patrick.net

Years of pumping money in by the Fed and where are we? Until the real unemployment number is down significantly let's not talk recovery. Political deception at its finest.

Analyzer says

Until the real unemployment number is down significantly let's not talk recovery.

The blog post makes that clear!

The non farm payroll last week showed just how poorly the job market is doing.They revised downward the prior June and July by 74,000 too!

Recovery for the rich, most of the others continue the struggle.

Analyzer says

Recovery for the rich, most of the others continue the struggle.

Yep if you had a job, good credit and some money-low rates hooked you up. If you didn't you watched other people make the money back they lost in the stock and real estate market in 2008/09

Link from Call it Crazy
That puts the index at its lowest since November 2008 and the depths of the financial crisis.

http://patrick.net/?p=1229258

Call it Crazy says

and doesn't want to see his "investments" lose value.

Thank you for the tip. 'Never put all your eggs in one basket' is another that comes to mind.

David9 says

Call it Crazy says

and doesn't want to see his "investments" lose value.

Thank you for the tip. 'Never put all your eggs in one basket' is another that comes to mind.

Yep

Would like to see the present and forward looking data that says the economy is improving and home prices will continue to rise

smaulgld says

Would like to see the present and forward looking data that says the economy
is improving and home prices will continue to rise

Ditto, as you are right on.

I don't like having 2 sides for the housing market.
I don't like seeing articles suggesting it's 'all a hoax'.
I don't like the Blockbuster in Tarzana is closing as of yesterday.
I don't like seeing all the for lease signs.
I don't like I have friends out of work.

I should add there are a few out there that really just want to post an unbiased opinion based on the data they have, however these are not the majority.

Analyzer says

Maybe Bernanke should have just used words to move the market and rates all along instead of injecting boat loads of money. If he only had known it was so easy.

Case in point from the blog post
"(He) Bernanke admitted that his experiment hadn’t worked and that if rates rose as the program ended, the economy would tank. In this testimony, Bernanke indicated that he wanted to keep rates low so the economy would not tank but no longer wanted to use QE purchases to do so; he would just keep the Fed Funds rate low. He wanted the non existent/limited benefits of near zero interest rates but didn’t want to have to print money to pay for those benefits! "

And what happened next- when people realized the fed wasn't going to be buying- rates went higher

Analyzer says

I'm actually afraid of some of these lunes............................

Understood

There does seem to be a lot of hostility, name calling and profanity here

Tomorrow we will get initial jobless claim data
If we didn't lose too many we'll hear everything is fine-even though we know that people not losing their jobs does not equate to hiring

Oh dear.

egads101 says

Analyzer says

Most people get their information from the mainstream media. I am not following where it is being frequently reported in the media as to the coming crash in real estate.

Is that a joke? or is that really how you think?

Do you have something that shows otherwise?

Call it Crazy says

Yep, all the signs of a "normal" housing market.....

All driven by design by the Fed

smaulgld says

It would be further evidence of a declining economy where fewer people can afford their own homes and the ones that can will pay more.

Our economy doesn't rely on an equilibrium of what people can afford.
It relies on a well managed disequilibrium.

At the equilibrium point, the quantity of money doesn't matter. If you double the quantity of money, and wait for equilibrium, everything will just cost twice the amount of money. In a balanced world QE would be useless.

Heraclitusstudent says

If you double the quantity of money, and wait for equilibrium, everything will just cost twice the amount of money. In a balanced world QE would be useless.

True
But I think you are assuming that everyone gets an equal amount of the 2X money at the same time.
If it is distributed out of proportion to the amounts that people already have and to some before others,those with a disproportionate amount of extra$$ who get it early benefit.Those who get less or the same but receive it later don't benefit at all but pay the higher prices

smaulgld says

But I think you are assuming that everyone gets an equal amount of the 2X money at the same time.

No. Those that get more money initially may benefit, but as they spend it to get more stuff, money will spread and prices rise until a new equilibrium is obtained at the same point.

This is why it has to be a continuous flow of new money. Ideally you would also compensate it by a continuous flow of new poor people (migrants) and competition with cheap labor countries to keep wages low.

This gives you the best continuous disequilibrium possible where the money percolates continuously but very slowly to the average Joe.

Heraclitusstudent says

. Those that get more money initially may benefit, but as they spend it to get more stuff, money will spread and prices rise until a new equilibrium is obtained at the same point.

Those that get the money first benefit from the windfall of extra $$ and can spend them at the current prices. The people who get the money last (whether equillibrium is achieved) get screwed as the $$ they receive have the effect of inflation

egads101 says

nitwits

That's a nice one-"knucklehead" always amused me

Call it Crazy says

I think that's his pet name for the ones he really likes!!!

You know you are in special company when an expletive beginning with "F" precedes it

APOCALYPSEFUCK is Comptroller says

Is Cannibal Anarchy so hard to spell?

Not if you can spell it

APOCALYPSEFUCK is Comptroller says

Is Cannibal Anarchy so hard to spell?

Did you win the election?

Incidentally, while I do somewhat malign some posters here for my SIL's predicament - the one person I really do blame more than others is Patrick. As the one having a blog, I really hold him to a higher standard. In particular, the one area where Patrick really is deserving of scorn is his continued insistence that at the bottom even in the desirable areas the cost to rent "must" equal the cost to buy.

On more than one occasion a poster would ask if a particular place was OK to buy. Patrick would respond that the guy should "wait" because comparing price versus rent revealed the place was "nowhere near the bottom". Invariably, his analysis always had an air of "certainty" when the reality is, Patrick had no real clue whether rental parity was ever reality in certain desirable areas.

Well, long story short, my SIL took this in particular to heart. In 2009, since renting in her desired area was 40% cheaper than buying, she naturally assumed that prices would drop 40% if she too "waited" as Patrick had advised. Imagine her horror as prices not only didn't drop, but rose 20% (now past the 2006 peak), but her rent was raised over 20% in the last 4 years as well.

As you can imagine, her continued insistence to rely on Patrick's rules for the bottom caused numerous shouting matches with extended family members - lots of traded accusations of who was delusional... Its only in the last year (as Patrick's disposition changed from "wait" to "rent forever" that she woke up and realized how badly she was being hurt by listening to this advice. At the end of the day, she, like so many here was going to buy eventually...all she wanted was assurances that prices were not going to suffer a massive second leg down (such that renting costs would come in line with buying costs).

@Patrick - Ive never mentioned any this before, but I sincerely hope you see this. In all fairness, you (mostly 2005-2009) certainly have done a tremendous amount of good - you saved many people from devastating financial mistakes - no question about that.

That said, as you and I have discussed, your continued insistence (circa 2009-2012) on telling people to "wait" until prices = rents (especially since you had little idea if it was historically correct or not) you have harmed people in ways you can hardly imagine.

Now Bob, have you been here all day, again today?

You, and I both know you are full of crap, and have misrepresented yourself either here or on the cancer blog you've been trolling since 2011.

So you are aware of my finances, as I must be aware of yours. Cancer costs a bunch of dough, especially when you start out self insured.

This blog is a little more open than the cancer blog so I'll take you on here, again.

Which persona is the real you Bob, the one here, or the one where you dispense medical advice?

Let's see, medical expert, Real Estate expert, Community College Professor, or Engineer, it must be tough keeping it all straight.

egads101 says

you and 100's of other nitwits have confidently predicted a housing price crash for the last five years on here. the pack of you couldn't have been more wrong if you tried.

If you observe closely there are clear behavioral patterns that emerge on these threads. If someone does not have a credible answer or do not like the real answer they often resort to name calling and chest thumping. I am positive I already know how long I will be waiting for any evidence to be provided that I predicted a housing price crash.

It is also interesting that someone would spend/waste so much time posting to a board full of nitwits. If you can't beat em, join em....................

smaulgld says

Tomorrow we will get initial jobless claim data

If we didn't lose too many we'll hear everything is fine-even though we know that people not losing their jobs does not equate to hiring

The july "gains" were nicely revised downwards from about 160000 to a laughable 104000.

Facebooksux says

smaulgld says

Tomorrow we will get initial jobless claim data

If we didn't lose too many we'll hear everything is fine-even though we know that people not losing their jobs does not equate to hiring

The july "gains" were nicely revised downwards from about 160000 to a laughable 104000.

Don't we all wish we could have high paying government jobs that require no accountability?

egads101 says

Analyzer says

egads101 says

Analyzer says

Most people get their information from the mainstream media. I am not following where it is being frequently reported in the media as to the coming crash in real estate.

Is that a joke? or is that really how you think?

Do you have something that shows otherwise?

works for me.

You claimed there was a coming real estate crash that for some reason, the media is not reporting...

then, you claimed I need to provide evidence it isn't coming. hello mcfly how about ALL housing data, none of which shows any crash coming?

Whoa man, I honestly cannot follow your logic. Are you practicing for running for public office in the near future?

And inventory is up in your hometown Concord as well:

And it's up in Roberto's home town as well:

egads101 says

Facebooksux says

The july "gains" were nicely revised downwards from about 160000 to a laughable 104000.

the thing is, with the sequester, gains of any size are a good sign for the future.

Or did you like it better five years ago, when we were losing 600,000 jobs a month?

Stop trolling Roberta.

smaulgld says

I was right- I wasn't talking about LA specifically. BUT since you mention it:

When I said inventory would rise in June -LA had 1,439 listings and by August it had 1,554

Price reductions went from 450 in June to 607 in August

Los Angeles Real Estate Trends

http://www.movoto.com/statistics/ca/los-angeles.htm

AND since August:

"Los Angeles's home resale inventories increased, with a 6 percent increase since August 2013."

http://www.movoto.com/statistics/ca/los-angeles.htm

"The median listing price in Los Angeles went down from August to September. There were a total of 169 price increases and 607 price decreases."

Sounds exactly like the reversal I predicted here: http://smaulgld.com/the-coming-supplydemand-real-estate-inventory-reversal/

And in Phoenix we see the same
Inventory up, price reductions up
There were a total of 299 price increases and 1599 price decreases.
http://www.movoto.com/statistics/AZ/phoenix.htm

smaulgld says

Sounds exactly like the reversal I predicted here: http://smaulgld.com/the-coming-supplydemand-real-estate-inventory-reversal/

And in Phoenix we see the same

Inventory up, price reductions up

http://www.movoto.com/statistics/AZ/phoenix.htm

Or try Las Vegas
inventory up, price reductions up
http://www.movoto.com/statistics/nv/las-vegas.htm

Hi --

National housing prices are an interesting measure -- but not especially relevant to the value of your house or mine.

The reason is that real estate is a localized commodity. The same house located somewhere else will have a different value.

The best measure of relevant home values is the pricing in your neighborhood.

OurBroker says

The reason is that real estate is a localized commodity. The same house located somewhere else will have a different value.

The best measure of relevant home values is the pricing in your neighborhood.

This is 100% true. The one constant for every neighborhood however is the mortgage interest rate.
Employment, wages, neighborhood amenities, housing quality, inventory, foreclosure rates etc are different from town to town.

But higher rate impacts just about all neighborhoods
And we did see from 2003-2006 how we had a national housing boom/bubble due to low rates and a national crash.

We also had earlier this year a national housing bubblet driven by low rates

Agreed. Home prices are local and mortgage rates are largely national, with little variation among regions.

egads101 says

RentingForHalfTheCost says

And you are predicting prices will hold steady or rise from here? Just getting you on the record, or are you only here for amusement.

Prices one year from today will be higher in Phoenix, higher in almost every part of California, and higher US wide.

Not as much higher as last year's 24% in Phoenix, and 12% countrywide, but higher nonetheless.

What is driving them higher?