patrick.net

I definitely learned a lot about housing and construction over the past year or so.

On the other hand, significant market movements like this one provide investment opportunities for those who have a sound game plan.

New home sale prices are down for the second month now:

http://tinyurl.com/7hob7

fyi, SactoQt just posted a nice one: "The Sky is Falling"

No enthusiastic posts so far from Face Reality, Fake P, MP, MerrillClient or Jack??
What gives....?

I think Chinese benefits from the boom have been real, but US benefits have been more psychological and “on paper” and are more difficult to sustain.

Totally agree with you, Dipanjan. I keep hearing a common rationale among bulls that goes something like: "Who cares about the saving's rate falling to zero or over-leveraged house buyers? China/asia is doing our 'saving' for us and passing the profits back to us in the form of low rates & unlimited credit."

My feeling is, as long as this game suits them, they'll continue to buy vast quantities of T-Bills & MBSs. When the day comes they don't want to play anymore (or find better a ROI elsewhere), there will be hell to pay in the U.S.

That article is indeed informative, but hardly supports the premise of the bears.

No, it is only a non-confirmation to the bull's premise.

If this has been a grand master plan of China be very afraid. I remember The Art of War mentioning something about not strengthening one's adversary...

@MerrillClient,

I've recently re-read and reconsidered what I said in the End Game thread. While I stand by the substance of what I said, I realize I came off as rather nasty and combative ("overheated" as you say). For that I apologize. I don't want anyone (other than trolls) not to feel welcome to post their honest opinions here. The input from many of the bulls here has helped to elevate the debate and sharpen everyone's arguments.

Unfortunately, you managed to touch one of my rawest nerves and got the brunt of my fury. I see generational selfishness/entitlement as something that is very prevalent among baby boomers (though not universal). And I truly see a double standard among many who wish to protect laws like prop. 13 or Urban Boundary Limit laws. Yes, these laws were originally passed in the name of the environment or helping elderly people (similar to the way the Lottery was touted as a boost for education funding). What I think they've really done (and we no doubt disagree here) is to interfere with supply and free market forces and to artificially drive up the cost of housing --and property taxes, too.

MC, HARM, we can just get along fine. We are all peaceable people.

Hmmm... maybe a new thread idea?

NIMBY laws that artifically limit housing supply and drive California's RE prices permanently much higher, even ignoring the effects of the current speculative bubble. Are they a form of generational economic warfare --Boomers vs. their children & grandchildren-- or just bad policy spawned by ecological & tax revolt activism?

HARM, it is all class warfare. There is nothing new. What are you going to do about it?

What are you going to do about it?

Great question to end the thread with.

I don't know --organize a "repeal Prop. 13" & UBL law petition drive? A huge obstacle for any such drive is that most of the public believes these laws are "helping" them (yeah --helping young families into the poorhouse).

I don’t know –organize a “repeal Prop. 13″ & UBL law petition drive? A huge obstacle for any such drive is that most of the public believes these laws are “helping” them (yeah –helping young families into the poorhouse).

HARM, it is almost impossible to go against the political thrust. You really need to rally another powerful interest group on your side, if it exists at all. Are the people being HARM'd (sorry, cannot resist) politically active enough?

Veritas, temporary benefits bring nothing to the society as a whole but complacency.

I love Donald Kohn's quote: complacency would be ill-advised.

I'm not sure I've seen the benefits to schools here in Sacto. So many areas have been built up so quickly, that schools are not being built quick enough. In Elk Grove, kids have been bussed out of their neighborhoods becauce there isn't a schoold to go to. In Natomas, they forgot to build a fire station. It wasn't until a house burned down that they went "oops." The city is now housing the firefighters in a neighborhood house with large tents to keep the trucks in until the fire station is built.

Birhan -- I noticed you had nearly identical multiple posts, so I deleted the earlier two (drafts?) and kept the last one.

I’m not sure I’ve seen the benefits to schools here in Sacto.

Agreed -- and I think Prop. 13 is a big factor in the RE windfall not benefitting the schools. Unrestricted illegal immigration is another. See the "NIMBY Laws and California Housing Prices" thread for more on that.

@MP:
Face Reality, Fake P & MerrillClient are "bearish"?

(sorry guys --after all, this thread is named "One for the Bulls")

MP - even some of the bears on this list own houses. I do and still believe there is a bubble. It may not also stop me buying again (larger house) from necessity.

MP - I know exactly what I think of that last post but am too polite to say it in front company. And now I think I should stop feeding the troll:)

Jack, some people are ALWAYS ON TRANSMIT NEVER ON RECEIVE. I guess there's just nothing we can do to change that.