming from the bearish camp as I am seeing from the bullish camp — although I am also seeing great arguments coming from certain members of both camps.

So, I do not agree that the bears get a pass for always being more right in terms of analysis and evidence, because that is simply not the case.

Nor do I believe that the bulls should get to cling to some fairy tale that it’s correct to ignore evidence because it sometimes worked in the past (which is how I read that CNBC commenter’s remarks, and is a sentiment I firmly disagree with — it’s better to figure out WHY markets defied gravity when they did, not just assume that’s a permanent state of affairs.)

A really good analyst will be able to make the turn from bear to bull and back again when it makes sense to do so (and will also know when to be neither). Of course, everyone is wrong at times, but a good analyst will at least TRY to make that turn, rather than simply being a permanent bear or bull.

Rich

[Rich Toscano]

[quote=sdrealtor]A couple weeks ago I saw an analyst on CNBC that really resonated with me. He was talking about the pyschology of bears vs bulls and the cases they bring. He pointed out that the bears bring rational facts based upon what is actually going on right now. On the otherhand the bulls case is irrational and based upon a better tomorrow regardless of what the facts are today. BY definition the bulls hypothesis requires a change for the better in the future.

His point is that at face value the bears will always have what seems to be the stronger argument. In every case the bears will be more rational, more fact based and better substantiated. In spite of that, they obviously arent always right because things change and things can get better.

I had never looked at it that way before and it really struck as something often overlooked but so obvious.[/quote]

I actually don’t agree with this at all. It might seem like the bears always have the better argument because for so long, markets defied gravity. But now that gravity has come back into play it’s clear to me that a lot of bears are just as prone to confirmation bias as the permabulls we always mocked.

SD housing was unbelievably overpriced compared to rents. In that case, in my opinion the burden of proof fell on the bulls and as we all know, they never came through because there was no good explanation except that it was a bubble. The bears could just sit back and languidly swat away the bulls’ lame arguments with their bear paws.

Now, SD housing is reasonably priced in comparison to rents (in many areas anyway). It’s a different situation. But to my surprise, it seems like more people are “certain” that there will be another huge crash than there were at the top. This makes no sense. Given the amount that prices have fallen, the burden of proof is now upon people who think that housing will make another big crash leg down.

There is some evidence to that effect, most notably shadow inventory and the potential for a huge rate rise. But the latter (while i think it’s very probable) is super hard to predict in terms of timing. And the former, as this and a million other threads shows, is really tough to get a handle on as far as what’s happening.

Meanwhile, the government has declard all out war on the housing crash and is creating insane amounts of money and credit to pump directly into the market.

So there are arguments in either direction. And the burden of proof now falls on both camps.

Getting back to my original point, I see a lot of confirmation bias and invalid arguments coming from a lot of bears. Not all — some bears have maintained analytical rigor, but imho a lot have not. IOW, I’m seeing as many bad arguments coming from the bearish camp as I am seeing from the bullish camp — although I am also seeing great arguments coming from certain members of both camps.

So, I do not agree that the bears get a pass for always being more right in terms of analysis and evidence, because that is simply not the case.

Nor do I believe that the bulls should get to cling to some fairy tale that it’s correct to ignore evidence because it sometimes worked in the past (which is how I read that CNBC commenter’s remarks, and is a sentiment I firmly disagree with — it’s better to figure out WHY markets defied gravity when they did, not just assume that’s a permanent state of affairs.)

A really good analyst will be able to make the turn from bear to bull and back again when it makes sense to do so (and will also know when to be neither). Of course, everyone is wrong at times, but a good analyst will at least TRY to make that turn, rather than simply being a permanent bear or bull.

Rich

[Rich Toscano]

[quote=sdrealtor]A couple weeks ago I saw an analyst on CNBC that really resonated with me. He was talking about the pyschology of bears vs bulls and the cases they bring. He pointed out that the bears bring rational facts based upon what is actually going on right now. On the otherhand the bulls case is irrational and based upon a better tomorrow regardless of what the facts are today. BY definition the bulls hypothesis requires a change for the better in the future.

His point is that at face value the bears will always have what seems to be the stronger argument. In every case the bears will be more rational, more fact based and better substantiated. In spite of that, they obviously arent always right because things change and things can get better.

I had never looked at it that way before and it really struck as something often overlooked but so obvious.[/quote]

I actually don’t agree with this at all. It might seem like the bears always have the better argument because for so long, markets defied gravity. But now that gravity has come back into play it’s clear to me that a lot of bears are just as prone to confirmation bias as the permabulls we always mocked.

SD housing was unbelievably overpriced compared to rents. In that case, in my opinion the burden of proof fell on the bulls and as we all know, they never came through because there was no good explanation except that it was a bubble. The bears could just sit back and languidly swat away the bulls’ lame arguments with their bear paws.

Now, SD housing is reasonably priced in comparison to rents (in many areas anyway). It’s a different situation. But to my surprise, it seems like more people are “certain” that there will be another huge crash than there were at the top. This makes no sense. Given the amount that prices have fallen, the burden of proof is now upon people who think that housing will make another big crash leg down.

There is some evidence to that effect, most notably shadow inventory and the potential for a huge rate rise. But the latter (while i think it’s very probable) is super hard to predict in terms of timing. And the former, as this and a million other threads shows, is really tough to get a handle on as far as what’s happening.

Meanwhile, the government has declard all out war on the housing crash and is creating insane amounts of money and credit to pump directly into the market.

So there are arguments in either direction. And the burden of proof now falls on both camps.

Getting back to my original point, I see a lot of confirmation bias and invalid arguments coming from a lot of bears. Not all — some bears have maintained analytical rigor, but imho a lot have not. IOW, I’m seeing as many bad arguments coming from the bearish camp as I am seeing from the bullish camp — although I am also seeing great arguments coming from certain members of both camps.

So, I do not agree that the bears get a pass for always being more right in terms of analysis and evidence, because that is simply not the case.

Nor do I believe that the bulls should get to cling to some fairy tale that it’s correct to ignore evidence because it sometimes worked in the past (which is how I read that CNBC commenter’s remarks, and is a sentiment I firmly disagree with — it’s better to figure out WHY markets defied gravity when they did, not just assume that’s a permanent state of affairs.)

A really good analyst will be able to make the turn from bear to bull and back again when it makes sense to do so (and will also know when to be neither). Of course, everyone is wrong at times, but a good analyst will at least TRY to make that turn, rather than simply being a permanent bear or bull.

Rich

[Rich Toscano]

[quote=sdrealtor]A couple weeks ago I saw an analyst on CNBC that really resonated with me. He was talking about the pyschology of bears vs bulls and the cases they bring. He pointed out that the bears bring rational facts based upon what is actually going on right now. On the otherhand the bulls case is irrational and based upon a better tomorrow regardless of what the facts are today. BY definition the bulls hypothesis requires a change for the better in the future.

His point is that at face value the bears will always have what seems to be the stronger argument. In every case the bears will be more rational, more fact based and better substantiated. In spite of that, they obviously arent always right because things change and things can get better.

I had never looked at it that way before and it really struck as something often overlooked but so obvious.[/quote]

I actually don’t agree with this at all. It might seem like the bears always have the better argument because for so long, markets defied gravity. But now that gravity has come back into play it’s clear to me that a lot of bears are just as prone to confirmation bias as the permabulls we always mocked.

SD housing was unbelievably overpriced compared to rents. In that case, in my opinion the burden of proof fell on the bulls and as we all know, they never came through because there was no good explanation except that it was a bubble. The bears could just sit back and languidly swat away the bulls’ lame arguments with their bear paws.

Now, SD housing is reasonably priced in comparison to rents (in many areas anyway). It’s a different situation. But to my surprise, it seems like more people are “certain” that there will be another huge crash than there were at the top. This makes no sense. Given the amount that prices have fallen, the burden of proof is now upon people who think that housing will make another big crash leg down.

There is some evidence to that effect, most notably shadow inventory and the potential for a huge rate rise. But the latter (while i think it’s very probable) is super hard to predict in terms of timing. And the former, as this and a million other threads shows, is really tough to get a handle on as far as what’s happening.

Meanwhile, the government has declard all out war on the housing crash and is creating insane amounts of money and credit to pump directly into the market.

So there are arguments in either direction. And the burden of proof now falls on both camps.

Getting back to my original point, I see a lot of confirmation bias and invalid arguments coming from a lot of bears. Not all — some bears have maintained analytical rigor, but imho a lot have not. IOW, I’m seeing as many bad arguments coming from the bearish camp as I am seeing from the bullish camp — although I am also seeing great arguments coming from certain members of both camps.

So, I do not agree that the bears get a pass for always being more right in terms of analysis and evidence, because that is simply not the case.

Nor do I believe that the bulls should get to cling to some fairy tale that it’s correct to ignore evidence because it sometimes worked in the past (which is how I read that CNBC commenter’s remarks, and is a sentiment I firmly disagree with — it’s better to figure out WHY markets defied gravity when they did, not just assume that’s a permanent state of affairs.)

A really good analyst will be able to make the turn from bear to bull and back again when it makes sense to do so (and will also know when to be neither). Of course, everyone is wrong at times, but a good analyst will at least TRY to make that turn, rather than simply being a permanent bear or bull.

Rich

[Rich Toscano]

[quote=sdrealtor]A couple weeks ago I saw an analyst on CNBC that really resonated with me. He was talking about the pyschology of bears vs bulls and the cases they bring. He pointed out that the bears bring rational facts based upon what is actually going on right now. On the otherhand the bulls case is irrational and based upon a better tomorrow regardless of what the facts are today. BY definition the bulls hypothesis requires a change for the better in the future.

His point is that at face value the bears will always have what seems to be the stronger argument. In every case the bears will be more rational, more fact based and better substantiated. In spite of that, they obviously arent always right because things change and things can get better.

I had never looked at it that way before and it really struck as something often overlooked but so obvious.[/quote]

I actually don’t agree with this at all. It might seem like the bears always have the better argument because for so long, markets defied gravity. But now that gravity has come back into play it’s clear to me that a lot of bears are just as prone to confirmation bias as the permabulls we always mocked.

SD housing was unbelievably overpriced compared to rents. In that case, in my opinion the burden of proof fell on the bulls and as we all know, they never came through because there was no good explanation except that it was a bubble. The bears could just sit back and languidly swat away the bulls’ lame arguments with their bear paws.

Now, SD housing is reasonably priced in comparison to rents (in many areas anyway). It’s a different situation. But to my surprise, it seems like more people are “certain” that there will be another huge crash than there were at the top. This makes no sense. Given the amount that prices have fallen, the burden of proof is now upon people who think that housing will make another big crash leg down.

There is some evidence to that effect, most notably shadow inventory and the potential for a huge rate rise. But the latter (while i think it’s very probable) is super hard to predict in terms of timing. And the former, as this and a million other threads shows, is really tough to get a handle on as far as what’s happening.

Meanwhile, the government has declard all out war on the housing crash and is creating insane amounts of money and credit to pump directly into the market.

So there are arguments in either direction. And the burden of proof now falls on both camps.

Getting back to my original point, I see a lot of confirmation bias and invalid arguments coming from a lot of bears. Not all — some bears have maintained analytical rigor, but imho a lot have not. IOW, I’m seeing as many bad arguments coming from the bearish camp as I am seeing from the bullish camp — although I am also seeing great arguments coming from certain members of both camps.

So, I do not agree that the bears get a pass for always being more right in terms of analysis and evidence, because that is simply not the case.

Nor do I believe that the bulls should get to cling to some fairy tale that it’s correct to ignore evidence because it sometimes worked in the past (which is how I read that CNBC commenter’s remarks, and is a sentiment I firmly disagree with — it’s better to figure out WHY markets defied gravity when they did, not just assume that’s a permanent state of affairs.)

A really good analyst will be able to make the turn from bear to bull and back again when it makes sense to do so (and will also know when to be neither). Of course, everyone is wrong at times, but a good analyst will at least TRY to make that turn, rather than simply being a permanent bear or bull.

Rich

[scaredyclassic]

i wonder when will be a good time to buya house. is ther eever a good time?

[scaredyclassic]

i wonder when will be a good time to buya house. is ther eever a good time?

[scaredyclassic]

i wonder when will be a good time to buya house. is ther eever a good time?

[scaredyclassic]

i wonder when will be a good time to buya house. is ther eever a good time?

[Author]

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