Real Estate Market / Inflation / Recession / Depression (Denver, Aurora: mortgage, credit, loans)

[sterlinggirl]

Points, percent, what's the difference?

[multitrak]

Originally Posted by Charles

What? No way.

i performed the calculation using mini s&p500 dec 07 and jun 08 futures contracts: high=1586.75 on 10/11/07, low=1253.00 on 03/17/08, high-low = 333.75, fri close = 1371.75, fri close-low = 118.75/333.75 = .36 or 36% higher than the mar 17 low. two important resistance levels that traders will look at are high-low price retracements at 38.2%=1380.50 (fri high=1388.00) and 50%=1420.00 from the low at 1253.00.

[Charles]

Originally Posted by sterlinggirl

Points, percent, what's the difference?

Thirty five points on an index sitting at 1400 is about 2.5%. Thirty five percent of 1400 is about 490 points.

[Bob from down south]

Originally Posted by multitrak

the s&p500 is UP nearly 35% from its march bottom and the "bad" news (wall of worry) just keeps rolling in...sounds positive for stocks in general to me! a fact of business life is that management hiring and firing decisions are usually inverted to the business cycle: they tend to expand near cycle tops and contract near cycle bottoms...i know it's true for the oil business and i can't see why aerospace would be any different. instead of lowering your job expectations, look into consulting part time if you settle in cos. people with your experience will be badly needed when the aerospace cycle moves up again...

Up 35%? What Charles said. No way.

There are cycles other than the short term business cycle that we're all familiar and/or comfortable with. A guy named Nikolai Kondratiev postulated about a long-term economic cycle, too. Recommend the cycle buffs do some reading on that one. We're too quick to assume that this is just another replay of something we've seen before.

This time we've got the magnifying effects of excess leverage amplifying the shock wave. I don't think this will prove to be something we've seen before...and I think we will be talking about it for the rest of our lives.

The stock market bounce looks like a classic bear market rally to me. There are no reasonable fundamentals that justify its recent moves up...in fact some of the biggest upward movers on Tuesday's 400 point rocketshot were financials and homebuilders--the stuff with the worst prospects of all. That leads me to chalk it up to unwinding of positions by hedge funds that can't hang at 50 or 70 to 1 anymore...and it explains gold and other commodities dropping at the same time. I think one or more hedgies probably had to sell off some of their commodities to fund short covering to meet margin calls. It's squeezing out a lot of short sellers, and putting a pocket or thin air under the market at levels where the shorts would normally be hanging around waiting to buy. That means risk of a big slide down with little to stop it once it gets going.

Take a look at the Dow in the month before the Oct 1929 crash. Lots of big swings up and down on a percentage basis.

[sterlinggirl]

Originally Posted by Charles

Thirty five points on an index sitting at 1400 is about 2.5%. Thirty five percent of 1400 is about 490 points.

Thanks for clearing that up for me Charles

[multitrak]

Originally Posted by Charles

Thirty five points on an index sitting at 1400 is about 2.5%. Thirty five percent of 1400 is about 490 points.

i'm looking at the high-low (334 pts) retracement off the bottom or 36% up from the 3/17 low.

[Bob from down south]

Here's a USA Today article from earlier in the week about mass foreclosures in Denver.

Mortgage defaults force Denver exodus - USATODAY.com

[multitrak]

Originally Posted by Bob from down south

The stock market bounce looks like a classic bear market rally to me.

otoh, some bear market rallies have retraced more than 100% of their high-low range. fundamentals and news are usually crap at market bottoms, so that doesn't mean a whole lot. better to look at market breadth, ie, up/down issues and up/down volume...bear market rallies usually have poor breadth, but then again, so did the bull rally off the 1987 low.

[jazzlover]

Originally Posted by Bob from down south

Up 35%? What Charles said. No way.

There are cycles other than the short term business cycle that we're all familiar and/or comfortable with. A guy named Nikolai Kondratiev postulated about a long-term economic cycle, too. Recommend the cycle buffs do some reading on that one. We're too quick to assume that this is just another replay of something we've seen before.

This time we've got the magnifying effects of excess leverage amplifying the shock wave. I don't think this will prove to be something we've seen before...and I think we will be talking about it for the rest of our lives.

The bounce last week didn't surprise me, either. After all, the Fed is pouring liquidity into the markets--some of it would wind up chasing stocks. The problem is that does not change the deteriorating fundamentals behind what I believe will be the coming wreck: borrowers are still overextended, the speculative bubble still has a long way to deflate, government debt and deficits are out-of-control and getting worse. Worst of all, the US economy has gone from a productive and resource-plentiful economy to a less-and-less truly productive and more and more resource-scarce economy ever more dependent on imports (and outside capital) to sustain itself. To those who say that the declining dollar will stimulate exports (and reduce imports), I note that assumes that Americans actually have a choice to purchase American-made products instead of importing them. For a huge list of both necessities and luxuries (oil, electronics, appliances, etc., etc.), Americans increasingly no longer have that option. They will have to pay the inflated price for an imported product or go without.

We have painted ourselves into one hell of a corner in the last 10-20 years, and Americans are now going to pay the price for that folly. Whatever goofball opined the phrase in the 1960's that so many Americans have embraced, "You can have it all, baby," ought to be taken out and shot. That kind of wanton living, with no regard to the future (and some posters on this very thread still espouse it), has pushed this country to the very brink of its economic survival and may threaten its political survival before it's done. This tragic play is just in its opening act. And Colorado will likely be at center stage for some of the pain.

[multitrak]

Originally Posted by Bob from down south

Here's a USA Today article from earlier in the week about mass foreclosures in Denver.

this denver housing chart Paper Economy - A Real Estate Bubble Blog breaks out the various market segments: the high end market is holding up well (as reported by custom home builders on this forum) while the middle market and especially the low end market (the subject of the news piece) are getting hit harder. i'm curious what the current bankruptcy rate is in denver given all those reported foreclosures. are things really that bad in the green valley ranch neighborhood? or is this another case of piling on bad news long after the fact? the article makes it sound like last one out of denver, please turn out the lights...