Forum Replies Created
-
AuthorPosts
-
patientrenter
ParticipantDeal Hunter, how did you conclude that the most likely outcome of all this is a massive victory for hard-core Republican political goals? I don’t care about the politics, but I can see that the Republican party’s agenda is near-dead. In November, no one thinks that either the House or Senate will go Republican. The only question is whether the character of the Republican candidate can overcome the political groundswell in favor of the Democrat agenda.
The long-term outcome of this still-emerging massive bail-out will be the same as for every other temporary expansion of government in the last 100 years – a permament expansion. From now on, home prices will be determined directly by the Federal govt’s finger on the money spigots. When next prices go down after this little event, they will have lots of new spigots to open.
Patient renter in OC
ParticipantDeal Hunter, how did you conclude that the most likely outcome of all this is a massive victory for hard-core Republican political goals? I don’t care about the politics, but I can see that the Republican party’s agenda is near-dead. In November, no one thinks that either the House or Senate will go Republican. The only question is whether the character of the Republican candidate can overcome the political groundswell in favor of the Democrat agenda.
The long-term outcome of this still-emerging massive bail-out will be the same as for every other temporary expansion of government in the last 100 years – a permament expansion. From now on, home prices will be determined directly by the Federal govt’s finger on the money spigots. When next prices go down after this little event, they will have lots of new spigots to open.
Patient renter in OC
ParticipantDeal Hunter, how did you conclude that the most likely outcome of all this is a massive victory for hard-core Republican political goals? I don’t care about the politics, but I can see that the Republican party’s agenda is near-dead. In November, no one thinks that either the House or Senate will go Republican. The only question is whether the character of the Republican candidate can overcome the political groundswell in favor of the Democrat agenda.
The long-term outcome of this still-emerging massive bail-out will be the same as for every other temporary expansion of government in the last 100 years – a permament expansion. From now on, home prices will be determined directly by the Federal govt’s finger on the money spigots. When next prices go down after this little event, they will have lots of new spigots to open.
Patient renter in OC
ParticipantSpot on, SDR! This just allows the GSEs to wade in deeper. They want to, and they are being told to. They will wade in deeper.
If and when they stumble and are in danger of getting submerged, the federales will arrive. There will be shock, absolute shock, at the discovery that 80-95% non-recourse loans that were made at today’s So Cal prices are going bad. Since no one could have known that, there will be a rescue for the good ol’ Fannie and Freddie brownies/boy scouts, and the homeowners and investors all. It’s so patently obvious what’s happening.
Patient renter in OC
ParticipantSpot on, SDR! This just allows the GSEs to wade in deeper. They want to, and they are being told to. They will wade in deeper.
If and when they stumble and are in danger of getting submerged, the federales will arrive. There will be shock, absolute shock, at the discovery that 80-95% non-recourse loans that were made at today’s So Cal prices are going bad. Since no one could have known that, there will be a rescue for the good ol’ Fannie and Freddie brownies/boy scouts, and the homeowners and investors all. It’s so patently obvious what’s happening.
Patient renter in OC
ParticipantSpot on, SDR! This just allows the GSEs to wade in deeper. They want to, and they are being told to. They will wade in deeper.
If and when they stumble and are in danger of getting submerged, the federales will arrive. There will be shock, absolute shock, at the discovery that 80-95% non-recourse loans that were made at today’s So Cal prices are going bad. Since no one could have known that, there will be a rescue for the good ol’ Fannie and Freddie brownies/boy scouts, and the homeowners and investors all. It’s so patently obvious what’s happening.
Patient renter in OC
ParticipantSpot on, SDR! This just allows the GSEs to wade in deeper. They want to, and they are being told to. They will wade in deeper.
If and when they stumble and are in danger of getting submerged, the federales will arrive. There will be shock, absolute shock, at the discovery that 80-95% non-recourse loans that were made at today’s So Cal prices are going bad. Since no one could have known that, there will be a rescue for the good ol’ Fannie and Freddie brownies/boy scouts, and the homeowners and investors all. It’s so patently obvious what’s happening.
Patient renter in OC
ParticipantSpot on, SDR! This just allows the GSEs to wade in deeper. They want to, and they are being told to. They will wade in deeper.
If and when they stumble and are in danger of getting submerged, the federales will arrive. There will be shock, absolute shock, at the discovery that 80-95% non-recourse loans that were made at today’s So Cal prices are going bad. Since no one could have known that, there will be a rescue for the good ol’ Fannie and Freddie brownies/boy scouts, and the homeowners and investors all. It’s so patently obvious what’s happening.
Patient renter in OC
ParticipantAt this point, the war about massive govt intervention is over, and they are just arguing over how to clean up the accounting. The war ended when the FHLB was given the green light in 2007 to pump in unlimited funds for Countrwide and other lenders still offering 90%+ loans on over-inflated homes. Over $500 billion was already pumped in during 2007, and it’s still flowing freely. The main aqueduct is flowing, and now they are just fine-tuning by opening as many other spigots as they can think of.
Natural economic forces would take home prices in So Cal down by 50% in a few months, I would guess. After all, just think if you’d lend some homebuyer, with your own unborrowed cash savings, a non-recourse, no-prepayment penalty loan for 90% of today’s still-inflated prices, for a return of just 2-4% annually above what you could get on a 10-year Treasury. That’s what’s happening in today’s market, and obviously the only people doing it are banks and others who are getting explicit or implicit guarantees from you and me (the govt.).
So don’t get upset about the future. It’s already in the past!
Patient renter in OC
ParticipantAt this point, the war about massive govt intervention is over, and they are just arguing over how to clean up the accounting. The war ended when the FHLB was given the green light in 2007 to pump in unlimited funds for Countrwide and other lenders still offering 90%+ loans on over-inflated homes. Over $500 billion was already pumped in during 2007, and it’s still flowing freely. The main aqueduct is flowing, and now they are just fine-tuning by opening as many other spigots as they can think of.
Natural economic forces would take home prices in So Cal down by 50% in a few months, I would guess. After all, just think if you’d lend some homebuyer, with your own unborrowed cash savings, a non-recourse, no-prepayment penalty loan for 90% of today’s still-inflated prices, for a return of just 2-4% annually above what you could get on a 10-year Treasury. That’s what’s happening in today’s market, and obviously the only people doing it are banks and others who are getting explicit or implicit guarantees from you and me (the govt.).
So don’t get upset about the future. It’s already in the past!
Patient renter in OC
ParticipantAt this point, the war about massive govt intervention is over, and they are just arguing over how to clean up the accounting. The war ended when the FHLB was given the green light in 2007 to pump in unlimited funds for Countrwide and other lenders still offering 90%+ loans on over-inflated homes. Over $500 billion was already pumped in during 2007, and it’s still flowing freely. The main aqueduct is flowing, and now they are just fine-tuning by opening as many other spigots as they can think of.
Natural economic forces would take home prices in So Cal down by 50% in a few months, I would guess. After all, just think if you’d lend some homebuyer, with your own unborrowed cash savings, a non-recourse, no-prepayment penalty loan for 90% of today’s still-inflated prices, for a return of just 2-4% annually above what you could get on a 10-year Treasury. That’s what’s happening in today’s market, and obviously the only people doing it are banks and others who are getting explicit or implicit guarantees from you and me (the govt.).
So don’t get upset about the future. It’s already in the past!
Patient renter in OC
ParticipantAt this point, the war about massive govt intervention is over, and they are just arguing over how to clean up the accounting. The war ended when the FHLB was given the green light in 2007 to pump in unlimited funds for Countrwide and other lenders still offering 90%+ loans on over-inflated homes. Over $500 billion was already pumped in during 2007, and it’s still flowing freely. The main aqueduct is flowing, and now they are just fine-tuning by opening as many other spigots as they can think of.
Natural economic forces would take home prices in So Cal down by 50% in a few months, I would guess. After all, just think if you’d lend some homebuyer, with your own unborrowed cash savings, a non-recourse, no-prepayment penalty loan for 90% of today’s still-inflated prices, for a return of just 2-4% annually above what you could get on a 10-year Treasury. That’s what’s happening in today’s market, and obviously the only people doing it are banks and others who are getting explicit or implicit guarantees from you and me (the govt.).
So don’t get upset about the future. It’s already in the past!
Patient renter in OC
ParticipantAt this point, the war about massive govt intervention is over, and they are just arguing over how to clean up the accounting. The war ended when the FHLB was given the green light in 2007 to pump in unlimited funds for Countrwide and other lenders still offering 90%+ loans on over-inflated homes. Over $500 billion was already pumped in during 2007, and it’s still flowing freely. The main aqueduct is flowing, and now they are just fine-tuning by opening as many other spigots as they can think of.
Natural economic forces would take home prices in So Cal down by 50% in a few months, I would guess. After all, just think if you’d lend some homebuyer, with your own unborrowed cash savings, a non-recourse, no-prepayment penalty loan for 90% of today’s still-inflated prices, for a return of just 2-4% annually above what you could get on a 10-year Treasury. That’s what’s happening in today’s market, and obviously the only people doing it are banks and others who are getting explicit or implicit guarantees from you and me (the govt.).
So don’t get upset about the future. It’s already in the past!
Patient renter in OC
Participantkewp, I think you’re right. With asset price inflation, borrowers (=majority of voting population) do very well, regardless of deflation or inflation. That’s what we’ve had for years. With asset price deflation, borrowers can only do well if they can default, or inflate away their debts, with inflation here defined using consumer prices and wages.
When projecting the future, always be aware of what works best for the majority of voters. Politicians may be corrupt or statesmanlike, but few politicians are going to do anything to stand between the majority of voters and their dreams of wealth without saving*.
*Saving defined as earned income less consumption spending, excluding capital gains/losses.
Patient renter in OC
-
AuthorPosts
