Robert Trudeau

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    • Sat Apr 19th 19:29 PM | Rating: 0 0
      Commented on:
      The Greenspan Defense
      P.S. Felix, love the drawing of you. Just like in the Wall Street Journal isn't it.
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    • Sat Apr 19th 19:27 PM | Rating: 0 0
      Commented on:
      The Greenspan Defense
      Gee, people with bad credit default on their mortgages more frequently than people with good credit, and homes prices in lower income areas fell further than in more affluent areas. What insight, give this man a Nobel prize! Don't even get me started on negative amortization zero down no income or asset documentation ARMs.
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    • Sat Apr 19th 19:13 PM | Rating: 0 0
      Commented on:
      Larry Kudlow is Dead Wrong: CRA Didn't Start the Meltdown
      Kudlow is a wall street cheerleader. All that is missing is a skirt and pom poms. Free market believer that he is, the investment banks had nothing to do with it. It was the governments fault. A fierce supply sider and pseudo economist, Kudlow believes the working class idiots should bear the burden of their mistakes, and not the Harvard educated Wall Street geniuses who created these ridiculus mortgage derivatives. There are a lot of villans in this mess; politicians, regulators, the Fed, investment banks, commercial banks, mortgage brokers, real estate agents, and people who bought a home while hoping that real estate prices would keep going up.
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    • Sat Apr 19th 18:56 PM | Rating: 0 0
      Commented on:
      IMF Study Finds Housing Prices Closely Linked to Monetary Policy
      Screw Ron Paul.
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    • Sat Apr 19th 18:55 PM | Rating: 0 0
      Commented on:
      IMF Study Finds Housing Prices Closely Linked to Monetary Policy
      And by the way, don't lend money to people under terms where they won't be able to pay you back.
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    • Sat Apr 19th 18:53 PM | Rating: 0 0
      Commented on:
      IMF Study Finds Housing Prices Closely Linked to Monetary Policy
      Duh! This article should have not been longer than three sentences. Low interest rates and lots of dollars equals higher home prices. High interest rates and fewer dollars equals lower home prices. You don't want home prices to get too high or you get a bubble.
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    • Sat Apr 19th 17:08 PM | Rating: 0 0
      Commented on:
      What's Ahead for Real Estate: Doing the Math
      Harm, great article. Rather than useless ramblings you have given specific ratios to determine a bottom. We are not even close to a bottom. Rents are still considerably less than the cost of ownership, and many folks are meeting the difference in hopes of making it through the bottom. I agree with Credit Suisse that we are probably looking at 2011 before we get there. I sold in May 2005 and will only buy again when prices reach a level that makes financial sense to do so.
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    • Sat Apr 19th 16:50 PM | Rating: 0 0
      Commented on:
      Homebuilders Remain Pessimistic - Housing Tracker
      Buy the builders? What, so you can own land that isn't being developed, or land purchase options that expire worthless, or empty homes decling in value. Buy the builders only if you believe the market has bottomed, and please give me some evidence of that so I can make money too. Otherwise you are better off in cash for the foreseeable future.
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    • Sat Apr 19th 16:41 PM | Rating: 0 0
      Commented on:
      Housing Starts Down, Consumer Prices Up
      Ames, here in Phoenix housing starts were on the periphery, where no one but investors wanted to buy. In these developments, every other house is for sale, and many sit empty. Until infrastructure is in place they will remain undesirable. Overall, supply won't come down until prices come down, and people believe they won't fall further. In fact, overall supply will likely go up over the next couple of years as more homes go into foreclosure, even with no further building.
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    • Sat Apr 19th 16:34 PM | Rating: 0 0
      Commented on:
      Housing Starts Down, Consumer Prices Up
      The questions isn't high inflation, we can all agree on that. The question is how high inflation will go, and what will the Fed need to do to bring it back under control. Presently, the Fed can not combat inflation without causing further dramatic deflation in the housing market and a severe recession. It can only fight one fire at a time. I'm afraid we are going to be paying for this housing crisis for years to come.
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    • Sat Apr 19th 16:19 PM | Rating: 0 0
      Commented on:
      Option ARMs and the Next Wave of Foreclosures - Housing Tracker
      Thanks for the stats. It is folly to believe that the US government can prop up the housing market, it is simply too big, and there are implications to flooding the economy with dollars. The Fed has blown nearly half its wad, and the real estate market has about another 20% to fall before we reach rational valuations. The government doesn't actually fund mortgages, investors do, and bond investors hate inflation, which will run out of control if the government has to make good on trillions of dollars in mortgages. You are right that only a limited number of people will actually be helped, but it sure does a lot to calm people when they see headlines in the newspaper.
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    • Sat Apr 19th 16:06 PM | Rating: 0 0
      Commented on:
      A Warning in the Bond Market
      The problem was created when Wall Street created mortgage products that allowed Main Street to by houses at absurdly high prices. I don't know of anyone on Main Street who went to Wall Street and asked them to pool negative amortization mortgages into CDO's. Moving forward, most folks will not buy houses based solely on the monthly payment, they'll buy based on what they think the value of the house will be 5-10 years down the road when they want to sell. People aren't dumb, they just hadn't seen falling real estate prices like we have today, and most weren't around during the Great Depression. They have been educated.
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    • Sat Apr 19th 15:55 PM | Rating: 0 0
      Commented on:
      A Warning in the Bond Market
      I respectfully disagree with nearly everything you have stated. Investors WILL accept 2.5% on a 10 year if they believe that there will be no inflation, or possibly deflation, over that time frame. A real return of 2.5% on bonds is attractive, and about in-line with histroical returns. The Fed does not control interest rates, the global market does, that is why their are treasury auctions. If the Fed had its way, long-term rates ie. mortgage rates would be much lower than they are today. The Fed doesn't fund mortgages, investors do. What the Fed can do is dump money into the economy at low interest rates and it has done so, with M3 growing by about 18%. The temporary spike in interest rates on the 10 yr is due to the fact that the market now believes the worst is behind us and that the economy will continue growing. Don't believe in efficient markets.
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    • Sat Apr 19th 15:35 PM | Rating: 0 0
      Commented on:
      Ten Things You Can Worry About
      Thinkbig, sorry I forgot about your question. The solution, and it is already being implemented, is to deleverage. For individuals this means to pay down their debt and start saving, or in other words to stop consuming more than they produce. For the U.S. government it means to balance the budget, and reduce the deficit. This is the only way to give support to the dollar, and to maintain our standard of living. The author is absolutely correct that ultimately, those folks overseas who lend us and our government the money we spend will stop lending to us if they don't feel we are able to pay them back, or are going to pay them back with devalued dollars. Up until now, their fates were so tied to ours that they have been willing to look the other way. Yes this means slower growth for the US economy, but slower growth sure beats the alternative.
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    • Sat Apr 19th 15:22 PM | Rating: 0 0
      Commented on:
      Ten Things You Can Worry About
      No new information, but I agree with your comments. Yes, there is a Global energy, real estate, and food crisis. That is the crux of the problem, it is not isolated to any one country or region of the world. With M3 growing at an annualized rate of 17-18%, and real U.S. inflation as caculated in 1980 at 12%, sooner or later even the Saudi's will start rethinking their position on the dollar. I don't even want to think about the consequence of that to our highly leveraged economy. As for the investment banks, why should they care about risk control. They make a killing on the upside, and the Fed covers their downside. Talk about encouraging risky behavior. Buffet won't touch most of their illiquid, impossible to understand derivatives. No one knows what the equilibrium price of oil is, but if we don't find a lot more of it within the next few years, we'll sure find out, and it will finally begin to slow global growth. You are exactly right about prime mortgages if home values fall another 20%, which is what I anticipate, although that pain will be spread out over more time than the sub-prime melt down. Food is a big problem when you are talking staples like wheat and rice. This hits everyone, and unlike oil/gas you can't compensate by cutting back on consumption.
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