patrick.net

HousinBoom is sitting. He is waiting, on the assumption that the collapse is very, very near. And if it does not happen soon, he may be willing to wait it out for a lifetime

Then stop putting words in my mouth. Just because you have no valid argument, you shouldn't twist other people's words. I never said "I am willing to it out for a lifetime"

96 CDon 2013 Jan 31, 7:01am

CDon says

HousinBoom is sitting. He is waiting, on the assumption that the collapse is very, very near. And if it does not happen soon, he may be willing to wait it out for a lifetime

Then stop putting words in my mouth. Just because you have no valid argument, you shouldn't twist other people's words. I never said "I am willing to it out for a lifetime"

I said "may" because you seem unwilling or perhaps unable to pick a time upon which you will reconsider your thesis.

Lets try this a different way. Assume its now the year 2063 - the fed is still printing like mad, and the stagnation continues, with no calamity having taken place - at what point in that 50 year time continuum will you have purchased?

HousingBoom 2013 Jan 31, 7:04am

Lets try this a different way. Assume its now the year 2063 - the fed is still printing like mad, and the stagnation continues, with no calamity having taken place - at what point in that 50 year time continuum will you have purchased?

This proves my point. Crack for brains think we can print trillions out of thin air for the next 50 years. lol. I'm done. you know what they say, never argue with an idiot, they'll bring you down to their level then beat you with experience.

98 nope 2013 Jan 31, 7:09am

I'm willing to bet anybody 5 ounces of gold that there will be no economic collapse in the next 2 years. 20 for 5.

"I don't understand economics so I'm scared by arbitrary statistics" is a weird way to live your life.

99 yup1 2013 Jan 31, 7:15am

Crack for brains think we can print trillions out of thin air for the next 50
years.

It is frustrating but Japan has been doing it for 20+ years..........

100 CDon 2013 Jan 31, 7:15am

This proves my point. Crack for brains think we can print trillions out of thin
air for the next 50 years.

Out of curiosity, what have they have been doing for the last 200 years? If they have done it for 200, why can they not do it for another 50?

101

HousingBoom 2013 Jan 31, 7:23am

HousingBoom says

Crack for brains think we can print trillions out of thin air for the next 50

years.

It is frustrating but Japan has been doing it for 20+ years..........

There is a good possibility that we will be like Japan but we can already see inflationary forces right now in food and other commodities.

102

tatupu70 2013 Jan 31, 7:24am

The Professor says

It does not look like the Federal Reserve (established December 23, 1913) helped with smoothing out the business cycle; quite the contrary. I also noticed that our economy booms with war.

Are you looking at the same chart as I am? Certainly, the Federal Reserve didn't instantaneously change things, but clearly the business cycle has been smoother after WWII. To what do you attribute that change?

103 yup1 2013 Jan 31, 7:28am

The Professor says

tatupu70 says

OK--Here is a chart showing US GDP since the early 1800s. You tell me--does it look like there were more boom/bust cycles before 1970 or after 1970?

It does not look like the Federal Reserve (established December 23, 1913) helped with smoothing out the business cycle; quite the contrary. I also noticed that our economy booms with war.

That is graphing business cycles it is not even showing the 2008 crash, HAHA

104 CDon 2013 Jan 31, 7:35am

Yup, that's a possibility. The fact that central banks are trying to hoard as
much gold as possible tells me that they are losing faith in the system. The
system does not have to fail for home prices to fall another 20%+. That is all I
am expecting at best.

I fully expect you see your 20% - however, as has been the case for the last 3 years, I fully expect you see it in the form of nominal stagnation while inflation slowly works its magic and the remaining slack in the system is removed. You have very little upside risk in waiting IMO.

105 yup1 2013 Jan 31, 7:38am

The Professor says

If the crash happens those with property and precious metals will be ok, not
great, ok. Those in paper (401k, stocks, bonds, etc.) are screwed.

If the crash happens all asset prices will get crushed. Cash is king when credit is collapsing.

106

tatupu70 2013 Jan 31, 7:41am

That is graphing business cycles it is not even showing the 2008 crash, HAHA

Did you look at the x-axis? The chart is a little dated, I'll grant, but it clearly shows underwater was very, very wrong.

107

HousingBoom 2013 Jan 31, 7:42am

The Professor says

If the crash happens those with property and precious metals will be ok, not

great, ok. Those in paper (401k, stocks, bonds, etc.) are screwed.

If the crash happens all asset prices will get crushed. Cash is king when credit is collapsing.

It's going to be a crash but we don't know if it's a deflationary one (stock market collapse) or inflationary (bond market and/or dollar collapse). The job market is the biggest factor for home prices. All I know is that the job market will be in a world of hurt when this occurs. This will not be a soft landing like most bulls are predicting. The longer it doesn't happen, the bigger the bubble and the bigger the collapse will be

108 yup1 2013 Jan 31, 7:56am

HousingBoom says

Wages are falling so any price increase is not sustainable IMO

http://news.yahoo.com/personal-income-posts-biggest-gain-eight-years-133706758--business.html

That is from early dividend payouts for tax purposes. It will not continue.

109

tatupu70 2013 Jan 31, 7:58am

That is from early dividend payouts for tax purposes. It will not continue.

Maybe, maybe not. But to say that incomes are falling is not right.

110

HousingBoom 2013 Jan 31, 8:01am

Maybe, maybe not. But to say that incomes are falling is not right.

That payroll tax just killed any hopes of an increase in wages. lol

111 yup1 2013 Jan 31, 8:05am

http://beschloss.blogs.mydesert.com/2013/01/07/flat-per-capita-incomes-weigh-on-us-employment-sector/

Maybe, maybe not. But to say that incomes are falling is not right.

Sorry on that point you are incorrect.

112 yup1 2013 Jan 31, 8:09am

That payroll tax just killed any hopes of an increase in wages. lol

You got that right!

113

tatupu70 2013 Jan 31, 8:13am

Sorry on that point you are incorrect.

I didn't know your timeframe was a decade. I figured you were referring to present time

114 yup1 2013 Jan 31, 8:26am

robertoaribas says

54k down to 50K sounds about right for the crisis

I was only linking to show the income drop I did not read his crappy blog :D

115 yup1 2013 Jan 31, 8:29am

I didn't know your timeframe was a decade. I figured you were referring to
present time

Oh yes more long term, short term gains are too volatile. And that is the average which is dragged higher by the high end. A better statisic would be median incomes which are hopelessly low, 26k is the median single wage in the US, DOH!

116 CDon 2013 Jan 31, 8:32am

This will not be a soft landing like most bulls are predicting.

While written today - this could have just have easily been written 3 years ago.

For the last 3 years, despite you continuing to call for a "collapse", it has been the soft landing as each crisis turns into nothingburger after nothingburger. So again, is there any point in the next 0-50 where you decide to re-evaluate your conclusion? Is there any point in the next 0-50 years when you say, "gee, I guess there is not going to be a second collapse after all"?

And if not a date, how bout an event? If the DJIA hits say XYZ then you will change your tune. Or perhaps if unemployment hits ABC then you will reconsider...

BTW - if the answer for you is "I dont know" so be it. It just seems to me that anyone this "certain" of something, despite the some or even any evidence to the contrary, is setting themselves up for a lifetime of disappointment.

117 yup1 2013 Jan 31, 8:36am

For the last 3 years, despite you continuing to call for a "collapse", it has
been the soft landing as each crisis turns into nothingburger after
nothingburger. So again, is there any point in the next 0-50 where you decide to
re-evaluate your conclusion? Is there any point in the next 0-50 years when you
say, "gee, I guess there is not going to be a second collapse after all"?

I guess I would ask why do you believe that 2008 cannot be repeated? What has changed to stop that from happening? Nothing. Do you think that the Fed can bailout everything if everyone decides to sell? When will you get concerned with the Fed balance sheet 5 Trillion, 10 Trillion, 50 Trillion?

118

HousingBoom 2013 Jan 31, 8:41am

I guess I would ask why do you believe that 2008 cannot be repeated?

Because he's a mental midget!

119

Raw 2013 Jan 31, 8:53am

I guess I would ask why do you believe that 2008 cannot be repeated? What has changed to stop that from happening? Nothing. Do you think that the Fed can bailout everything if everyone decides to sell? When will you get concerned with the Fed balance sheet 5 Trillion, 10 Trillion, 50 Trillion?

Lots of reasons why 2008 can't be repeated anytime soon:
Home prices are not overpriced anymore. They are under priced.
Recent home purchases are not leveraged with zero downs. Many were all cash.
Interest rates are a lot lower.
Economy is not sinking anymore, but making a slow come back.
The worst is over, the future is bright.

120 yup1 2013 Jan 31, 9:00am

Raw says

Recent home purchases are not leveraged with zero downs.

So 3% FHA loans do not happen?

121 yup1 2013 Jan 31, 9:03am

Raw says

Home prices are not overpriced anymore.

So says those that own, those that rent believe the opposite, some of those that own (me) still believe the opposite. Home prices are being supported by low interest rates. What happens if rates rise?

122 yup1 2013 Jan 31, 9:07am

Raw says

Lots of reasons why 2008 can't be repeated anytime soon:

You saying it can't be repeated shows your ignorance. Lehman, Bear, Wachovia, WAMU, Countrywide, Merril, have been absorbed by the remaining big 5 banks. They are now much bigger than before the last crisis when Lehman ALONE destroyed the credit markets. You keep smoking that it can't happen again crack pipe.

123

tatupu70 2013 Jan 31, 9:08am

Raw says

Home prices are not overpriced anymore.

So says those that own, those that rent believe the opposite, some of those that own (me) still believe the opposite. Home prices are being supported by low interest rates. What happens if rates rise?

If rates rise, that means unemployment will certainly have fallen and incomes will be up. So house prices will probably be rising as well.

124 yup1 2013 Jan 31, 9:14am

If rates rise, that means unemployment will certainly have fallen and incomes
will be up. So house prices will probably be rising as well.

The last housing bubble was caused by what? Artificially low payments with crazy subprime loans. Interest only, pick a pay, you name it. Rising rates do not lead to higher home prices.

125 CDon 2013 Jan 31, 9:31am

CDon says

For the last 3 years, despite you continuing to call for a "collapse", it has
been the soft landing as each crisis turns into nothingburger after
nothingburger. So again, is there any point in the next 0-50 where you decide to
re-evaluate your conclusion? Is there any point in the next 0-50 years when you
say, "gee, I guess there is not going to be a second collapse after all"?

I guess I would ask why do you believe that 2008 cannot be repeated?

No absolutely, it can be repeated. I continue to look for risk pricing in the bond market, or in the a1/p2. As they both sit there, while we print with wild abandon, I dont think twice about it. If they start to rise, like we saw in 2007 - absolutely I will be changing my tune - and fast.

Yup1 says..."Do you think that the Fed can bailout everything if everyone decides to sell? When will you get concerned with the Fed balance sheet 5 Trillion, 10 Trillion, 50 Trillion?"

Yes. Unequivocably. Again, I am operating on the assumption that they realize how serious this is - and if push comes to shove, they would much rather risk a global conflict with our creditors than they would see rioting, tanks in the streets, and the risk they could be dragged thru the streets, mogadishu style.

And therein lies the risk with changing course. There is so so so much debt out there - if called simultaneously, like we almost had in 2008, some very very very powerful players on the worlds stage will be very very screwed. And everyone knows this. Hence, no one is willing to pull the trigger - instead they wail, and shout, and then readily gobble down more of our debt.

So in that regard, honestly, there is no notational limit that we cannot exceed. Its kinda like the 500 billion dollar bill (zimbabwe dollars) I got as a gift. The guy got it for $4USD on ebay. Mugabe would rather destroy his country's ability to be a member of the worlds stage than risk dying at the hands of his countrymen. When push comes to shove, I am pretty sure which way our PTB will decide too.

126

tatupu70 2013 Jan 31, 9:57am

Rising rates do not lead to higher home prices.

Of course not. It's not cause and effect. But rates also don't rise and fall randomly. They rise when there is an expectation of inflation and fall when there is an expectation of deflation.

So, if you are saying that rates are rising, that means there is an expectation of inflation, which implies higher incomes and lower unemployment.

127 yup1 2013 Jan 31, 10:00am

Its kinda like the 500 billion dollar bill (zimbabwe dollars) I got as a gift.
The guy got it for $4USD on ebay.

Dude whoever bought that got robbed my buddy got me a 100 Trillion dollar one for 4 bucks, ROFLMFAO!

128 yup1 2013 Jan 31, 10:07am

Hence, no one is willing to pull the trigger - instead they wail, and shout,
and then readily gobble down more of our debt.

So in that regard, honestly, there is no notational limit that we cannot
exceed.

At some point mathematics takes over and the amounts of debt cannot even be serviced, then what? If you are just printing money to make fake reserves you are doing nothing. If that money does not get into the real economy the increased debts will eventually default. I guess you could go with a 0 interest rate, all of that money is fake anyway.

I guess that is the point, do we all not understand at this point that it is all fake. A large group of people being "poor" while an individual person is "rich" when ALL of the credit money ever created is fake is pretty rediculous.

If the population in general ever comes to truely understand the nature of credit money, no one will ever pay back another debt again, EVER!

129 yup1 2013 Jan 31, 10:09am

But rates also don't rise and fall randomly. They rise when there is an
expectation of inflation and fall when there is an expectation of deflation.

That is what they used to mean, I agree. If you think that is what rates mean in todays ZIRP environment I believe you are wrong.

130 yup1 2013 Jan 31, 10:30am

Of course not. It's not cause and effect. But rates also don't rise and fall
randomly. They rise when there is an expectation of inflation and fall when
there is an expectation of deflation.

So, if you are saying that rates are rising, that means there is an
expectation of inflation, which implies higher incomes and lower
unemployment.

Bill Gross from PIMCO said in 2010 that without Uncle Sam backing mortgages rates would climb by 3 to 4 %. I wonder what home prices would be with 7-9% mortgages?

131 nope 2013 Jan 31, 10:31am

You guys understand that Zimbabwe was never a stable global superpower with reserve currency status right?

132 CDon 2013 Jan 31, 10:39am

Dude whoever bought that got robbed my buddy got me a 100 Trillion dollar one
for 4 bucks, ROFLMFAO!

LOL - I stand corrected it was actually a 500 trillion note. Is yours the one with the 2010 redemption date?

I guess that is the point, do we all not understand at this point that it is all
fake.

Yeah , pretty much. If there was any doubt, the world realizes it is all a big ponzi scheme right now. But like all ponzis, once you recognze its a ponzi and all of you will lose, it behooves you to pawn it off on someone else - in this case the next generation (who will then have their own 2008 minute whereupon [unless someone calls their bluff] they will pawn that ponzi on to the next generation.

A large group of people being "poor" while an individual person is "rich" when
ALL of the credit money ever created is fake is pretty rediculous.

At the end of the day, money is just a representation of resources, (be them natural, political, or otherwise). In 2008, the worlds pool of bullshit was drained, and we were all exposed as swimming naked. Still, we, here in the US were still recognized as being the biggest, strongest, pack of grenades across its chest... So when we said "why dont we re-fill this pool, and lets all pretend it didnt happen" everyone else, recognized how powerless they were they nodded in agreement.

It wont always be this way. Eventually China or someone else will be big enough to call the shots. Im just not so sure that is going to happen while I happen to be on this planet.

133 CDon 2013 Jan 31, 10:47am