The Collected Works of Author and Blogger Larry Roberts

Archive for 2010

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]

We have been waiting almost 18 months for the government to allow housing prices to fall to their natural market-clearing levels. First, the Federal Reserve lowered interest rates and directly purchased mortgage-backed securities, then the federal government began providing tax incentives and credits to further prop up prices, even California got into the tax credit act. And for what? Prices are still going to fall. July Existing-Home Sales Fall as Expected but Prices Rise National Association of realtors -- Washington, August 24, 2010 Existing-home sales were sharply lower in July following expiration of the home buyer tax credit but home prices continued to gain, according to the National Association of realtors®. Notice how carefully the NAr spins this disastrous headline. First, they fail to mention that the…[READ MORE]

With election season gearing up, politicians are seeing what voter groups they can buy off. Apparently, the unemployed homedebtors are a significant voter block this time around. U.S. Plans More Aid for Jobless Homeowners By DAVID STREITFELD Published: August 11, 2010 In an acknowledgment that the foreclosure crisis is far from over, the Obama administration on Wednesday pumped $3 billion into programs intended to stop the unemployed from losing their homes. So what has he done to provide aid to unemployed renters? Unemployed loan owners already get to squat in relative comfort, eat three meals a day, and surround themselves with creature comforts whereas renters double up with friends or sleep in their cars. Yet, despite this obvious unfairness and disparity of…[READ MORE]

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