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HereWeGo
Participantrustico-
It should be clear at this point that foreclosures will accelerate. Many homeowners struggle with payments, and banks are radically increasing the credit spreads (mortgage rates are going up as the 10 year yield falls.)
The Fed needs to think outside the box a bit. They should create a special rate for homeowners to refi, under the expectation that the banks that are currently in deep trouble due to buyback threats will willingly process the refis at a low markup. Perhaps this should be limited to primary residences, I’m not sure. Since such a move would clearly be inflationary, the Fed shoud bump up the FFR at the same time.
This would allow current holders of paper to be paid off (in some measure,) settling the credit markets, and it would greatly slow the foreclosure rate. Housing would still fall, but at a much slower pace. That may not be good for folks that read this board, but it would be good for the overwhelming majority of the country.
If the Fed just sits on its hands, the board members will be much remembered for their fiddling skills IMO.
ParticipantLocation, location, location …
I wouldn’t hold my breath waiting for a 20% loss in the area mentioned by SD Realtor. The “other CV” might take a serious hit, though.
ParticipantLocation, location, location …
I wouldn’t hold my breath waiting for a 20% loss in the area mentioned by SD Realtor. The “other CV” might take a serious hit, though.
ParticipantDon’t discount the powers of the Fed.
ParticipantDon’t discount the powers of the Fed.
Participantanx-
You might want to compare LM vs. MER, LEH, GS, and BSC. It’s a most revealing plot.Participantanx-
You might want to compare LM vs. MER, LEH, GS, and BSC. It’s a most revealing plot.Participanthomebuilders bumped up today. You could always take a shot at the investment banks and brokers as well. They have some serious inertia at this point and a lot of room to fall, maybe buy the puts on an uptick.
There are some nice call opportunities as well … maybe mastercard, it seems more than a little oversold. Who knows, though, but I don’t see consumer credit as the problem at this point.
Participanthomebuilders bumped up today. You could always take a shot at the investment banks and brokers as well. They have some serious inertia at this point and a lot of room to fall, maybe buy the puts on an uptick.
There are some nice call opportunities as well … maybe mastercard, it seems more than a little oversold. Who knows, though, but I don’t see consumer credit as the problem at this point.
ParticipantAn explanation of the events of the past two weeks (heck perhaps the last month):
Don’t know if it’s over just yet … it all depends on how much bad paper is still out there.
ParticipantAn explanation of the events of the past two weeks (heck perhaps the last month):
Don’t know if it’s over just yet … it all depends on how much bad paper is still out there.
ParticipantYeah, “buy and hold” can be a really bad philosophy for the wrong investment.
ParticipantYeah, “buy and hold” can be a really bad philosophy for the wrong investment.
ParticipantMaybe an even bigger question, one that I wish at least one bear would have asked a month ago, is what effect will the derating of the American mortgagee have on the financial markets?
That’s the question that’s currently being answered, although I’m somewhat foggy as to implications beyond the current upheaval.
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