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

To: russwinter who wrote (35937)	7/13/2005 9:20:09 PM
From: piggington	Read Replies (4) \| Respond to of 110194

I agree with everything you are saying, in terms of the future problems... I am just unconvinced that it is happening quite yet. I think the vast majority that 15k or so inventory is people who WANT to take profits or to move up, not people who have been forced via ARM resets into selling. Do you think a lot of people (enough to move the market) are currently in that boat? rich

To: russwinter who wrote (35937)	7/14/2005 7:06:59 AM
From: Wyätt Gwyön	Read Replies (2) \| Respond to of 110194

from that NYT article you mention: This year's fashionable model, known as an "option ARM," allows borrowers to make payments with monthly rates starting as low as 1.25 percent for the first five years of the loan; on the one hand you are saying teaser rates are dead, but OTOH this article says you can have 1.25% interest for 5 years. is this true, or is it a typo by NYT? if so, then a $1 million mortgage would barely cost $1000 a month for five years, not to mention less with negative amortization. by this logic, one might even say California houses are underpriced. another question: with a negative amortization loan, is the negam cap tied to current market value? if market values fall, can the negam feature go away (because your LTV would end up being too high)?