tag:blogger.com,1999:blog-8515247115132134144.post8046120408247302682..comments2024-02-17T12:34:01.400-08:00Comments on Illusion of Prosperity: "There's No Housing Bubble to Go Bust"Stagflationary Markhttp://www.blogger.com/profile/04568993350246477976noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-8515247115132134144.post-16295108791030483722012-09-24T17:52:13.792-07:002012-09-24T17:52:13.792-07:00Troy,
The Fed has immense powers to change financ...Troy,<br /><br /><i>The Fed has immense powers to change financial realities.</i><br /><br /><a href="http://www.despair.com/government.html" rel="nofollow">Despair.com: Government</a><br /><br /><i>QE3 is not necessarily small beer, but what it's going to do for J6P remains to be seen.</i><br /><br /><a href="http://www.despair.com/inflation.html" rel="nofollow">Despair.com: Inflation</a><br /><br />In all seriousness, I'll believe the Fed will fix our problems when the Fed manages to pump cheap oil.<br /><br />I say this because J6P and the wife of J6P were convinced by the powers that be that a long commute from suburbia in two single-occupancy vehicles would not be a problem (as long as oil remained cheap and neither lost their jobs).Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-57053842654385626602012-09-24T17:24:33.134-07:002012-09-24T17:24:33.134-07:00The Fed has immense powers to change financial rea...The Fed has immense powers to change financial realities.<br /><br />QE3 is not necessarily small beer, but what it's going to do for J6P remains to be seen.<br /><br />We're hitting a demographic squeeze here as the nation's housing stock has to handle the BB plus Gens X & Y, as Y starts turning 30 en-masse.<br /><br />This is bullish for rents! But rents are just wealth transfer from the 95% to the 5%, so that's not particularly bullish for J6P.<br /><br />As rents go up, and mortgage rates go down, that will give a tailwind for home valuations, too.<br /><br />But that this nation thinks rising housing costs are a net good just means we belong in a booby hatch.Troynoreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-50261498149237302012-09-24T16:52:44.985-07:002012-09-24T16:52:44.985-07:00Troy,
Here's how I see it.
I don't blame...Troy,<br /><br />Here's how I see it.<br /><br />I don't blame Bernanke any more than I would blame a bad astrologer.<br /><br />That said, I don't expect Bernanke to fix our long-term structural problems any better than I would expect a bad astrologer to fix them, lol. Sigh.<br /><br /><a href="http://illusionofprosperity.blogspot.com/2010/11/sarcasm-report-v69.html" rel="nofollow">Genius!</a>Stagflationary Markhttps://www.blogger.com/profile/04568993350246477976noreply@blogger.comtag:blogger.com,1999:blog-8515247115132134144.post-10399793925293723172012-09-24T14:49:37.097-07:002012-09-24T14:49:37.097-07:00"and the number of new households"
beca..."and the number of new households"<br /><br />because people create tradable wealth from the aether!<br /><br />Casey Serin hadn't scuttled into the public eye until a year later, but in mid-2005 I was talking with my high school buds and I had by then understood the part about the banks securitizing their loans (and thus not caring about loan quality) enough to explain that part of the puzzle to them.<br /><br /><a href="http://research.stlouisfed.org/fred2/graph/?g=b0F" rel="nofollow">http://research.stlouisfed.org/fred2/graph/?g=b0F</a><br /><br />is the virtuous circle that was apparent to the Federal reserve -- quarterly payroll growth (blue) vs. quarterly mortgage debt growth (red).<br /><br />By late 2005 we were borrowing $100B/month to keep the bubble going (prices had peaked 1H05, but everyone was hoping for one more bite of the appreciation pie).<br /><br /><a href="http://research.stlouisfed.org/fred2/series/USCSCOMHPISA" rel="nofollow">http://research.stlouisfed.org/fred2/series/USCSCOMHPISA</a><br /><br />+$100B/month for +250,000/mo in new jobs. Of course, this $100B/mo wasn't just supporting new jobs, it had to support ALL the jobs added since the dotcom crash -- 5 million (that's $20,000 per job per month -- not bad!)<br /><br />Now, I don't particularly blame Bernanke here. If I were he in 2005 what would I have done . . . being honest would result in a spectacular market crash, 10X worse than the 1987 one (kinda like 2H08 I guess, LOL).<br /><br />Man.<br />Troynoreply@blogger.com