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kewp
ParticipantI’m a recently-recovered doom & gloomer.
While there will definitely be folks hit hard in the coming years, especially folks with overly dependent on the RE industry, I doubt its going to hit a full-blown depression.
I base this largely on personal experience, the vast majority of people I know (including myself) here in SD are either renters or pre-bubble owners (that re-fi’ed to lock in low interest rates). Only a few are in businesses that are even partially affiliated with real estate.
The one person I know that had one of these ARM-bombs just had a short-sale on his home and is going to rent until the market stabalizes.
I personally have no equity tied up in RE, only a little debt that I’m paying off steadily and guaranteed stable employment, depression or otherwise. Heck, a depression would be a win for me (assuming I don’t get murdered by an ex-flipper looking to steal my shoes); as goods, services and RE would be dirt cheap.
Maybe I just have smart friends (well, I know I do), but I really wonder what percentage of the US population is really as over-extended as everyone here claims.
My impression of the great depression is that it was caused by a clear majority of the lower-middle classes overextending themselves on credit combined with a excessive stock market speculation. The story of the shoe-shine boy becoming a paper millionaire in a few months, for example.
Not to say there aren’t parallels with the current state of affairs, its just the scope of thing isn’t anywhere near the same scale.
I would like someone more informed then I back this up with some data, though.
Participant“I’m reading this: http://www.john-daly.com/solar/solar.htm
You may rebut that if you’d like.”
I’ll rebut that!
The author, the late Theodor Landscheidt, was an astrologer.
Yup, horoscopes, neptune is in the ninth quarter, pluto is up uranus, etc.
In this case he applies his copious background of astrological and numeroligical techniques to link solar cycles to wordly climate events. Complete crap of course. Total bollocks.
I encourage everyone to google “theodore landscheidt astrologer” if you don’t belive me. He’s published on John Daly’s site because he couldn’t get any of his stuff into any real journals. I’m assuming because its total garbage.
If a fraud like Landscheidt is the best you can come up with, you are lost. Completely.
Participant“I agree w/ kewp. That is the fundamental. When income support the price. Be it income triples to match current price or some kind of combination of falling price and income rise.”
Hehe, not bloody likely. As Rich says, wages are flat. My own personal experience is this is a stingy area for salaries especially, I only make a few grand more now than what I did when I moved here in ’99. And this is with a few job changes!
I wonder how many of these RE perma-bulls are business owners that pay their employees minimum wage? Amazing the amount of cognitive dissonance that goes on these days.
My serious opinion is that it will take three things to bring the market down (in order of importance).
1. Public Perception
RE is a shitty investment. Always has been. Once the public mindset shifts and everyone realizes they are either holding a white elephant, or thinking of buying one, will the prices really correct en masse’. Remember, its buyers that ultimately set the prices, not the sellers.
2. End of easy credit/easy fraud
Once the sub-prime market collapses I think indeed the market will correct itself, as the lenders are going to have a hard time convincing anyone to buy mortgage-backed securities. Heck, just enforcing the current standards would probably be enough.
Would be nice if the gubbmint regulated this area more, but we will probably have to wait until the Dem’s are back in power.
3. Foreclosures
Banks aren’t interested in holding properties and waiting for a rebound, so they are going to sell for whatever they can get. This should help return the market to equilibrium.
The most important point is as long as there are folks willing to buy property at the current prices (regardless of what loan product they use), they are going to stay where they are.
Participant“And you’re not blinded and unbiased?”
Of course I’m biased! I would love to think that AGW was a bunch of hippie BS and we could all burn fossil fuels guilt-free.
I, unlike some people however, acknowledge my biases and turn to the scientific method and the peer-review process when I’m seeking the truth. Which, unfortunately in this case, comes to a conclusion that is the opposite to what I would very much like to believe. So I therefore must accept it.
Why on earth would I, or anybody, be biased *PRO* AGW? Maybe if you were a luddite or ELF nazi maybe, but what sane person would endorse it otherwise?
“The burden of proof is with IPCC, not the critics.”
You are making the claim the science is bad, the burden of proof is on *you* to prove it. Provide new research that invalidates the AGW hypothesis, or the IPCC. Get it published.
Until then, you are just an anonymous net nut, no different than the 9/11 conspiracy theorists.
ParticipantThe median income in San Diego County triples overnight?
February 20, 2007 at 1:47 PM in reply to: California Coastal Housing Market Will Not Collapse #45839Participant“Coastal prices are going to crash just like everywhere else. Just look at the prices from the mid-90s (after the last crash) as a baseline. They will still be more expensive than inland areas but it doesn’t mean they won’t drop hard.”
I dunno.
I’ve a few rich friends in the LaJolla area and I’ve seen multiple properties in their neighborhood (nice ones) sold, razed and rebuilt. Just so the owner could get just what he/she wanted. I doubt these were paid for with funny money, either.
There are enough cash millionaires around the world to keep prices up, though I’m sure there is going to be some drop.
ParticipantWhat is the lender going to do, break your legs if you can’t pay?
The house is the collateral, so I expect most folks will just toss the keys and walk if they can’t make the payments or find a buyer. The bank the sells the property for whatever they can get, keeping what payments have already been made. Not a loss for them in the short term.
Note thats its foreclosure sales that can deflate a market in a hurry. The bank has no emotion involved and just wants to liquidate the asset as soon as possible.
I’m not sure this could lead to deflation, unless the supply exceeds demand by so much the prices really go in the toliet. Always possible, though.
My question is what sort of consequence this will have on the FB. Bad credit? Bankruptcy?
Participant“My final question that I find worth asking, if at least rhetorical: if AGW is obviously true, then why isn’t the IPCC acting with the same routine scientific integrity expected of any science body? In science, results are supposed to speak for themselves.”
They are, you are just too blinded by your own biases to accept it.
The IPCC gets routinely criticized in the science circles for being *too* conservative, if they are criticized at all.
Speaking of routine scientific integrity, you do realize that the sites you often reference, such as climateaudit and junkscience.org, have exactly none? No original research, no peer review?
Participant“To me this seems like a classic case of propaganda: solidify public opinion on the matter, making the actual scientific data secondary, and when rebuttals are made on the release data in May, they won’t make the headlines because public sentiment has already been “fixed” (i.e. it’s too late to roll back the wave).”
Oh, so we should discard the peer-review process in favor of a mass appeal to popularity? Keep in mind this is the same public the elected George W. Bush.
Twice.
This article reminds me of the mentality of the cult of denialsim…
http://www.guardian.co.uk/comment/story/0,,2016049,00.html
Participant“You sure have this obsession with “wrong!””
Moi? You’ve made it a lifestyle!
Participant“I should have been clearer. Greenland always had glaciation, but the amount of non-iced over land during 1000-1200 enabled Vikings to settle it and grow food. The cooling that occurred afterward (The Maunder Minimum) forced the Vikings to flee. The point here is that there are dramatic changes in climate that happens on a sub-century scale, and to believe that the one happening now *has* to be man-made seems to gloss over historical parallels.”
Yes, not surprisingly there have been localized climate trends throughout history. However, the emphasis needs to be on ‘localized’. There is currently no evidence this, or the ensuing ‘little ice age’ was a global phenomenon.
Unfortunately, the warming we are observing currently *is* global in nature.
“Sunlight. There are two other minor factors that come to mind: geothermal energy, and energy absorbed and reemitted as infrared radiation by greenhouse gasses (yes, that’s what you guys are going to jump on).”
Wrong again! You missed a real biggie, surface area!
More dark water (versus white ice) mean more absorbed radiation and more warming. One of those nasty feed-forward mechanisms you will hear about more in the future.
Here, read about it !
http://news.independent.co.uk/world/science_technology/article312997.ece
Or is this more hippie propaganda?
February 19, 2007 at 1:57 PM in reply to: California Coastal Housing Market Will Not Collapse #45773ParticipantI’ll agree somewhat, in that there will always be a market for premium properties, especially in coastal California.
Some caveats:
I think some of the less-upscale areas may take a dive (PB, OB), while the DelMar/LJ areas will do ok.
These properties are inherently at high risk, regardless of the housing market, to environmental issues. Hurricanes, tsunamis, coastal flooding, etc. It only takes one bad event to wipe out a few billion dollars of equity.
Participant“If man starting spewing out most of the CO2 after World War II, why is most of the warming prior to it? Why did it get colder after World War II?”
What I find hilarious about you nuts is you think you are the first person in history to ask this question. Yeah, it never occurred to the thousands of career climate scientists to look into short term cooling trends.
The short answer is there was a small cooling trend during that era due to increased levels of aerosols in the troposphere, both from human industry and vulcanism (which was low earlier in the century). This type of pollution increases the tropospheres albedo thereby reflecting UV light and reducing global warming.
This is a well understood phenomena. I’ll suggest reading some real climate science from real climate scientists to get a better grasp of the issue:
Try to steer clear of the fossil fuel industry propaganda, you will end up even more confused than you are now.
Your entire position is basically an argument from ignorance. You don’t understand the existing science behind anthropogenic climate forcing, or even possess a basic understanding of the earths history. Greenland was ‘ice less’ a thousand years ago? Please!.
And we are drinking the Kool-Aid?
ParticipantAssuming you are correct, I would think the ‘urban core’ areas would increase in value (fundamental, not bubble) and the outlying areas would decrease.
However, that is assuming everything else remains the same. It’s just as likely new modes of transportation or working will become available that lower the costs associated with commuting.
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