[Ozzie]

I agree that jumbo rates will come back down. CFC is in the lending business. The liquidity crunch will play out and there will be other lenders that will jump at the chance to undercut the rate gouging practices of Angelo and co.

This entire “credit crunch” is not really about subprime borrowers. It’s about the gamblers on Wall St. who made 1000 bets on every subprime mortgage and that multiplied the underlying, crappy asset. The creation of these derivatives and the inability of the rating agencies to be able to judge their actual worth (or to look the other way as they collected their fees and rated them as “A+ paper” so the traders could sell them) magnified the situation even further. A lot of people here harshly judge the borrowers who took out loans they couldn’t repay and I have no problem doing the same, but I have more contempt for the Wall Streeters who are getting killed.

[Ozzie]

I agree that 4S Ranch will be a good destination for the jobs that are coming. In 5 years those buildings as well as all the new ones being put up in Carlsbad and along the 5 corridor will be full of tenants. I expect at least one major Silicon Valley firm to open a campus here.

[Ozzie]

I agree that 4S Ranch will be a good destination for the jobs that are coming. In 5 years those buildings as well as all the new ones being put up in Carlsbad and along the 5 corridor will be full of tenants. I expect at least one major Silicon Valley firm to open a campus here.

[Ozzie]

I agree that 4S Ranch will be a good destination for the jobs that are coming. In 5 years those buildings as well as all the new ones being put up in Carlsbad and along the 5 corridor will be full of tenants. I expect at least one major Silicon Valley firm to open a campus here.

[Ozzie]

Negative amortization loans have been around for a long time. They are pretty easy to understand. The lender will allow you to pay less than a fully amotized payment for a certain lenth of time as long as they feel you have enough equity in the home (via down payment, etc) and a stable or growing income.

The “exotic” loans that everyone has panned are those made to mostly subprime or to people who had no means to repay the loan once it reset. In most cases, they were 100% LTV so there was no equity to protect the lender. The brokers who pushed them in many cases lied on the credit app about the borrowers income and assets. Dumb business practices by the lenders and criminal behavior by the brokers lead to tons of losses and pain.

As with any investment or purchase, if you don’t understand the terms then don’t buy or invest.

[Ozzie]

Negative amortization loans have been around for a long time. They are pretty easy to understand. The lender will allow you to pay less than a fully amotized payment for a certain lenth of time as long as they feel you have enough equity in the home (via down payment, etc) and a stable or growing income.

The “exotic” loans that everyone has panned are those made to mostly subprime or to people who had no means to repay the loan once it reset. In most cases, they were 100% LTV so there was no equity to protect the lender. The brokers who pushed them in many cases lied on the credit app about the borrowers income and assets. Dumb business practices by the lenders and criminal behavior by the brokers lead to tons of losses and pain.

As with any investment or purchase, if you don’t understand the terms then don’t buy or invest.

[Ozzie]

I’m not trying to be a jerk, but you’re joking right? You are renting below market, letting them live there and make improvements (or trash the place in the name of improvements) and considering that “a sale”?

I sold my house in a rent to own recently but only in a short lease period (under 6 months) because I knew the family wouldn’t want to move in and move out in that short of time while paying 2 months move in plus 2 months sec. deposit. That is motivation to buy.

Good luck if you are tellng the truth.

[Ozzie]

I’m not trying to be a jerk, but you’re joking right? You are renting below market, letting them live there and make improvements (or trash the place in the name of improvements) and considering that “a sale”?

I sold my house in a rent to own recently but only in a short lease period (under 6 months) because I knew the family wouldn’t want to move in and move out in that short of time while paying 2 months move in plus 2 months sec. deposit. That is motivation to buy.

Good luck if you are tellng the truth.

[Ozzie]

Wow, I thought people on this board were smarter than this. The entire video is SARCASM. Geeez, some people lose all their sensibility when they think someone is defending their opinion.

I might have to send him an email with a link to this thread. I guarantee he’d mention on his TV show.

[Ozzie]

Wow, I thought people on this board were smarter than this. The entire video is SARCASM. Geeez, some people lose all their sensibility when they think someone is defending their opinion.

I might have to send him an email with a link to this thread. I guarantee he’d mention on his TV show.

[Ozzie]

I think that area will do very well over the next 20 years. Buinesses and jobs are moving in that direction so it’s in the path of progress which was not the case 10-15 years ago. I have a friend who owned a dump in Victorville fro his military days and it cash flowed, but it saw virtually no appreciation for 15 years. He sold in about 2000 for little more than he paid and since then the place has at least doubled (from about $75k to 150k+ – but it was a dump)

Think of it as Rancho Cucumonga 10 years ago. You can buy a new, 4,000 square foot home with quality construction on 1/2 acre in the 600’s so there is certainly an appeal there for those who are cost conscious, want a McMansion, and don’t mind an extra 45 minutes in the car.

With that said you need to understand that land values have gone down 20-30% in the last 18 months and you should intend on holding the land for another 5-10 years so you are selling as prices rise again. There’s also the question of the current zoning, what surrounds the land, are you going to entitle it during ownership, etc. I’d talk to land and commerical brokers in the area and get a feel for who the big players are (American Housing does a lot of residential out there) and follow their lead. No need to be a trendsetter. Sometimes it’s better to sit back and let others create the value (by spending their money on new roads, etc) and then capitalize on it. A great way to look for large swaths of land that will increase in value is to look at the California DOT website or the county website and find out where they are putting new exits on freeways and major thoroughfares. That’s where the new Targets and Wal Marts will be located

Good luck!

[Ozzie]

I think that area will do very well over the next 20 years. Buinesses and jobs are moving in that direction so it’s in the path of progress which was not the case 10-15 years ago. I have a friend who owned a dump in Victorville fro his military days and it cash flowed, but it saw virtually no appreciation for 15 years. He sold in about 2000 for little more than he paid and since then the place has at least doubled (from about $75k to 150k+ – but it was a dump)

Think of it as Rancho Cucumonga 10 years ago. You can buy a new, 4,000 square foot home with quality construction on 1/2 acre in the 600’s so there is certainly an appeal there for those who are cost conscious, want a McMansion, and don’t mind an extra 45 minutes in the car.

With that said you need to understand that land values have gone down 20-30% in the last 18 months and you should intend on holding the land for another 5-10 years so you are selling as prices rise again. There’s also the question of the current zoning, what surrounds the land, are you going to entitle it during ownership, etc. I’d talk to land and commerical brokers in the area and get a feel for who the big players are (American Housing does a lot of residential out there) and follow their lead. No need to be a trendsetter. Sometimes it’s better to sit back and let others create the value (by spending their money on new roads, etc) and then capitalize on it. A great way to look for large swaths of land that will increase in value is to look at the California DOT website or the county website and find out where they are putting new exits on freeways and major thoroughfares. That’s where the new Targets and Wal Marts will be located

Good luck!

[Ozzie]

Cashman,

As today’s WSJ points out there has never been a start to a Bear market with the current fundamentals in place. Obviously all bets are off if a recession comes about, but I think the earnings for the stocks I own (oil services, infrastructure plays) will continue to benefit from the world economy. Domestic guys like homebuilders, Home Depot, Countrywide, etc will continue to see earnings tumble through 2008 and I’ll add to some put positions there in the coming weeks, but it’s a big world outside the US and we have some global leaders here who will continue to perform.

That’s my story and I’m sticking to it.

[Ozzie]

Cashman,

As today’s WSJ points out there has never been a start to a Bear market with the current fundamentals in place. Obviously all bets are off if a recession comes about, but I think the earnings for the stocks I own (oil services, infrastructure plays) will continue to benefit from the world economy. Domestic guys like homebuilders, Home Depot, Countrywide, etc will continue to see earnings tumble through 2008 and I’ll add to some put positions there in the coming weeks, but it’s a big world outside the US and we have some global leaders here who will continue to perform.

That’s my story and I’m sticking to it.

[Ozzie]

I work out like a fiend so my arteries should be very clean, and supposedly the Wagyu/Kobe beef (which is excellent BTW) contains the “good” fat. Just bought some at Seaside market in Cardiff the other day.

Barring a recession, a Dow at 11,000 would offer some screaming deals. 95% of my equity positions are for the long haul, but I have some cash waiting on the sidelines if things really get out of control. Heck, the PE of the SP 500 is barely above historical averages.

As for this debt bubble, I am more and more wary of the financials because I just don’t know what earnings are real anymore. If they can’t even figure out what the products they are selling to insitutional investors are worth how can we value the company? Smells like Enron. I’d like to hear Warren Buffet’s take on the credit markets. A few years ago I woke up (literally at night I had an epiphany)and asked myself “why am I trying to pick stocks when BRK offers you what is essentially the best mutual fund of all time?” I bought BRK the next day. Hopefully he’ll live until he’s 100 and BRK’s performance will stay steady as she goes.

I think the rest of the market is being thrown out with the bathwater until this credit situation improves. The Wall St. guys number one objective is to make money for themselves so if they are feeling pinched they’ll find a way to pinch the rest of the market.

[Author]

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