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The Mysterious New Housing Bubble


By Bob Jones   Follow   Wed, 19 Dec 2012, 2:53pm PST   2,841 views   27 comments   Watch (1)   Share   Quote   Permalink   Like (2)   Dislike  

http://www.counterpunch.org/2012/12/18/the-mysterious-new-housing-bubble/

The rebound in housing is now in full swing. Housing starts are up, existing home sales are gaining pace, inventory is down, and prices are on the rise. According to a recent report by Corelogic “House prices are up 6.3% year-over-year in October, the largest increase since 2006 and the eighth consecutive increase in home prices nationally on a year-over-year basis.” Many experts are now predicting that 2013 will be even better, in fact, J.P. Morgan thinks that prices could gain another 10 percent in the next 12 months. Here’s the story from the Wall Street Journal:

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monkframe   befriend   ignore   Mon, 24 Dec 2012, 12:59am PST   Share   Quote   Like (2)   Dislike     Comment 1

Excellent article. I've been wondering what's behind the obviously coordinated propaganda campaign seeking to reassure the public that the housing market is "coming back."

The Professor   befriend   ignore   Mon, 24 Dec 2012, 1:37am PST   Share   Quote   Like (3)   Dislike     Comment 2

The fed is producing a HUGE amount of money. This money is trickling down to a select few who are using it to buy up REAL property with fiat paper enriching the owner class while further impoverishing the working class.

Kevin   befriend   ignore   Mon, 24 Dec 2012, 4:37am PST   Share   Quote   Like (4)   Dislike     Comment 3

monkframe says

Excellent article. I've been wondering what's behind the obviously coordinated propaganda campaign seeking to reassure the public that the housing market is "coming back."

There is no "coordinated propaganda campaign", except maybe in your head.

What we have right now are artificially low interest rates, courtesy of the fed. This is what's driving housing at present. You can borrow nearly twice as much today as you could have 4 years ago for the same payment.

This is intentional. It's the policy. It's what the fed wants to happen. The alternative was to let homeowners sit underwater for years, thus preventing move-up buying and generally keeping trillions of dollars per year out of the economy.

You can debate the approach all you want, but to pretend that there's something sneaky or dishonest going on is pure bullshit. What's happening is exactly what Bernanke said he wants to happen and what he got the blessing of the white house, treasury, and congress to do.

Mark D   befriend   ignore   Mon, 24 Dec 2012, 7:07am PST   Share   Quote   Like   Dislike     Comment 4

E-man says

How can it be mysterious when everyone knows about it?

"mysterious" is subjective... etc. etc.

Kevin   befriend   ignore   Mon, 24 Dec 2012, 8:55am PST   Share   Quote   Like (3)   Dislike     Comment 5

Yeah, if somebody is a total moron, everything seems mysterious.

bmwman91   befriend   ignore   Mon, 24 Dec 2012, 11:39am PST   Share   Quote   Like (4)   Dislike     Comment 6

Although I don't want to encourage someone's condescending attitude, I have to agree that there is nothing mysterious going on. What we are seeing is a result of openly-stated policy. The media DOES cheerlead overpriced RE both because they make a shit ton of money on RE ads, and because 60%+ of America "owns" RE and love to hear feel-good BS about how they are growing their paper wealth.

Kevin   befriend   ignore   Mon, 24 Dec 2012, 1:51pm PST   Share   Quote   Like (1)   Dislike     Comment 7

I think you give the media too much credit. They don't want to offend advertisers, but they don't really think too much about them.

What "they" (by which I mean mainstream, televised / printed news sources) do do, however, is draw really basic conclusions.

House prices down from peak, interest rates very low? Looks like a good time to buy a house.

Expecting the same organization that spends most of the day talking about Kidnapped Little White Girl to do a really thorough, thoughtful investigation into the real estate market is futile.

bmwman91   befriend   ignore   Mon, 24 Dec 2012, 4:24pm PST   Share   Quote   Like   Dislike     Comment 8

True. TV "news" is nothing more than infotainment. Most people want to hear that housing is "good" because most people are paying on a loan for one. TV stations gotta show what sells.

The Professor   befriend   ignore   Mon, 24 Dec 2012, 10:54pm PST   Share   Quote   Like   Dislike     Comment 9

The mass of people that don't own are paying rents that are higher than the mortgage on their home would have been. Rent is rising and wages are stagnating. Good paying jobs are being replaced by low paying jobs.

Hoping for peace on earth and good will to all mankind. Merry Christmas.

everything   befriend   ignore   Tue, 25 Dec 2012, 4:57am PST   Share   Quote   Like   Dislike     Comment 10

I understand the fed giving money to investors to buy/bid up the market and take it for their own. With more RE owned by heavier hands it will be a stronger/stable market. With another good bout of inflation more will be priced out for life. Still, a renters society is not bad, our national debt is basically rented, it's just the way things work out in the capitalistic societies where only certain classes (those with access to piles of money), are allowed to buy now and pay later, yet also force the lower/middle classes to absorb all the costs associated with renting/borrowing the money.

taxee   befriend   ignore   Tue, 25 Dec 2012, 6:03am PST   Share   Quote   Like (1)   Dislike (1)     Comment 11

Let's get some naive, eager, twenty somethings to sign up for thirty years of servitude and we can call it an economy. Worked on the last bunch.

bmwman91   befriend   ignore   Tue, 25 Dec 2012, 7:59am PST   Share   Quote   Like (1)   Dislike     Comment 12

taxee says

Let's get some naive, eager, twenty somethings to sign up for thirty years of servitude and we can call it an economy.

Nope, they have a MUCH more solid demographic piling cash into it all now. The investor class has cash and they are pumping it in as fast as they possibly can. Once they own it all, they can extract rent from the people without limits. Just wait until Wall Street lobbyists push all renter-protection laws out of the books and replace them with legal indentured servitude. Welcome back to the 1920's folks.

taxee   befriend   ignore   Tue, 25 Dec 2012, 12:43pm PST   Share   Quote   Like   Dislike     Comment 13

bmwman91 says

Let's get some naive, eager, twenty somethings to sign up for thirty years of servitude and we can call it an economy.

Nope, they have a MUCH more solid demographic piling cash into it all now. The investor class has cash and they are pumping it in as fast as they possibly can. Once they own it all, they can extract rent from the people without limits. Just wait until Wall Street lobbyists push all renter-protection laws out of the books and replace them with legal indentured servitude. Welcome back to the 1920's folks.

Is the insurance fraud game over already? I thought they had just perfected it.

rfsanders   befriend   ignore   Wed, 2 Jan 2013, 2:15am PST   Share   Quote   Like   Dislike     Comment 14

bmwman91 says

True. TV "news" is nothing more than infotainment. Most people want to hear that housing is "good" because most people are paying on a loan for one. TV stations gotta show what sells.

I worked in TV news for a couple years. Here's what it is: A bunch of 22-year-old college grads who want to be the TV anchor, but instead work for $11/hour with no benefits -- churning out crappy scripts, working horrible hours, and missing Christmas -- until they can't take it anymore, and quit to take a "real" job.

The only reason station owners hire 6-figure anchors (and it's usually very LOW 6-figures) is to maintain the illusion of credibility. There was a time 20-years ago when local TV news had serious newsrooms. Today it's just interns and underpaid, abused college grads churning out scripts -- chasing the rainbow. Quit? No worries. There's a million more college grads who want a shot at the scam.

Newspapers are little better. Cable news might be able to hire a few more high-end producers, but it's not to enlighten --- it's to enslave. How can we attract the eyeballs to the screen just a little bit longer than CNN?

If you aren't paying for the product, you ARE the product. Nearly ALL media in the United States isn't about you --- it's about SELLING you. And that's why I can't trust anything I read, view, or hear. And I WORK in the business.

Don't trust news re: housing. Okay, end of rant. Back to housing.

bmwman91   befriend   ignore   Wed, 2 Jan 2013, 2:34am PST   Share   Quote   Like   Dislike     Comment 15

rfsanders says

If you aren't paying for the product, you ARE the product.

Thanks for the post. This has to be the single best summation of TV.

Ironman   befriend   ignore   Wed, 2 Jan 2013, 2:41am PST   Share   Quote   Like   Dislike (1)     Comment 16

bmwman91 says

Thanks for the post. This has to be the single best summation of TV.

Not only TV, and newspapers, internet, facebook, radio, and every other media source, etc......

bmwman91   befriend   ignore   Wed, 2 Jan 2013, 2:54am PST   Share   Quote   Like   Dislike     Comment 17

Call it Crazy says

bmwman91 says

Thanks for the post. This has to be the single best summation of TV.

Not only TV, and newspapers, internet, facebook, radio, and every other media source, etc......

Indeed. This definitely reaffirms my decision to not own a TV (haven't watched it on any sort of regular basis since I was

monkframe   befriend   ignore   Thu, 3 Jan 2013, 2:08pm PST   Share   Quote   Like   Dislike     Comment 18

"There is no "coordinated propaganda campaign", except maybe in your head."

That is followed by your analysis of the background of a coordinated campaign to pump up the housing market. Maybe it will work. Maybe not. I hope for the best, but I don't expect human behavior to conform.

JodyChunder   befriend   ignore   Thu, 3 Jan 2013, 3:48pm PST   Share   Quote   Like   Dislike     Comment 19

Kevin says

The alternative was to let homeowners sit underwater for years, thus preventing move-up buying and generally keeping trillions of dollars per year out of the economy.

Nah. Some better alternatives might have included: mortgage modifications, including second lien reductions/cancellations or forcing the banks to agree to and expedite more short sales.

At this rate, most homeowners -- at least ones who purchased between 2000-2007 -- are still going to be sitting/squatting underwater for many years to come.

JodyChunder   befriend   ignore   Thu, 3 Jan 2013, 3:52pm PST   Share   Quote   Like (1)   Dislike     Comment 20

bmwman91 says

Indeed. This definitely reaffirms my decision to not own a TV (haven't watched it on any sort of regular basis since I was

The suspense is bugging me..."since I was..." what?? Since you were what?!!!

It's okay to not own a TV, but you don't actually want to be one of those guys who mentions it too often. I know you know the type. Like my son in Washington, who thinks he's so cool and tweedy because he doesn't own/watch 13 hours of TV a day like his old dad.

B.A.C.A.H.   befriend   ignore   Fri, 4 Jan 2013, 2:42am PST   Share   Quote   Like   Dislike     Comment 21

rfsanders says

I worked in TV news for a couple years

sanders, you should write a book about your experiences, just be careful to sanitize it to protect yourself from a lawsuit.

Peter Buffington wrote such a book about working in a different "glamour" industry in his pursuit of a glamorous career as an airline pilot. It's called Squawk 7700. Your post about the TV business sounds like it has some parallels in the "pursuit of a glamorous career". Kinda makes me wonder about all the silicon "Valley Talk" which is nearly completely coming from folks who moved here from outside the region.

bmwman91   befriend   ignore   Fri, 4 Jan 2013, 3:10am PST   Share   Quote   Like   Dislike     Comment 22

JodyChunder says

The suspense is bugging me..."since I was..." what?? Since you were what?!!!

It's okay to not own a TV, but you don't actually want to be one of those guys who mentions it too often. I know you know the type. Like my son in Washington, who thinks he's so cool and tweedy because he doesn't own/watch 13 hours of TV a day like his old dad.

...since I was ~18 and living at home.

Dude, it makes me super cool to talk about how I don't own a TV. Everyone can totally see how free-thinking and independent I am. And I know that most people won't get rid of their TVs, so I am GUARANTEED to remain cool and independent. You see, I do this thing where I post on the internet, and that's TOTALLY underground.

The Professor   befriend   ignore   Fri, 4 Jan 2013, 8:17am PST   Share   Quote   Like   Dislike     Comment 23

I don't own a TV either, but I have three computers that can play dvd's and stream most anything I want commercial free. The Monitor in the living room is 40".

I don't have cable, HBO or any other broadcast. Am I missing anything?

Goran_K   befriend   ignore   Fri, 4 Jan 2013, 11:44am PST   Share   Quote   Like   Dislike     Comment 24

The Professor says

I don't have cable, HBO or any other broadcast. Am I missing anything?

If they offered HBO as a stream on the net, I would probably get rid of most cable. I love all the shows they have, Boardwalk Empire being my favorite.

JodyChunder   befriend   ignore   Fri, 4 Jan 2013, 2:10pm PST   Share   Quote   Like   Dislike     Comment 25

The Professor says

I don't have cable, HBO or any other broadcast. Am I missing anything?

I don't have cable either, but when I'm staying in a hotel, I do watch The Weather Channel. At home I watch mostly educational and How To videos. I've been busy lately learning basic Kung Fu in my living room, which, honestly, I'm finding not to be the most practical subject for a DIY approach. It's weird. But at least this particular series has French subtitles, so I'm picking up a little culture to boot! Dropkick après moi!

JodyChunder   befriend   ignore   Fri, 4 Jan 2013, 2:23pm PST   Share   Quote   Like   Dislike     Comment 26

bmwman91 says

Dude, it makes me super cool to talk about how I don't own a TV.

Don't get me wrong - I think it's a healthy thing. The last time I could say it was just after I got out of the Navy in October '73 and hadn't seen hardly any TV or movies in over 4 years. I hadn't thought about how out of touch I was til later that month when I couldn't figure out what the fuck half the trick-or-treaters costumes were supposed to be. There was even a couple of dicks with baseball bats..."I'm Wow-kin' Tawl!" (Walking Tall - this was Texas)

Goran_K   befriend   ignore   Sat, 5 Jan 2013, 12:06am PST   Share   Quote   Like   Dislike     Comment 27

SFace says

Look at ROKU.

Hmm reading their website. This looks very interesting. I'd be interested in getting HULU Plus, HBO Go, and Disney (my son loves it).

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