The Collected Works of Author and Blogger Larry Roberts

Archive for September, 2010

Some housing markets need a tourniquet to stop the profuse bleeding of home equity. In the most beaten down markets, prices have overshot fundamentals to the downside. In Monday's post I discussed Another Dumb Idea to Shift Private Mortgage Losses to Taxpayers. Today, I am going to look at a much better proposal for dealing with the reality of millions of foreclosures owned by the US government. GSEs to Lose Tens of Millions Lisa Marquis Jackson -- John Burns Real Estate Consulting August 28, 2010 While officials were gearing up for the August 17, 2010 meeting on GSE reform, the GSEs were losing millions of dollars every hour. Why? Because home prices are falling again. We have a solution. Recent…[READ MORE]

Bubble Blogs and Deflation Psychology The IHB has never been a bubble blog, but it is often labeled as such because I have been bearish on housing for so long. I am still bearish on Orange County, but I am very bullish on Las Vegas and many other beaten down markets. Someday, I may even be bullish on Orange County -- probably after all the bulls give up. Bubble blogs resonated with many people because they spoke a truth about greed and stupidity during a period of mass financial insanity. Prices were insane, and bubble bloggers said so. Once prices started to fall, bubble bloggers were heard by a wider audience and they fed into the cycle of deteriorating buyer confidence. Falling prices…[READ MORE]

Last week I wrote about The Upcoming Collapse of the Banking Cartel. In that post, I noted that as soon as the parties to the cartel begin to feel some urgency to liquidate their holdings that the cartel would crumble. The only thing sustaining prices are current levels is the limited availability of product. Once enough product hits the market in a salable form (short sales are still a very slow process), prices will begin to fall. Given how much effort and resources the government has put into market stabilization, it is surprising that the FDIC, the GSEs and the FHA are leading the movement to liquidate properties and bring down the banking cartel. FDIC sells another $760 million in REO…[READ MORE]

One housing bubble phenomenon was that the right ones -- prudent people who knew what they could afford -- were kept out, and the wrong ones -- kool aid intoxicated fools -- were let in. That mistake was bad enough, but now our own government is frantically working to repeat this mistake. Rather than doing something corrective, like letting house prices fall, our government is going to extreme lengths to keep the right ones out and keep the wrong ones in. Perhaps the administration is finally seeing the light, and in an amazing turn, they might actually let house prices fall. Grim Housing Choice: Help Today’s Owners or Future Ones By DAVID STREITFELD Published: September 5, 2010 The unexpectedly deep plunge in home sales this summer is likely…[READ MORE]

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