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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (16186)	7/5/2004 5:01:32 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

Somewhat related to your open question, is a story in the 7/5 Barron's called "Secrets of the Vault", describing how financial institutions are making "insider" loans to their officers. Hopefully someone can post the piece. I think this is just another unsung aspect (that you can add to foreign money laundering) Message 20227093 of the real estate bubble, and here's an anecdote that describes it. There is a large empty house across the street in my coastal Oregon neighborhood. It was purchased for about 750k by an individual from Salem, who is a lending officer for a bank I won't name. Naturally, the loan came from this bank. The house stands empty, shades drawn, with no furniture inside. The buyers haven't spent one day in it. In theory I bet I could just move in with sparse accommodations, and no one would know the difference (as 90% of the housing here is also empty at any point in time), as long as I was careful to "put the toilet seat down." The scuttlebutt, is that they will occupy in "a couple years". I can only call this pure unadulterated speculation of the worst kind: fully supported by lax underwriting standards, rather sleazy sweetheart deals, and easy money. I just returned from Whistler, BC, and houses stand largely empty there too.