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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: patron_anejo_por_favor who wrote (197168)	4/20/2009 7:15:03 PM
From: Les H	Read Replies (2) \| Respond to of 306849

Everyone was certain that a housing bubble could be popped safely because the national median housing price had never gone down before. At least, that's what I was told back in an investment seminar in 2005 held by one of the WS firms. The Fed would safely prick the housing bubble and prop up median housing prices. The money would flow into stocks and they would go up 30% in 2 years. If anything went wrong, the Fed would save the day by cutting interest rates and rev up Ben's helicopter. Inflation and the stock market wealth effect would bail out residential housing. Looking back, they failed to consider the role of subprime lending in housing, the adverse effect of inflation on those borrowers, and the limited trickledown of the wealth effect in that sector...

To: patron_anejo_por_favor who wrote (197168)	4/20/2009 8:02:14 PM
From: Smiling Bob	Respond to of 306849

Yes, too much faith placed in BB tunnel vision. I wonder how many Joe Back Packs would love to knock his teeth out. Talk about nerve. I'm hearing stories every day of someone who is being laid off or knows someone who is being laid off. Telling these people they need to learn to shield their dwindling income borders on cruel. These lay-offs are not initiated as much from overcapacity and waste as they are from fear of top management being scorned for not protecting the bottom line in these uncertain and unstable times. They're mostly looking to protect their own overpaid positions and bonuses. It's the corporate belief the fastest way to cut costs is by slashing jobs. NO employee should have suddenly become a drag on the company. If they are only now seen as such, that's just a product of bad management and complacency in good times. A good company would have had the fat labeled and trimmed immediately, not just when things slow down.