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Housing Bubble Pre-Flight Checklist


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2006 Apr 10, 7:44am   29,416 views  313 comments

by HARM   ➕follow (0)   💰tip   ignore  

1. Congress enacts/President signs new Tax Code into law (1997) subsidizing real estate speculation? Check.

2. Cabal of arrogant Fed bankers/Washington politicians/Brokerage firms ignore (or actively encourage) massive Dot.com stock bubble? Check.

3. Aforementioned stock bubble imploding in Fed's/Pol's faces (2000)? Check.

4. Extreme Fed/Pol fear of damage to the rest of the economy by ruptured stock bubble and willingness to flood economy with ultra-cheap credit (to inflate new bubble)? Check.

5. Massive GSEs market intervention, allowing private mortgage lenders to shift default risk from themselves onto taxpayers, FCBs & institutional investors (using the magic of MBS/CMOs)? Check

6. Complete erosion of lending standards, thanks to Fed's easy credit + GSE's MBS/CMO mortgage risk transfer? Check.

7. Cabal of arrogant Realt-whores enforcing monopoly MLS, gaming the numbers and lobbying for federal protection? Check.

8. Public's unshakable faith in the impregnability of real estate ("it never goes down")? Check.

9. Public's complete lack of historical memory, understanding of credit bubbles, the Fed/GSEs, business cycles, etc.? Check.

10. China/Japan underwriting much of our toxic MBS/CMO debt, while secretly hoping we fall on our asses? Check.

11. International carry-trade spawning RE bubbles all over the globe, thanks to ultra-cheap $USD ? Check.

HOUSING BUBBLE, YOU ARE CLEARED FOR TAXI

Discuss, enjoy...
HARM

#housing

« First        Comments 115 - 154 of 313       Last »     Search these comments

115   Peter P   2006 Apr 10, 4:14pm  

Probabilities are mathematically consistent and abide by proofs and theorems.

Only if the underlying randomness can be ascertained.

116   Peter P   2006 Apr 10, 4:16pm  

yes, you can manipulate the number and trick someone who don’t know into something.

but statistic is very important without it biological research or any other physical science can not move forward……

True, but statistics is just another tool in academic politics.

117   astrid   2006 Apr 10, 4:16pm  

I got a little further than probabilities. I took a college biology class and we had to do regressions and so forth. If I remember correctly, as long as I set the perimeters tightly enough, then the results are believable.

But in reality, if the problem ever came up, I just send the link to my boyfriend and wait for a reply.

118   Peter P   2006 Apr 10, 4:16pm  

Stats really may be a kind of evil.

You are probably 66.6% correct.

119   astrid   2006 Apr 10, 4:17pm  

I'd say that's not very good.

120   Randy H   2006 Apr 10, 4:18pm  

Only if the underlying randomness can be ascertained.

Remember there are two types of mathematical proofs, the classically reasoned type we all learned in high-school (or should have), and the "exhaustive" type where all possible disproofs are ruled out. Probabilities, like binomial distributions abide by this (although maybe they are also arrived at classically; IANAMPHD).

Theoretically, all randomness can be ascertained with enough empirical measurement.

121   Randy H   2006 Apr 10, 4:20pm  

You are probably 66.6% correct.

But this stat is useless to me without an alpha or standard deviation and sample size, damnit!

122   Unalloyed   2006 Apr 10, 4:20pm  

I like the way engineers do proofs: "Works for n=1, works for n=2, works for all n."

123   Peter P   2006 Apr 10, 4:23pm  

Theoretically, all randomness can be ascertained with _enough_ empirical measurement.

Well, well, well... what is moral certainty?

124   Peter P   2006 Apr 10, 4:24pm  

I like the way engineers do proofs: “Works for n=1, works for n=2, works for all n.”

Induction is math, not statistics.

125   astrid   2006 Apr 10, 4:24pm  

"an alpha or standard deviation and sample size, damnit!"

But if we assume Peter P as the entirety of the evil/non-evil universe...

126   Peter P   2006 Apr 10, 4:26pm  

But if we assume Peter P as the entirety of the evil/non-evil universe…

Huh?

127   Unalloyed   2006 Apr 10, 4:26pm  

I meant to be humorous...they jump from n=1 & n=2 to all n, without mathematical induction.

128   astrid   2006 Apr 10, 4:27pm  

Well, that would do away with the sample size issue.

129   Unalloyed   2006 Apr 10, 4:28pm  

Why it's called mathematical induction when it's a deductive process is a mystery to me. Didn't mean to change the subject away from chi squared distributions and what not.

130   Peter P   2006 Apr 10, 4:28pm  

I meant to be humorous…they jump from n=1 & n=2 to all n, without mathematical induction.

It is fine if n = 2...

131   Randy H   2006 Apr 10, 4:33pm  

Might as well include economists in our late-nite festival:

Micro Economists do proofs as such: if a rational n = 1 but would like to be n = 2, and a rational m = 2 but would like to be one, then P = 1.5, but only assuming elasticity of ..., then we take the set the first derivative AC = 0 ... and finally we discover that MR = MC. Wow, lets make this into a 400 page book with lots of graphs.

Macro Economists do proofs as such: money = this theory, aggregate supply = that theory, capital = other theory, inflation = this + that - other theory. Wave hands a lot, and *poof*, we can't tell you anything about the future except that it is uncertain, but we can explain the past as if we should have known it before it happened.

132   Randy H   2006 Apr 10, 4:35pm  

Well, that would do away with the sample size issue.

If you know alpha you don't need the sample size, but it would be nice. You know how accurate the guess is with an alpha (because it incorporates n and sigma).

133   astrid   2006 Apr 10, 4:35pm  

LMAO,

That's why I did much better in Macro than Micro economics.

134   Unalloyed   2006 Apr 10, 4:39pm  

If extraterrestrials were monitoring transmissions from Earth, what would have more meaning for them...the decimal expression of pi to 100 thousand digits, or Hootie and the Blowfish?

135   Randy H   2006 Apr 10, 4:40pm  

They're watching Seinfeld reruns in the Vega system about now, aren't they?

136   astrid   2006 Apr 10, 4:40pm  

I think they'd be studying up on how to serve us

for dinner

137   Peter P   2006 Apr 10, 4:42pm  

I think they’d be studying up on how to serve us for dinner

Free-range human with truffle cream sauce?

138   FormerAptBroker   2006 Apr 10, 4:43pm  

Owneroccupier Says:

“There is a gay phase in adolescence for all guys”

I think it is many, but not “all” guys…

“most of us grow past that, some of us get stuck there. Sexual orientation is not entirely a natural-born thing, it is also influenced strongly by your early sexual experience and sexual partner.”

I think that almost everything is a combination of both nature “and” nurture.

If you look at 100 kids from normal families you will naturally have a small number of gay kids, by if you look at a group of 100 kids who were molested by an older step brother for years you will have a lot more gay kids. The results will be similar if you look at when you guys who hit women every now and then you will have a kid who grew up in a happy Christian home who for some strange natural reason beats his wife, but most abusers come from homes where Dad beat the crap out of the kids and their Mom…

139   Unalloyed   2006 Apr 10, 4:44pm  

I think sending them a simple sequence of prime numbers would stop them dead in their tracks - Sort of like the Jesuits marching into the Amazon with the Crucifix held high before them.

140   Peter P   2006 Apr 10, 4:50pm  

I think sending them a simple sequence of prime numbers would stop them dead in their tracks - Sort of like the Jesuits marching into the Amazon with the Crucifix held high before them.

Braised "prime number" human brain with cracked pepper.

141   astrid   2006 Apr 10, 4:52pm  

Let the feast of a thousand beasts begin!

142   Unalloyed   2006 Apr 10, 4:53pm  

Content has degraded from the thread standard.

143   Peter P   2006 Apr 10, 4:54pm  

Content has degraded from the thread standard.

How?

Do you think aliens will eat human sushi? Or they may think we are filthy animals?

144   astrid   2006 Apr 10, 4:55pm  

"Content has degraded from the thread standard."

(I'm gonna incorporate that into a Donnie Darko comment and then head for bed)

145   astrid   2006 Apr 10, 4:56pm  

Peter P,

Are you saying Aliens observe Kosher law?

146   Peter P   2006 Apr 10, 4:57pm  

Oops... if aliens are studying this thread... we just gave them some recipes... oh no!

---

Dear aliens, Our brains taste horrible and truffle cream sauce is no good.

147   Unalloyed   2006 Apr 10, 4:58pm  

astrid gently warmed, drizzled with Jake G. cream sauce. Then sent to bed.

148   Unalloyed   2006 Apr 10, 5:02pm  

I guess I'll be banned for sure now.

149   Peter P   2006 Apr 10, 5:05pm  

I guess I’ll be banned for sure now.

No one will be banned for suggesting a recipe.

150   Unalloyed   2006 Apr 10, 5:08pm  

Disclaimer: No recipes here posted have been kitchen tested.

151   astrid   2006 Apr 10, 5:09pm  

"astrid gently warmed, drizzled with Jake G. cream sauce. Then sent to bed."

And on that obscurely obscene note, good night to all and to all good night.

152   Peter P   2006 Apr 10, 5:14pm  

Disclaimer: No recipes here posted have been kitchen tested.

Also, no animals have been harmed.

153   Unalloyed   2006 Apr 10, 5:22pm  

Disclaimer: All references to Jake Gyllenhaal cream sauce are made without the express consent of Sony Pictures Inc., Paramount Inc., or Warner Brothers Productions.

154   Peter P   2006 Apr 10, 5:55pm  

Okay now, what is Jake Gyllenhaal cream sauce? Is it similar to truffle cream sauce?

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