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

To: Keith Feral who wrote (90727)	1/22/2008 1:28:08 PM
From: Pogeu Mahone	Respond to of 110194

Where are these buyers going to come up with 20% down? ============ Maybe we can get a decent Spring housing market since people won't have to wait around til 2009 for good mortgage rates.

To: Keith Feral who wrote (90727)	1/22/2008 3:15:14 PM
From: bart13	Read Replies (1) \| Respond to of 110194

"The Chairman noted that the President had recently signed the Financial Services Regulatory Relief Act of 2006, which among its provisions gave the Federal Reserve discretion, beginning October 2011, both to pay interest on reserve balances and to reduce further or eliminate reserve requirements. The Act potentially has important implications for many aspects of the Federal Reserve's operations" federalreserve.gov

To: Keith Feral who wrote (90727)	1/22/2008 3:26:23 PM
From: andiron	Respond to of 110194

US housing asset ~20 tril (now ~18 tril) must come down to 12-13 tril to have any realsitic chance of a real estate revival// Global credit bubble has burst. Lowering the rates do not solve the problema...

To: Keith Feral who wrote (90727)	1/22/2008 4:25:05 PM
From: ggersh	Respond to of 110194

Take the needle out of your arm...aint any of that going to happen...IMHO

To: Keith Feral who wrote (90727)	1/26/2008 10:58:47 PM
From: glenn_a	Read Replies (1) \| Respond to of 110194

Keith. ((The FED has inspired almost every economic calamity by overtightening monetary policy to the point where people can't pay their mortgages. This is the problem with FED policy. To fight higher oil prices, they are jacking up mortgage rates so that no one can afford to pay their mortgage. That is insane!!)) Hang on here. What about the credit expansion that led to the prices rising in the first place? Is this not a more fundamental disease than how the Fed treats the symptoms once the patient is terminally ill. See Doug Noland's Credit Bubble Bulletin piece this weekend: "More than Twenty Years in the Making": prudentbear.com Not saying Noland is always predicts the correct outcome, but I certainly agree with his diagnosis of the problem. g

To: Keith Feral who wrote (90727)	1/27/2008 1:32:33 PM
From: Rarebird	Read Replies (2) \| Respond to of 110194

<<They need to keep interest rates around 2.5% to 3.0% so that people can get used to a stable housing environment for the next 3 to 5 years.>> Back in August 2007, you raised a very good question: "Credit problems are set when people stop lending the money. The only question is why the banks stopped lending the money." Message 23833223 I responded by saying: "Many Multi-national corporations are becoming affected by this "massive event, suffering from late payments from their customers and having difficulties making payments themselves as a consequence. They are forced to seek short-term finance in order to make such payments. The situation is quite serious." siliconinvestor.com The Fed will not be able to save the day by lowering rates here because the issue is not the cost of credit but it's availabiity. Yes, I know the refi. gig is back in play. However, the people who desperately need to borrow will not be able to borrow, while others who don't need to borrow and have no interest in doing so, will possibly be able to borrow all they like. The windfall here will be minimal at best. My position has not changed since August 2007: "The real problem is that entire edifice of US economic growth has been built on the quicksand of bank lending unrestricted by any notion of risk or of any limit to the ability of the lender to service or repay the debt. The time will eventually come when the borrowers are afraid to borrow and the lenders are afraid to lend." Message 23832256 This is very somber: Economist Scott Anderson of Wells Fargo recently said: "Large money-center banks have virtually frozen their balance sheets, reluctant to lend even to good credit." If you give me some of that "Kool-Aid" you are drinking, I might tell you in a giddy moment that the S@P 500 may be able to get away with only a 30% bear market decline here. But don't bank on it. The risk is for a much steeper decline with every perceived safe haven getting mauled before this bear market is over.

To: Keith Feral who wrote (90727)	1/27/2008 10:55:23 PM
From: Proud Deplorable	Read Replies (1) \| Respond to of 110194

"Maybe we can get a decent Spring housing market since people won't have to wait around til 2009 for good mortgage rates" Unlikely, desperation hasn't set in followed by total capitulation. Many are still between denial stage and the panic stage. But remember this, a bull market is not born until there is total capitulation so while there may be some bright flickers they can't last long. These cycles run about 7 years so if the bear started 2 years ago there is a long way to go yet. A couple of years of depression and despondancy is in the cards. When everyone you talk to thinks real estate is a dirty word then there is hope