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JWM in SD
ParticipantGood post HLS, it’s great to have an industry insider posting here. It’s obvious from a lot of recent posts that a lot of are only just now connecting the dots.
“Subprime bonds were risky to begin with, but Wall Street got VERY creative and carved them into tranches. So there were A rated bonds that were the “best” of the worst.
The rating agencies rated these bonds incorrectly!”More specifically, WS used the ratings to describe how the cashflows were to be allocated to the different tranches in the event of defaults at various levels and not about the composition of the individual loans in the tranches.
I have said here before, but a lot of posters here need to start looking at the macro picture instead of focusing on what is happening in SD alone because that is not seeing the forest for the trees and will lead to individuals lacking conviction and becoming knifecatchers over the next couple of years.
recommended reading:
Tanta at Calculated Risk (HLS, if you are really in the biz and don’t know who she is…well…)Mish Shedlock
People need to start opening their eyes. It’s the magnitude of the credit debacle that makes me insist that it doesnt make sense to buy a house right now regardless of what your financial circumstances are and especially not because of one’s emtional state over this issue.
I tolerate posts from the SD Realtors of this site, because that is their job to appear unbiased about the RE market here in SD. But I won’t hesitate to tell someone my real opinion.
Participant“That is a lot of money to lose. It was not like they were charging a high interest rate to begin with. Why are people taking that kind of risk for a puny return”
Uhhh, what the hell have the bears here and on other blogs been screaming about for the past 18 months bob???!!!
That’s the point man, it isn’t worth the return when you factor in the appropriate level of risk that actually present in the investment. That is true whether you are the ultimate bagholder of the RMBS or that SFR investment in San Marcos that doesn’t seem to be appreciating at 15% per year anymore.
The thing to really be concerned about is if they want you and I to pay for it through a bailout of either the homedebtors or the banking institutions.
Participant“That is a lot of money to lose. It was not like they were charging a high interest rate to begin with. Why are people taking that kind of risk for a puny return”
Uhhh, what the hell have the bears here and on other blogs been screaming about for the past 18 months bob???!!!
That’s the point man, it isn’t worth the return when you factor in the appropriate level of risk that actually present in the investment. That is true whether you are the ultimate bagholder of the RMBS or that SFR investment in San Marcos that doesn’t seem to be appreciating at 15% per year anymore.
The thing to really be concerned about is if they want you and I to pay for it through a bailout of either the homedebtors or the banking institutions.
ParticipantSorry Bugs, but I agree with Temecula Guy on this one. I think we’ll fewer of them over time because they won’t question what’s goin on anymore. If you examine the posts carefully you can tell they don’t really believe that anything is wrong with the market. As the media latches onto this story like a pitbull, J6Pack will be too sheepish to come here anymore.
ParticipantSorry Bugs, but I agree with Temecula Guy on this one. I think we’ll fewer of them over time because they won’t question what’s goin on anymore. If you examine the posts carefully you can tell they don’t really believe that anything is wrong with the market. As the media latches onto this story like a pitbull, J6Pack will be too sheepish to come here anymore.
ParticipantYeah, somehow Radelow, I don’t think you’re going to get an answer from her.
I suspect that after this week, there aren’t going to be too many more of these…”gee, I’m looking to buy housing bears, do you think it’s a good idea?” kind of posts anymore…amusing and sad as they are.
ParticipantYeah, somehow Radelow, I don’t think you’re going to get an answer from her.
I suspect that after this week, there aren’t going to be too many more of these…”gee, I’m looking to buy housing bears, do you think it’s a good idea?” kind of posts anymore…amusing and sad as they are.
Participant“It could last many more years, it doesn’t have to stop yet.”
Here’s where I diverge with your assertions. It will stop because the institutions lending the money to those greater fools do need to be worried about ROI and that is exactly what is happening right now.
Participant“It could last many more years, it doesn’t have to stop yet.”
Here’s where I diverge with your assertions. It will stop because the institutions lending the money to those greater fools do need to be worried about ROI and that is exactly what is happening right now.
Participant“We are all guilty of complacency today with anything other than cash.
I’m not predicting an economic collapse, but am aware that it could happen. I think that anyone who says it can’t is fooling themselves. I hope that it doesn’t happen.”Precisely. This is similar to the point that I’ve been trying to make at this site for a couple of months now. We need to stop being so myopic about the value of real estate in SD…that is not the real issue at hand. How credit and actual monetary assets are perceived and controlled is the issue. Once those issues are forced to be addressed, through financial collapse potentially, the ridiculous out balance issues will self correct, but not without a lot of pain to individuals who are on the wrong side of that correction.
Participant“We are all guilty of complacency today with anything other than cash.
I’m not predicting an economic collapse, but am aware that it could happen. I think that anyone who says it can’t is fooling themselves. I hope that it doesn’t happen.”Precisely. This is similar to the point that I’ve been trying to make at this site for a couple of months now. We need to stop being so myopic about the value of real estate in SD…that is not the real issue at hand. How credit and actual monetary assets are perceived and controlled is the issue. Once those issues are forced to be addressed, through financial collapse potentially, the ridiculous out balance issues will self correct, but not without a lot of pain to individuals who are on the wrong side of that correction.
ParticipantSD Realtor,
If your perspective is only from that of the housing market you may have point, but there definitely has been a tipping point with regard to the credit market and that is undeniable as of this week. The fact that the housing market is intrinsically tied to the credit though makes this debateable in my opinion.
The posters here need to stop looking at this from the prism of SD home prices and start looking at the macro picture instead. It is scary, but it will give you the confidenced needed to steer clear of bad advice right now.
Anyone looking to buy a house right whether they can afford it or not is making a bad financial decision given the economic circumstances that we are headed into at the moment.
ParticipantSD Realtor,
If your perspective is only from that of the housing market you may have point, but there definitely has been a tipping point with regard to the credit market and that is undeniable as of this week. The fact that the housing market is intrinsically tied to the credit though makes this debateable in my opinion.
The posters here need to stop looking at this from the prism of SD home prices and start looking at the macro picture instead. It is scary, but it will give you the confidenced needed to steer clear of bad advice right now.
Anyone looking to buy a house right whether they can afford it or not is making a bad financial decision given the economic circumstances that we are headed into at the moment.
ParticipantSpeaking of Empty Chamberhead, my wife listens to KOGO (I can’t stand KOGO) and apparently Georgie is trying to spin the median increase as meaning that everything is okay. Did anyone hear him this morning spewing this nonsense??
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