Real Estate Market / Inflation / Recession / Depression (Colorado Springs: mortgage, environment, credit)

[LBear]

Originally Posted by sterlinggirl

Hey LBear....how's the weather been for ya lately?

Very nice, thanks for asking...

[Bob from down south]

Originally Posted by jazzlover

Oh, and Bob, I'm sure you'll want to comment on Fannie Mae's sinking fortunes and what this will mean to the real estate markets. From MSN Money today Market Dispatches - MSN Money :

The just-departed former chairman of the St Louis Fed is now saying publicly that the GSEs (Fannie and Freddie) are insolvent. They owe $5Bn more than their assets are worth under fair-value accounting rules.

Fannie, Freddie Insolvent After Losses, Poole Says

And they are still rated triple-A by the useless and corrupt ratings agencies. I've said it before...ratings are next to meaningless now. Look at what happened with bond insurers Ambak and MBIA. It's an embarassment, and for those with their pensions and life savings in the stock market, it's a cover-up to lay a false sense of security on the bleating masses who blindly trust that their fund managers and the fed will save them.

Yesterday, the GSEs had to pay a 74 basis point premium to sell its bonds. That will translate into higher mortage rates, and continued pressure on a insanely overblown housing market all across the looted plains...including, and maybe even especially, Colorado.

And industry mouthpieces like Larry Yun, the NAR's clueless pumpboy, are talking openly about the GSEs being "too big to fail," meaning they want...no, they expect the US taxpayer to ante up at the tax bar and pick up the check for the last decade's worth of financial depravity.

[borborygmi]

Originally Posted by Bob from down south

The just-departed former chairman of the St Louis Fed is now saying publicly that the GSEs (Fannie and Freddie) are insolvent. They owe $5Bn more than their assets are worth under fair-value accounting rules.

Fannie, Freddie Insolvent After Losses, Poole Says

And they are still rated triple-A by the useless and corrupt ratings agencies. I've said it before...ratings are next to meaningless now. Look at what happened with bond insurers Ambak and MBIA. It's an embarassment, and for those with their pensions and life savings in the stock market, it's a cover-up to lay a false sense of security on the bleating masses who blindly trust that their fund managers and the fed will save them.

Yesterday, the GSEs had to pay a 74 basis point premium to sell its bonds. That will translate into higher mortage rates, and continued pressure on a insanely overblown housing market all across the looted plains...including, and maybe even especially, Colorado.

And industry mouthpieces like Larry Yun, the NAR's clueless pumpboy, are talking openly about the GSEs being "too big to fail," meaning they want...no, they expect the US taxpayer to ante up at the tax bar and pick up the check for the last decade's worth of financial depravity.

And if the goverment does end up bailing out Fannie Mae and Freddie Mac, it would be to the tune of about a 1 trillion dollar tax increase. I don't even want to think about what that would do to our already reeling economy. On the other hand, if either of these companies were allowed to simply fail, it would likely send the country into a full-blown depression. A pretty scary catch-22, if you ask me. Read here:

The Fannie and Freddie doomsday scenario - Jul. 9, 2008

[jazzlover]

Originally Posted by borborygmi

And if the goverment does end up bailing out Fannie Mae and Freddie Mac, it would be to the tune of about a 1 trillion dollar tax increase. I don't even want to think about what that would do to our already reeling economy. On the other hand, if either of these companies were allowed to simply fail, it would likely send the country into a full-blown depression. A pretty scary catch-22, if you ask me. Read here:

The Fannie and Freddie doomsday scenario - Jul. 9, 2008

Unfortunately, this is the nasty corner we have painted ourselves into. As hundreds of posters on this forum dream and plan of relocation, big houses, neat jobs, etc., etc., a wholesale economic execution has been set in motion for us. We are very likely at the point that our economic options will be akin to being asked if we would prefer being hung or shot. I am convinced we have long passed the point where a "soft landing" is in any way possible. Way too much stuff is completely dysfunctional, damaged, maladjusted, and catastrophically failing to keep this Good Ship Lollipop afloat in anything resembling its present form. Tens of millions are not going to financially survive what is coming in the US, and there will likely be more than a few than won't physically survive it, either--they won't have the will or they won't know how.

This economy is still trying to sputter along, but it's running on fumes, the tank is about dry, there's 200 miles of desert ahead and no gas station.

[brightdoglover]

I feel the same way, although don't have as many facts and figures as Jazzlover has shared with us. I'm just hunkering down here outside Boston. I have as steady a job as you can get- night float RN in an old and venerable hospital, one that already downsized in the 1990s and is now part of the "800-pound gorilla," a huge health consortium including Mass. General. I work nights, psychiatric, and float- three things no one wants. I have my little dream house in the woods 20 miles away with rescue mutts, and my job has an old-fashioned flush pension fund.
I saw a job (ONE job) in Durango when I visited last summer. Same work I do here, but it was the only job of its kind in Durango, a new psychiatric unit, and rather short money. All I could think of was, do I really want the only job for 300 miles around, and it's a new program? I looked at housing, and could barely have made it by selling here. Decided that Colorado will be for vacations, maybe extended stays, but I am not going to consider moving there.
Regarding the economy, this just doesn't seem like a good time for adventure. Hunkering down (no canned goods for a year, but I do notice that I grab the occasional overtime shift, on general principle).

[CosmicWizard]

This guy is not quite as pessimistic as some posters on this thread, but what does he know....he's only the richest person in the world! Obviously, with his big financial cushion he looks at things from a different perspective than most of us can muster. He also has MUCH more to lose than any of us do.

Warren Buffett is busy - Jul. 10, 2008

[Shuffler]

I bet there's more than a few land & homeowners in N Dakota who aren't too depressed these days. That's okay, when the work of the Pigmen is done, it will bust, probably. Good for these overnight millionaires, hopefully they are smart with their money...

[Mike from back east]

Originally Posted by NewAgeRedneck

This guy is not quite as pessimistic as some posters on this thread, but what does he know....he's only the richest person in the world! Obviously, with his big financial cushion he looks at things from a different perspective than most of us can muster. He also has MUCH more to lose than any of us do.

Warren Buffett is busy - Jul. 10, 2008

Buffet is a real cool dude, no flash, no hanky panky in the markets, just buys solid value and when the time is right, he pulls the trigger on deals. Buffet never invests in wacky concepts, if he can't understand the business model, then he stays away from it.

I'm watching Valero (VLO) who are below their 52-week LOW. They're the largest refiner we have, real assets, not fluff. Stocks of refiners go down as the crack spread (margin) goes down when crude prices rise. When crude falls, stocks of refiners should rise nicely. I'm surprised no one has taken them out, so it may be a good buy betting that someone with an eye for value will jump. Usually, P/B ratios of 3.0 or less catch the eye of value investors, for VLO it's 0.98 with a P/E of 4, indicating a screaming bargain. Like pumping for oil, it can take years to bring new refinery capacity on line, so I think VLO may be a real buy, for either appreciation or for a takeover with a major premium paid (like the Dow deal for Rohm & Haas).

Like the old stock market saying, "buy when there's blood in the street" and it seems these may be such times, especially for Fannie May and Freddie Mac, which are off hugely, and may be bloody bargains for those with the grit to invest and bet the Fed will NOT let them fail.

[Sockeye]

Well, the Dow dipped below 11000 for the first time in over 2 years today, amid more rumblings re: the Fannie Mae insolvency.

[Bob from down south]

Originally Posted by Mike from back east

Like the old stock market saying, "buy when there's blood in the street" and it seems these may be such times, especially for Fannie May and Freddie Mac, which are off hugely, and may be bloody bargains for those with the grit to invest and bet the Fed will NOT let them fail.

I think a better saying might be "never marry a person with end-stage cancer...there's no future in it." It may feel right at the time, but it's gonna end badly.

Even if the govt and the fed saves them, it's pretty likely their stockholders will still lose everything.