Bias change aint enough. AG already gave us that in his speech a couple of weeks ago. 1/4 cut will give a signal that fed is deploying airbags to keep landing soft. It will be a psychological gambit if it occurs. He has to convince the anti inflation group on the fed that this the right course. He can use this post from the intel thread to help convince them.
To: Tushar Patel who wrote (122921)
From: Amy J
Friday, Dec 15, 2000 6:48 AM ET
Reply # of 122948
Hi Tushar and Thread, RE: "The speed of the slowdown is amazing...here in San Francisco...office space...dot com
closedowns. ...rents $60-$80 in May are now down to around $30-$60. Vacant office space has gone up over 50%"
--------------------------------
The slowdown in office space isn't too surprising when you consider that BA real estate increased about 40%/yr
between April-99 to April-00 [SJMN, 2000].
And rentals were up YTD about 40% (or 45%?) around July-00 from Jan-00 per an article in the SJMN around
July-00.
So, a 50% drop is only about a year's worth of retraction.
How would you like to hear about a 31% drop in 2 weeks?
A contact of a contact was seeking a house about two weeks ago in Silicon Valley. Fortunately, they didn't buy the
house they were looking at, because today, only two weeks later, the price of the house is 31% lower. A drop was
'just previously' unheard of in Silicon Valley.
Only a few months ago, homes received so many offers and had so many buyers, that it was the norm for bidding
wars to bid up any house price at least 10% over the (already-outrageous) asking price. A home would be snatched
up in one day and sometimes as fast as one hour.
However, now it's different: homes that are still using yesterday's prices (i.e. October time frame) aren't being
snatched up like they were before, and a drop in housing price was completely unheard of during the great Internet
boom.
Another contact told me he saw "for rent signs" on his jogging route for the first time.
Another contact told me that his office property (in the heart of Silicon Valley) has a "for rent sign" up - the first time
ever since 1996. Wow.
Another contact told me that a contact of his foolishly spent an outrageous amount of money on his daughter's
wedding. However, now his contact has a total networth that is now less than his daughter's wedding because his biz
(probably a dotcom) suddenly went downhill.
You can see the slow-down at the online stores of traditional retailers: these folks are offering less of a selection than
last year. Online gift shopping isn't as good as last year because the selections are more limited in their effort to cut
back.
Regards,
Amy J |
