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Whose side is the Treasury on?
invite response
2008 Oct 15, 3:09pm 42,770 views 353 comments
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Peter P
2008 Oct 24, 5:14pm
Question: how safe is the options clearing process? Will the clearing houses for US listed options become compromised?
Propping up demand for housing will bring some trust back to the system.
And trust will eventually put a stop to the deleveraging cycle.
There are people in the sidelines that can be convinced to jump in the water.
Propping up prices reduces demand for housing.
There are hundreds of thousands of eager buyers waiting on the sidelines to buy up real estate. RE this is priced right sells almost immediately.
Lost Cause
2008 Oct 25, 12:32am
There are millions of vacant (even boarded up) houses and condos as well.
"Propping up demand"
What the fuck does that mean? Seems like an oxymoron. If you mean propping up "prices" then it's obvious that demand will continue to drop.
Face it, the times where you can just plop money into real estate and watch it appreciate overnight are gone forever. You have to get a real job now.
Malcolm
2008 Oct 25, 1:51am
deflation Says:
October 25th, 2008 at 7:38 am
"Face it, the times where you can just plop money into real estate and watch it appreciate overnight are gone forever. You have to get a real job now."
Are you trying to incite a riot?
DennisN
2008 Oct 25, 4:06am
Even Suze O says wait until 2010....
www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/10/25/BUJI13NAC9.DTL
Q: When might the housing market bottom out?
A: I think it's going down another 10 percent, 20 percent, and I think you're looking to 2010.
Successful investors have various styles of investmens and different means to achieve money but they all have one thing in common, they all admit that they never attempt to buy assets by timing bottoms. You are always better off waiting for the the first 5%-10% increase in the asset prices.Its small price to pay in order to avoid catching a falling knife.
HeadSet
2008 Oct 26, 6:17am
If we cap the mortgages to 5 times the amount of gross income we make sure that new owners can sustain the debt.
This statement is mutually exclusive with your post about having the gov stabilize prices. There is nowhere near enough $100k+ earners to buy all the would be "stabilized" $500k+ houses out there. Plus, we may see the pool of high earners shrink in the next few months.
Why not cap at 3 times gross income, the Patrick Safe Mortgage? After all, a family with $100k gross is about $72k take home, or about $6k/mo. A payment on a $500k home would be about $3200 before taxes and insurance. Not a good thing to spend over half ones take-home pay on house expense.
Peter P
2008 Oct 26, 6:36am
Again, Free Market is very good at pricing risks *IF* bailouts are not expressed, implied, or assumed. We certainly do not need a government-imposed mortgage cap based on gross income.
Again, Free Market is very good at pricing risks *IF* bailouts are not expressed, implied, or assumed. We certainly do not need a government-imposed mortgage cap based on gross income.
Unfortunately, the Free Market has a nasty habit of showing up with a bundle of dynamite strapped to its chest and threatening to blow up the free market if it doesn't get a bailout.
That is not Free Market… that is people hijacking Free Market.
That is because the Free Market rewards hijacking.
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According to this article in the NY-Times:
http://tinyurl.com/3hzwmp
In its latest questionable tactic, the Treasury is forcing banks to take billions of taxpayer dollars and lend it out - effectively trying desperately to blow some air back into the lending bubble. They know it will ultimately lead to an unsustainable debt burden on the US taxpayer, and very likely US government default but they don't care. This can't just be stupidity or greed - it is treason.
(Mish's take on this is over here: Compelling Banks To Lend)
The actions taken by the Treasury in recent days show a pattern of putting U.S. citizens/taxpayers under a huge public debt burden, and also encourage every possible way to get them into private debt. Simultaneously, avenues that would _reduce_ private debt, or reduce risk to taxpayers are being blocked, derailed or discouraged.
Why?
Why is there a systematic policy bias towards forcing the US into default? Why is the Treasury making decisions that push generations of Americans into debt-slavery and eventual destruction of US sovereign currency?
Which team is Paulson batting for?
SP