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GSEs too Socialistic for Red China


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2006 Mar 23, 2:46pm   10,675 views  127 comments

by HARM   ➕follow (0)   💰tip   ignore  

China does not plan to emulate U.S. GSEs

VENICE, Italy, March 23 (Reuters) -

China has no desire to create Freddie Mac (FRE.N: Quote, Profile, Research) or Fannie Mae (FNM.N: Quote, Profile, Research) style government sponsored enterprises (GSEs) to help develop its mortgage market, a former regulator of the two U.S. home funding companies said on Thursday.

"...The Chinese are adamant about having private sector mortgage lenders that are not reliant on government subsidies," the former regulator of the two U.S. government sponsored enterprises (GSE) told a bond conference in Italy.

Falcon said Freddie and Fannie were created during the Depression in the 1930s, and Americans are still living with their unintended consequences. "The unintended consequences are their portfolios create systemic risk to the financial system," Falcon told Reuters on the sidelines of the conference.

Freddie and Fannie hold a combined $1.4 trillion in mortgage portfolios. Senator Richard Shelby, a Republican from Alabama, along with the Federal Reserve and the White House argue that the portfolios pose a risk to the financial system of the world's largest economy by aggregating interest rate risk, and requiring the two listed companies to engage in extensive and complicated hedging."

Interesting... The Communist central government of China finds the GSEs too socialistic for its taste. The mortgage securities market of what is arguably the most advanced and successful capitalist nation in human history being indirectly critiqued by Communist apparatchiks for not being free market enough.

Wow... what to make of that?

What's next: Sudan criticizing our record on human rights? Saudi Arabia lecturing us on religious tolerance? Should I feel amused or embarrassed? Has Hell truly frozen over?*

Discuss, enjoy...
HARM

*Disclaimer: THOUGH I DISLIKE THE GSEs, IN NO WAY DO I FEEL THAT RED CHINA WITH ALL ITS ANTI-COMPETITIVE, ANTI-FREE MARKET CORRUPTION, GOVERNMENT MONOPOLIES, PROTECTIONISM, LACK OF RESPECT FOR HUMAN AND PROPERTY RIGHTS, ETC., ETC. IS IN ANY POSITION TO BE CRITICIZING THE U.S. NOR AM I ADVOCATING MODELING OUR HOUSING OR FINANCIAL MARKETS AFTER CHINA’S. I FOUND THEIR IMPLICIT CRITICISM TO BE HUGELY IRONIC, AND THEREFORE FUNNY AND WORTHY OF NOTICE.

#housing

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48   Peter P   2006 Mar 24, 6:54am  

HARM, are you suggesting that SFWoman is a "fifth columnist"? :-O

49   HARM   2006 Mar 24, 6:59am  

@Peter P,

No, not all. Perhaps I didn't express my thoughts clearly. I just feel that unpatriotic people like her are destroying the social fabric of this country --that's all. Sorry for any confusion. ;-)

50   Peter P   2006 Mar 24, 7:00am  

HOMO AMERICANUS: therefore more food means it will be more harmonic.

I have this "never-ending meal" idea in mind. If we carefully size the portion and time the arrival of each course, an infinite meal can become a possibility. Of course, there needs to be bathroom and napping breaks between courses.

51   Peter P   2006 Mar 24, 7:03am  

No, not all. Perhaps I didn’t express my thoughts clearly. I just feel that unpatriotic people like her are destroying the social fabric of this country –that’s all. Sorry for any confusion.

Oh no! What are we going to do?

Fortunately, work will make us free. ;)

52   Phil   2006 Mar 24, 7:05am  

@Hymie,
I am not good at stocks either but when you say you are dumping stocks - you mean you are selling them at cheaper price than what you bought it for but there has to be someone out there to buy it at that cheaper price - or else how are you selling it ? So there is someone out there that thinks that that stock has some value at that cheap low price and will buy and hold on to it till it increases in value.
So stocks and RE are the same.

53   Peter P   2006 Mar 24, 7:08am  

Of course real estate can only go up. Are you attempting to destroy everything we stand for? They make no more land.

Right. I am glad that you see the light. Every bubblehead is a fifth columnist. ;)

54   Peter P   2006 Mar 24, 7:10am  

This is already happening. Have you eaten at MM (Michael Minna) in the St. Francis?

I will try...

Is it better than Gary Danko's and/or Silks? But I believe most tasting menus last only a few hours. Perhaps we need to introduce multi-day tasting menus.

55   HARM   2006 Mar 24, 7:16am  

@Davis_renter,

Out of moderation.

56   surfer-x   2006 Mar 24, 7:19am  

I just love this double-speak

California had more unsold homes in February than at any other time in the past eight years, as sales of existing houses slowed further with rising mortgage rates and high prices, according to a report released on Thursday.

The inventory of unsold homes rose to a 6.7-month supply last month, said the California Association of Realtors, based in one of the hottest U.S. real estate markets in recent years.

"There are a lot of people who can't afford to buy at today's prices," said John Burns, an Irvine, California-based consultant to home builders. "It looks to me like the market is headed for a soft landing."

Ok, lets shift the order a bit,

The inventory of unsold homes rose to a 6.7-month supply last month. "There are a lot of people who can't afford to buy at today's prices," said John Burns, an Irvine, California-based consultant to home builders. California had more unsold homes in February than at any other time in the past eight years, as sales of existing houses slowed further with rising mortgage rates and high prices. "It looks to me like the market is headed for a soft landing."

No actually it looks like your soon to get your ass handed to you.

57   surfer-x   2006 Mar 24, 7:20am  

-your
+you're

58   Peter P   2006 Mar 24, 7:21am  

SFWoman, do you know of a good place to have High Tea in the city?

59   Randy H   2006 Mar 24, 7:27am  

SFWoman,

Juku is not a real person. Nor are his aliases.

It is an automated NLP using such sophisticated AI algorithms that it is almost entirely indistinguishable from a knee-jerk, jingoistic, reactionary demagogue ideologue. I actually have my suspicions that it was developed by Felwesh, who derived it as a complex Bayesian network one weekend when he was attempting to disprove the utility of Neural Networks. However, Peter P and I have developed Genetic Algorithms which carefully select testing parameters and are able to see through Fewlesh's evil blogbots.

The battle only now just begun.

60   Peter P   2006 Mar 24, 7:30am  

NLP = neuro-linguistic programming?

61   LILLL   2006 Mar 24, 7:30am  

Surfer-X
Does that mean you're 67%more offensive while blogging??? :)
BTW, I've never actually found you offensive...though the day is young!

62   Randy H   2006 Mar 24, 7:32am  

NLP = Natural Language Processing/Processor, but I like yours too.

63   Peter P   2006 Mar 24, 7:34am  

How about NLP^2?

It would be a bot using Natural Language Processing and Neuro Linguistic Programming to brainwash people.

64   surfer-x   2006 Mar 24, 7:44am  

Does that mean you’re 67%more offensive while blogging???

No, just 37% less offensive in person*

*Note: not investment advice.

65   Peter P   2006 Mar 24, 7:48am  

OK, now, when I lived in London ‘High Tea’ wasn’t the sandwich/scone clotted cream thing we think about here. It was a children’s supper at about 5:00 and consisted of fish fingers or a sausage and beans, or something like that.

Yes, I have watched a documentary about that a while ago.

I do like rich and heavy food occasionally and I do like fish fingers. ;)

It’s like golf, fun, but who has the time?

Now I hate golf. Can't hit anything at all recently.

66   Peter P   2006 Mar 24, 7:54am  

Wow, do you mean I have entered a battle with an evil robot? I hope my training will enable me to prevail.

I am sure the evil robot uses evolutionary algorithms. Your training in microbiology will come in handy.

67   Peter P   2006 Mar 24, 8:03am  

I can have a heavy dinner only once every a few weeks.

On the other hand, scones are not that difficult to prepare yourself anyway. The key is Devonshire cream (or any cream with 50% fat ;) ) which is readily available.

68   Peter P   2006 Mar 24, 8:04am  

Molecular biology. Sheesh.

My bad. I am very ignorant in science.

69   Phil   2006 Mar 24, 8:15am  

@Hymie
I didnt have stocks during the stock bubble burst but I am thinking, did we have the same scenario where people were trying to unload their accumulated tech stocks during the beginning of the crash but they couldnt find buyers and had to hold on it and watch while the value went down ?
I do agree that stocks tend to trade faster because it is a much smaller asset compared to a RE and also because of the advances in Tech.

70   Randy H   2006 Mar 24, 8:31am  

SFWoman,

With your molecular biology background, you are well equipped to join the battle. Peter P and I will attempt to provide you with the tools necessary to emerge victorious. But I warn you that if, as we suspect, Fewlesh is behind this evil, your opponent is worthy and capable. Might I recommend using Surfer-X as your benchmark Turing Machine.

71   Peter P   2006 Mar 24, 9:12am  

I am up for the challenge!

Make sure that planets align at the time of the battle.

72   Peter P   2006 Mar 24, 9:55am  

So the Juku roboto is a fifth columnist?

73   Different Sean   2006 Mar 24, 10:14am  

a government that is clearly not an ideal one.

hmm, so we trust our own politicians now? are dubya and rice and rumsfeld and wolfowitz and powell and the whole lying conniving gas/oil junta who got in on 2 rigged, undemocratic elections a preferred option? is FEMA an effective institution? how well did they deal with the aftermath of katrina? what about the reading of 'my pet goat' while the WTCs were being attacked, and the general disappearance of the leadership for several days? interesting how little interest for the people is being shown by the so-called 'leadership', hmm. seems more like a kleptocracy to me - loot the coffers for our cronies while we're in power... even if dubya's popularity is at an all-time low, are you convinced that the diebold machines with their 'commercial-in-confidence' code are going to allow a better alternative to be elected next time? 1984, here we come...

under the surface, china is actually a tremendously commercial culture - they are born mercantilists. note that the industrialising south of china, far removed from beijing, is the engine-room of the chinese economy, and taking over the world - at least while labour is cheap. many chinese factory owners, and others, are getting wildly rich from the manufacturing boom. however, they are just culturally different, and starting from a different place and a different set of understandings. remember things only started to get better for people in the 'western world' and people started to develop a sense of 'fair play' once they could accumulate relatively large and stable surpluses and thus gain reasonably assured levels of wellbeing.

The inventory of unsold homes rose to a 6.7-month supply last month. “There are a lot of people who can’t afford to buy at today’s prices,” said John Burns.

Interesting ratchet effect with property prices - people are very loathe to see prices drop, defying a traditional supply/demand economic model... And some of these people bought their houses for chickenfeed prices decades ago, and still want to get top dollar, it's not as tho they bought last year and are going to get a complete soaking if they sell for only 8 times what they originally paid instead of 12.

74   Randy H   2006 Mar 24, 10:14am  

Juku roboto, it's all making sense now.

The conspiracy ranges beyond Jukubot, I'm afraid. I fear it is in fact a syndicate of Orwellian bots, coordinated and working towards the same goal of undermining Western Democratic Liberal Market Capitalism. [Note I have purposefully interjected an ambiguous usage of the "L" word to test the Turning merits of monitoring Jukubots.]

Could this all be emanating from "The Futurist". Is "The Futurist" itself a mocking title, in grand Orwellian style, which foretells the distortions we can expect in this yet free media of the blogosphere?

I need a drink.

75   Peter P   2006 Mar 24, 10:18am  

[Note I have purposefully interjected an ambiguous usage of the “L” word to test the Turning merits of monitoring Jukubots.]

Do you think it is goog enough to defeat captcha? If it is, perhaps we can turn it into the ultimate spamming machine.

76   Different Sean   2006 Mar 24, 10:23am  

the Futurist 'article' (read: uninformed and jingoistic opinion piece) on strategic relations between the US and India was just hysterical...

According to the article, everyone who fights the red menace is a 'friend' of the US, and no country is self-interested - they all just want to be allies with the US and do as they're told. India is generally a desperately poor 3rd world country, the US has set up a lot of industry there, of course they're not inimical to the flows of money, and the possibility of leaving to a more affluent life one day. As soon as Indians become sufficiently wealthy, they can't wait to leave the place and get away from the whole mess, they don't hang around...

Australia is actually better positioned geographically than the US to be a strong trading partner and ally with both China and India, including huge migration transfers and business partnerships... You will notice the Australian govt is very loathe to criticise China on anything much, as Australia is poised to be the English-speaking entrepot centre for trading in the whole south Pacific and Indian regions...

77   surfer-x   2006 Mar 24, 10:54am  

@Bap33, just been busy spreading the love down in $anta Barbara, replace the engine in my Tbird, I drive through Montecito and screw at the yuppies, then hit the 3-wheel motion, take a sip of the potion and I'm outa there.

78   Different Sean   2006 Mar 24, 11:08am  

If toast always lands butter-side down, and cats always land on their feet, what happen if you strap toast on the back of a cat and drop it?

why don’t the chinese just take the Apollo moon pictures and paste chinese faces on Neil and the crew

don't give jack white any more ideas... : (
http://www.aulis.com/jackstudies_1.html

79   LILLL   2006 Mar 24, 11:18am  

Randy H
I thought the 'L' Word was a sexy lesbian show on Sunday evenings. Am I Wrong?

80   Girgl   2006 Mar 24, 11:21am  

Is that the Marina District that is under water?
http://sfgate.com/cgi-bin/article.cgi?file=/c/a/2006/03/24/MNG22HTITV1.DTL
(check out the map)

81   LILLL   2006 Mar 24, 11:32am  

In my business, (fountains and statuary and some REALLY cool stuff if I do say so myself) a lot of mfs. take their manufacturing to China for obvious reasons. There is so much corruption, however,if you're making something that has any appeal whatsoever, it's out the back door and knocked off before you can blink. I'm proud that I manufacture in USA. Today was a pretty bad day with that. I had a deal set up with some Armenians to produce my product and they started"trippin on me" so,...I'm in the drivers seat. No deal for the trippin Armenians. Oh well...onto housing and Chinese....

82   Randy H   2006 Mar 24, 11:33am  

Linda in LA-LA

Even more cleverly hidden ambiguity. We'll see just how good the Jukubot is.

83   LILLL   2006 Mar 24, 11:35am  

See Randy! You are even more clever than you thought!

84   LILLL   2006 Mar 24, 11:38am  

Does anybody know why there are no "HOUSING STORIES"for Fri.???
I do so look forward to them!

85   LILLL   2006 Mar 24, 11:44am  

sorry
from going out the backdoor
It's Friday...I'm drinking Cotes Du Rhone...

86   Different Sean   2006 Mar 24, 12:50pm  

The Economy: Consumer Fatigue
The consumer is finally fatigued.
The surge in housing prices over the last five years has largely been fueled by low mortgage rates, looser lending standards and an increase in speculative real estate investing.

Absolutely. It's a dog-eat-cat world (because we let it be).

lower housing prices could whittle away at consumer confidence and spending.

I'm not so sure about this one - consumer confidence is down right now because young people have a bigger % of their income going into passive bricks and mortar (or frame and weatherboard, depending), thus reducing discretionary spending in retail. In other words, empty land is soaking up their $$$, hurting the retail sector.

87   surfer-x   2006 Mar 24, 1:25pm  

Am I the only one that noticed that Linda said backdoor?

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