[barnaby33]

Even though it didn’t make the list, my favorite is, “Life is good in Amarillo.” I put a post there once in a while just to get a chuckle and bring it back for comparison.

gosh darn it, Amarillo is HOT! (Not the RE of course.)

Josh

[barnaby33]

Even though it didn’t make the list, my favorite is, “Life is good in Amarillo.” I put a post there once in a while just to get a chuckle and bring it back for comparison.

gosh darn it, Amarillo is HOT! (Not the RE of course.)

Josh

[barnaby33]

Even though it didn’t make the list, my favorite is, “Life is good in Amarillo.” I put a post there once in a while just to get a chuckle and bring it back for comparison.

gosh darn it, Amarillo is HOT! (Not the RE of course.)

Josh

[barnaby33]

JWM, the inflation vs deflation argument is one we have over and over again, and will keep doing so. In my talk with Rich last week, he stuck to his guns on inflation and he had some good reasons for it.

I am still leaning towards deflation and have good reasons as well. Simply, “pushing on a string,” is not a realistic analogy. While its true that the FED cannot force banks to lend, which is the crux of the deflationary scenario, the FED has more tools that it has brought to bare. For one thing it could bypass the major banks and offer money at extremely low rates to EVERYONE. It could hand out Visa cards with 2000 dollar limits (which happened already to Katrina victims.)

Another interesting thing about the inflation vs deflation argument is where the money goes when its lent. If foreigners mostly invest in Tbills, then a sharp pullback in lending from them will hurt the govt directly and asset prices only indirectly. Whats the FED response to that? Drop rates like a rock and hope they can stimulate demand internally? Raise rates and hope to woo foreigners back? Thats based on the assumption that foreigners, meaning central banks, do mostly buy Tbills.

On the other hand MEW, seems to go more into consumption and financial assets like stocks. The cut-off of that is what makes me far more inclined to believe the deflation scenario. As you pointed out the confidence crisis or, “who’s hiding the sausage,” will chill lending. In this case the fed will have two choices, keep pretending or get congress to bail out the insolvent banks. I have no faith that they will be honest in the face of deflation.

At that point the FED would have to admit that we have a sh*tty asset crisis and let the markets work through them. I just don’t see that happening. So we come back to the original inflation deflation dilemma. Do you believe the FED has the ability to keep people borrowing? If so, you believe the inflation scenario, otherwise deflation should be your choice.

Josh

[barnaby33]

JWM, the inflation vs deflation argument is one we have over and over again, and will keep doing so. In my talk with Rich last week, he stuck to his guns on inflation and he had some good reasons for it.

I am still leaning towards deflation and have good reasons as well. Simply, “pushing on a string,” is not a realistic analogy. While its true that the FED cannot force banks to lend, which is the crux of the deflationary scenario, the FED has more tools that it has brought to bare. For one thing it could bypass the major banks and offer money at extremely low rates to EVERYONE. It could hand out Visa cards with 2000 dollar limits (which happened already to Katrina victims.)

Another interesting thing about the inflation vs deflation argument is where the money goes when its lent. If foreigners mostly invest in Tbills, then a sharp pullback in lending from them will hurt the govt directly and asset prices only indirectly. Whats the FED response to that? Drop rates like a rock and hope they can stimulate demand internally? Raise rates and hope to woo foreigners back? Thats based on the assumption that foreigners, meaning central banks, do mostly buy Tbills.

On the other hand MEW, seems to go more into consumption and financial assets like stocks. The cut-off of that is what makes me far more inclined to believe the deflation scenario. As you pointed out the confidence crisis or, “who’s hiding the sausage,” will chill lending. In this case the fed will have two choices, keep pretending or get congress to bail out the insolvent banks. I have no faith that they will be honest in the face of deflation.

At that point the FED would have to admit that we have a sh*tty asset crisis and let the markets work through them. I just don’t see that happening. So we come back to the original inflation deflation dilemma. Do you believe the FED has the ability to keep people borrowing? If so, you believe the inflation scenario, otherwise deflation should be your choice.

Josh

[barnaby33]

JWM, the inflation vs deflation argument is one we have over and over again, and will keep doing so. In my talk with Rich last week, he stuck to his guns on inflation and he had some good reasons for it.

I am still leaning towards deflation and have good reasons as well. Simply, “pushing on a string,” is not a realistic analogy. While its true that the FED cannot force banks to lend, which is the crux of the deflationary scenario, the FED has more tools that it has brought to bare. For one thing it could bypass the major banks and offer money at extremely low rates to EVERYONE. It could hand out Visa cards with 2000 dollar limits (which happened already to Katrina victims.)

Another interesting thing about the inflation vs deflation argument is where the money goes when its lent. If foreigners mostly invest in Tbills, then a sharp pullback in lending from them will hurt the govt directly and asset prices only indirectly. Whats the FED response to that? Drop rates like a rock and hope they can stimulate demand internally? Raise rates and hope to woo foreigners back? Thats based on the assumption that foreigners, meaning central banks, do mostly buy Tbills.

On the other hand MEW, seems to go more into consumption and financial assets like stocks. The cut-off of that is what makes me far more inclined to believe the deflation scenario. As you pointed out the confidence crisis or, “who’s hiding the sausage,” will chill lending. In this case the fed will have two choices, keep pretending or get congress to bail out the insolvent banks. I have no faith that they will be honest in the face of deflation.

At that point the FED would have to admit that we have a sh*tty asset crisis and let the markets work through them. I just don’t see that happening. So we come back to the original inflation deflation dilemma. Do you believe the FED has the ability to keep people borrowing? If so, you believe the inflation scenario, otherwise deflation should be your choice.

Josh

[barnaby33]

JWM, the inflation vs deflation argument is one we have over and over again, and will keep doing so. In my talk with Rich last week, he stuck to his guns on inflation and he had some good reasons for it.

I am still leaning towards deflation and have good reasons as well. Simply, “pushing on a string,” is not a realistic analogy. While its true that the FED cannot force banks to lend, which is the crux of the deflationary scenario, the FED has more tools that it has brought to bare. For one thing it could bypass the major banks and offer money at extremely low rates to EVERYONE. It could hand out Visa cards with 2000 dollar limits (which happened already to Katrina victims.)

Another interesting thing about the inflation vs deflation argument is where the money goes when its lent. If foreigners mostly invest in Tbills, then a sharp pullback in lending from them will hurt the govt directly and asset prices only indirectly. Whats the FED response to that? Drop rates like a rock and hope they can stimulate demand internally? Raise rates and hope to woo foreigners back? Thats based on the assumption that foreigners, meaning central banks, do mostly buy Tbills.

On the other hand MEW, seems to go more into consumption and financial assets like stocks. The cut-off of that is what makes me far more inclined to believe the deflation scenario. As you pointed out the confidence crisis or, “who’s hiding the sausage,” will chill lending. In this case the fed will have two choices, keep pretending or get congress to bail out the insolvent banks. I have no faith that they will be honest in the face of deflation.

At that point the FED would have to admit that we have a sh*tty asset crisis and let the markets work through them. I just don’t see that happening. So we come back to the original inflation deflation dilemma. Do you believe the FED has the ability to keep people borrowing? If so, you believe the inflation scenario, otherwise deflation should be your choice.

Josh

[barnaby33]

JWM, the inflation vs deflation argument is one we have over and over again, and will keep doing so. In my talk with Rich last week, he stuck to his guns on inflation and he had some good reasons for it.

I am still leaning towards deflation and have good reasons as well. Simply, “pushing on a string,” is not a realistic analogy. While its true that the FED cannot force banks to lend, which is the crux of the deflationary scenario, the FED has more tools that it has brought to bare. For one thing it could bypass the major banks and offer money at extremely low rates to EVERYONE. It could hand out Visa cards with 2000 dollar limits (which happened already to Katrina victims.)

Another interesting thing about the inflation vs deflation argument is where the money goes when its lent. If foreigners mostly invest in Tbills, then a sharp pullback in lending from them will hurt the govt directly and asset prices only indirectly. Whats the FED response to that? Drop rates like a rock and hope they can stimulate demand internally? Raise rates and hope to woo foreigners back? Thats based on the assumption that foreigners, meaning central banks, do mostly buy Tbills.

On the other hand MEW, seems to go more into consumption and financial assets like stocks. The cut-off of that is what makes me far more inclined to believe the deflation scenario. As you pointed out the confidence crisis or, “who’s hiding the sausage,” will chill lending. In this case the fed will have two choices, keep pretending or get congress to bail out the insolvent banks. I have no faith that they will be honest in the face of deflation.

At that point the FED would have to admit that we have a sh*tty asset crisis and let the markets work through them. I just don’t see that happening. So we come back to the original inflation deflation dilemma. Do you believe the FED has the ability to keep people borrowing? If so, you believe the inflation scenario, otherwise deflation should be your choice.

Josh

[barnaby33]

“8xGRM”….you are kidding right? Hardly, there are plenty of places where you can buy things in a decent area for this, especially once house prices deflate to a more realistic level. It all depends on your view of history. If you see as I do that we have lived our entire lives in an inflationary bubble, then 8xGRM is an artifact from a bygone era. If you see deflation in our future, even that might be a bit expensive.

At this point houses are merely highly leveraged gambling devices. If inflation keeps up and you keep your job, you win. If deflation takes hold and you bought in the last 5 years, you’re screwed.

Either way overall housing returns to the same formulas time and again. Maybe Sd won’t return to those types of numbers, I could be totally wrong there, but I certainly don’t think its crazy.

Josh

[barnaby33]

“8xGRM”….you are kidding right? Hardly, there are plenty of places where you can buy things in a decent area for this, especially once house prices deflate to a more realistic level. It all depends on your view of history. If you see as I do that we have lived our entire lives in an inflationary bubble, then 8xGRM is an artifact from a bygone era. If you see deflation in our future, even that might be a bit expensive.

At this point houses are merely highly leveraged gambling devices. If inflation keeps up and you keep your job, you win. If deflation takes hold and you bought in the last 5 years, you’re screwed.

Either way overall housing returns to the same formulas time and again. Maybe Sd won’t return to those types of numbers, I could be totally wrong there, but I certainly don’t think its crazy.

Josh

[barnaby33]

“8xGRM”….you are kidding right? Hardly, there are plenty of places where you can buy things in a decent area for this, especially once house prices deflate to a more realistic level. It all depends on your view of history. If you see as I do that we have lived our entire lives in an inflationary bubble, then 8xGRM is an artifact from a bygone era. If you see deflation in our future, even that might be a bit expensive.

At this point houses are merely highly leveraged gambling devices. If inflation keeps up and you keep your job, you win. If deflation takes hold and you bought in the last 5 years, you’re screwed.

Either way overall housing returns to the same formulas time and again. Maybe Sd won’t return to those types of numbers, I could be totally wrong there, but I certainly don’t think its crazy.

Josh

[barnaby33]

“8xGRM”….you are kidding right? Hardly, there are plenty of places where you can buy things in a decent area for this, especially once house prices deflate to a more realistic level. It all depends on your view of history. If you see as I do that we have lived our entire lives in an inflationary bubble, then 8xGRM is an artifact from a bygone era. If you see deflation in our future, even that might be a bit expensive.

At this point houses are merely highly leveraged gambling devices. If inflation keeps up and you keep your job, you win. If deflation takes hold and you bought in the last 5 years, you’re screwed.

Either way overall housing returns to the same formulas time and again. Maybe Sd won’t return to those types of numbers, I could be totally wrong there, but I certainly don’t think its crazy.

Josh

[barnaby33]

“8xGRM”….you are kidding right? Hardly, there are plenty of places where you can buy things in a decent area for this, especially once house prices deflate to a more realistic level. It all depends on your view of history. If you see as I do that we have lived our entire lives in an inflationary bubble, then 8xGRM is an artifact from a bygone era. If you see deflation in our future, even that might be a bit expensive.

At this point houses are merely highly leveraged gambling devices. If inflation keeps up and you keep your job, you win. If deflation takes hold and you bought in the last 5 years, you’re screwed.

Either way overall housing returns to the same formulas time and again. Maybe Sd won’t return to those types of numbers, I could be totally wrong there, but I certainly don’t think its crazy.

Josh

[barnaby33]

SD Realtor, I stand guilty as charged and playing the law of averages. Mira Mesa isn’t my favorite place, but since I’ve worked there and lived around it, I know it reasonably well. It is NOT a ghetto, but it is solidly lower middle and middle income housing. Parts on the north and western sides are ok, the middle is mostly aging housing stock with large densely packed populations.

Now there is a reason why people pay more to live someplaces than others in San Diego. Is it the weather, partly. Is it the conveniences and architectures, yep partly that too. What most people really want to pay for though is a, “good neighborhood.” What that means doesn’t vary all that much, to the protestation of many. It generally means low density, well educated, higher income and good schools. I’m sure you can find plenty of people to say Mira Mesa is great, but I’d bet my last dollar that very few who make 80k and have a large pool of money to buy with would consider it a first, second or even third choice.

The sheer ludicrous-iosity of the statement helped to highlight how off the rails we got. I just latched on to that statement as a poster child if you will of how badly we have lost our bearings; how we had become so numb to the vast sums of money being spent, even wasted, to secure ourselves a home.

Sometimes my posts are hastily written, but not that one. I live in Northpark which in many ways is just like Mira Mesa. Its older housing, meant for lower middle income earners. Its near jobs and services, yet it is lacking in many ways. In short its a decent place to live, but not great. At what point though have you worked hard enough that you are entitled to more? At what point do you say, f#$%k that, I’ve worked to hard to settle for a 1971 tear down behind Fudruckers. I don’t want 17 neighbor cars parked in front of my house, or alarms going off every night. I’d say at 80k a year and that much for a downpayment certainly justifies that sentiment.

So the correction continues, until balance is restored.

Josh

[barnaby33]

SD Realtor, I stand guilty as charged and playing the law of averages. Mira Mesa isn’t my favorite place, but since I’ve worked there and lived around it, I know it reasonably well. It is NOT a ghetto, but it is solidly lower middle and middle income housing. Parts on the north and western sides are ok, the middle is mostly aging housing stock with large densely packed populations.

Now there is a reason why people pay more to live someplaces than others in San Diego. Is it the weather, partly. Is it the conveniences and architectures, yep partly that too. What most people really want to pay for though is a, “good neighborhood.” What that means doesn’t vary all that much, to the protestation of many. It generally means low density, well educated, higher income and good schools. I’m sure you can find plenty of people to say Mira Mesa is great, but I’d bet my last dollar that very few who make 80k and have a large pool of money to buy with would consider it a first, second or even third choice.

The sheer ludicrous-iosity of the statement helped to highlight how off the rails we got. I just latched on to that statement as a poster child if you will of how badly we have lost our bearings; how we had become so numb to the vast sums of money being spent, even wasted, to secure ourselves a home.

Sometimes my posts are hastily written, but not that one. I live in Northpark which in many ways is just like Mira Mesa. Its older housing, meant for lower middle income earners. Its near jobs and services, yet it is lacking in many ways. In short its a decent place to live, but not great. At what point though have you worked hard enough that you are entitled to more? At what point do you say, f#$%k that, I’ve worked to hard to settle for a 1971 tear down behind Fudruckers. I don’t want 17 neighbor cars parked in front of my house, or alarms going off every night. I’d say at 80k a year and that much for a downpayment certainly justifies that sentiment.

So the correction continues, until balance is restored.

Josh

[Author]

Posts