Comments on: Hold or Fold – a single example of the madness of the US housing market http://unconditional.co.nz/blog/hold-or-fold-a-single-example-of-the-madness-of-the-us-housing-market/ What's really going on in realestate Fri, 30 Jul 2010 23:31:49 +1200 http://wordpress.org/?v=2.8.4 hourly 1 By: Estate Agents Christchurch http://unconditional.co.nz/blog/hold-or-fold-a-single-example-of-the-madness-of-the-us-housing-market/comment-page-1/#comment-2604 Estate Agents Christchurch Thu, 22 Oct 2009 16:03:39 +0000 http://www.unconditional.co.nz/blog/?p=4129#comment-2604 Wow! Very interesting topic you have here. It's a dilemma for the people who bought property at Merced. Wow! Very interesting topic you have here. It’s a dilemma for the people who bought property at Merced.

]]> By: Steve Koerber http://unconditional.co.nz/blog/hold-or-fold-a-single-example-of-the-madness-of-the-us-housing-market/comment-page-1/#comment-2070 Steve Koerber Sun, 11 Oct 2009 06:52:50 +0000 http://www.unconditional.co.nz/blog/?p=4129#comment-2070 Another interesting twist. Fannie Mae is insolvent. I read their latest financial report on their website. It blatantly admits they should not be operating. Their own report states that they can only hope to continue operating as a company if the US Treasury continues to inject funds. The last injection was around $10 billion for about 6 months life. They're using the TARP bailout funds. The Govt is just pumping money into these organisations hoping that the housing market will turn around. If it doesn't they're toast. What hope do they have if they're lending on 3.5% deposits to people who've already declared bankruptcy and can't demonstrate an ability to repay? Where does it all end? Another interesting twist. Fannie Mae is insolvent. I read their latest financial report on their website. It blatantly admits they should not be operating. Their own report states that they can only hope to continue operating as a company if the US Treasury continues to inject funds. The last injection was around $10 billion for about 6 months life. They’re using the TARP bailout funds. The Govt is just pumping money into these organisations hoping that the housing market will turn around. If it doesn’t they’re toast. What hope do they have if they’re lending on 3.5% deposits to people who’ve already declared bankruptcy and can’t demonstrate an ability to repay? Where does it all end?

]]> By: Steve Koerber http://unconditional.co.nz/blog/hold-or-fold-a-single-example-of-the-madness-of-the-us-housing-market/comment-page-1/#comment-2071 Steve Koerber Sat, 10 Oct 2009 08:53:36 +0000 http://www.unconditional.co.nz/blog/?p=4129#comment-2071 Correction to my comment above, the FHA is not a lender but insurer of the loans. It's insuring loans with 3.5% deposits. Probably most of those loans are being made by Fannie and Freddie, both Govt institutions (pseudo banks) now. Where's the money coming from? I'd say the printing presses. Correction to my comment above, the FHA is not a lender but insurer of the loans. It’s insuring loans with 3.5% deposits. Probably most of those loans are being made by Fannie and Freddie, both Govt institutions (pseudo banks) now. Where’s the money coming from? I’d say the printing presses.

]]> By: Steve Koerber http://unconditional.co.nz/blog/hold-or-fold-a-single-example-of-the-madness-of-the-us-housing-market/comment-page-1/#comment-2073 Steve Koerber Sat, 10 Oct 2009 08:41:46 +0000 http://www.unconditional.co.nz/blog/?p=4129#comment-2073 The US market is a disaster zone for sure. It's actually beyond ridiculous... This New York Times Story http://www.nytimes.com/2009/10/09/business/09fha.html?_r=2&ref=business published yesterday shows how the US hasn't learnt the lessons they needed to. It seems absurd that private banks won't lend unless the borrower has 20% deposit, yet the FHA, a Govt agency that may soon implode & now has reserves below their allowed congressional minimum, is lending $1billion per day (yes per day!) to people with only 3.5% deposit. A borrower profiled in the story had this to say: “The government,” she said, “is doing what it needed to do — taking a risk on people.” Green shoots - yeah right!! The US market is a disaster zone for sure. It’s actually beyond ridiculous…

This New York Times Story http://www.nytimes.com/2009/10/09/business/09fha.html?_r=2&ref=business

published yesterday shows how the US hasn’t learnt the lessons they needed to. It seems absurd that private banks won’t lend unless the borrower has 20% deposit, yet the FHA, a Govt agency that may soon implode & now has reserves below their allowed congressional minimum, is lending $1billion per day (yes per day!) to people with only 3.5% deposit.

A borrower profiled in the story had this to say:
“The government,” she said, “is doing what it needed to do — taking a risk on people.”

Green shoots – yeah right!!

]]> By: Alistair Helm http://unconditional.co.nz/blog/hold-or-fold-a-single-example-of-the-madness-of-the-us-housing-market/comment-page-1/#comment-2074 Alistair Helm Fri, 09 Oct 2009 23:12:27 +0000 http://www.unconditional.co.nz/blog/?p=4129#comment-2074 Ross Thanks for the additional content contribution - wiki-like post this! Ross

Thanks for the additional content contribution – wiki-like post this!

]]> By: Ross Brader AREINZ http://unconditional.co.nz/blog/hold-or-fold-a-single-example-of-the-madness-of-the-us-housing-market/comment-page-1/#comment-2075 Ross Brader AREINZ Fri, 09 Oct 2009 21:51:43 +0000 http://www.unconditional.co.nz/blog/?p=4129#comment-2075 If the median is only US $144,000 - what would these be worth? http://tinyurl.com/yhf8cqy Much of the town appears to be trailer park type housing. If the median is only US $144,000 – what would these be worth? http://tinyurl.com/yhf8cqy

Much of the town appears to be trailer park type housing.

]]> By: Ross Brader AREINZ http://unconditional.co.nz/blog/hold-or-fold-a-single-example-of-the-madness-of-the-us-housing-market/comment-page-1/#comment-2069 Ross Brader AREINZ Fri, 09 Oct 2009 21:42:28 +0000 http://www.unconditional.co.nz/blog/?p=4129#comment-2069 Amazing to look at the satellite photo of Merced where you can zoom right in and see all the unfinished subdivisions. I note that it is directly in line of on the flight path of an airforce base a few kms to the north! Using street view you can actually "drive around the town of Merced even the abandoned empty streets have been photographed! See http://tinyurl.com/yfpd4sq Amazing to look at the satellite photo of Merced where you can zoom right in and see all the unfinished subdivisions.

I note that it is directly in line of on the flight path of an airforce base a few kms to the north!

Using street view you can actually “drive around the town of Merced even the abandoned empty streets have been photographed! See http://tinyurl.com/yfpd4sq

]]> By: Steve Koerber http://unconditional.co.nz/blog/hold-or-fold-a-single-example-of-the-madness-of-the-us-housing-market/comment-page-1/#comment-2072 Steve Koerber Fri, 09 Oct 2009 01:08:33 +0000 http://www.unconditional.co.nz/blog/?p=4129#comment-2072 Wow Alistair, scary stuff indeed! I'm currently listening to the audio version of the all time classic "The richest man in Babylon". Amongst other pearls here are a few: 1. Gold cometh gladly and in increasing quantity to any man who will put by not less than one-tenth of his earnings to create an estate for his future and that of his family. 2. Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multiplying even as the flocks of the field. 3. Gold clingeth to the protection of the cautious owner who invests it under the advice of men wise in its handling. 4. Gold slippeth away from the man who invests it in businesses or purposes with which he is not familiar or which are not approved by those skilled in its keep. 5. Gold flees the man who would force it to impossible earning or who followeth the alluring advice of tricksters and schemers or who trusts it to his own inexperience and romantic desires in investment. Chapter summary here for anyone interested: http://en.wikipedia.org/wiki/The_Richest_Man_in_Babylon_(book)#Chapter_Summary Wow Alistair, scary stuff indeed!

I’m currently listening to the audio version of the all time classic “The richest man in Babylon”. Amongst other pearls here are a few:

1. Gold cometh gladly and in increasing quantity to any man who will put by not less than one-tenth of his earnings to create an estate for his future and that of his family.
2. Gold laboreth diligently and contentedly for the wise owner who finds for it profitable employment, multiplying even as the flocks of the field.
3. Gold clingeth to the protection of the cautious owner who invests it under the advice of men wise in its handling.
4. Gold slippeth away from the man who invests it in businesses or purposes with which he is not familiar or which are not approved by those skilled in its keep.
5. Gold flees the man who would force it to impossible earning or who followeth the alluring advice of tricksters and schemers or who trusts it to his own inexperience and romantic desires in investment.

Chapter summary here for anyone interested:
http://en.wikipedia.org/wiki/The_Richest_Man_in_Babylon_(book)#Chapter_Summary

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