| Author |
Previous Topic | Next Topic |
|
peter
3191 Posts |
 Posted - 02/05/2008 : 4:40:09 PM
|
Recession is here - economists
A weak report about the services sector has caused some experts to declare that the economy has already entered downturn.
By Chris Isidore, CNNMoney.com senior writer
February 5 2008: 12:47 PM EST
NEW YORK (CNNMoney.com) -- A growing number of top economists believe that the U.S. economy has now toppled into recession.
Alarm bells were set off Tuesday by a grim report on service businesses, which make up the majority of the U.S. economy.
The Institute of Supply Management said that activity in the service sector declined for the first time in nearly five years. This report also indicated that employers are cutting staff.
The survey covers the retail, transportation and health care industries as well as hard hit areas such as finance, real estate and construction.
Some economists argued that the normally low-profile ISM services reading, coupled with the government's report Friday showing the first monthly net loss in jobs in more than four years, is proof that recession is now a reality.
http://money.cnn.com/2008/02/05/news/economy/recession/index.htm |
|
propertylender.c
762 Posts |
Posted - 02/05/2008 : 6:35:58 PM
|
It has been here the last 3 months.
Question(s) is how bad and how long. |
|
|
RodneyLO
769 Posts |
Posted - 02/05/2008 : 6:39:32 PM
|
Great!
Here's Peter with his usual negative B-U-L-L-S-H-I-T!!! |
|
|
darkstar
13781 Posts |
Posted - 02/05/2008 : 6:49:13 PM
|
| So we're in a recession, who cares?...I wouldn't even know it if you didn't tell us and it knowing won't change anything...If this is a recession, I hope we never recover as everybody I've been talking to agrees business has picked up, especially the quality of the applicants, why do you continue to dwell on the doom and gloom?...I just don't see the purpose as it has to weigh on you psychologically... |
|
|
bmoran
882 Posts |
Posted - 02/05/2008 : 6:59:04 PM
|
A "recession" is defined by either 2 quarters or 2 months of negative GDP I forget which one.
We havent had and yet.
I guess if you keep predicting it it will come sooner or later
BTW a recession will lead to even lower interest rates |
|
|
homebroker@sbcgl
1510 Posts |
Posted - 02/05/2008 : 7:05:29 PM
|
| Thanks Peter, I don't find this negative at all, but reality. Those in denial of their current market are in for a surprise. This is going to be a recession no doubt about that, lets just home we avoid a depression! |
|
|
Scrooge McDuck
6556 Posts |
Posted - 02/05/2008 : 7:15:14 PM
|
durable goods are up. farming and farming equipment are way up. oil is dropping daily and will be at $75 before we know it.
i read too much of this stuff, and i know more and more that the worst is here right now. the sun is still out, i think i took 24 apps today16 of which would be loans, if they werent savvy enough to comparison shop. i have 10 preapprovals out shopping for their next house. and now i also have some great ads for craigslist.
i think weve all met people like peter before. theyre just this way and cant get over themselves. i read an article that said that america is trying its hardest to talk itself into a recession. this is all the media. |
|
|
darkstar
13781 Posts |
Posted - 02/05/2008 : 7:23:37 PM
|
Brian, it's not denial at all, OUR market has improved a lot recently, being in a recession, or knowing it, doesn't change that, life is good and so is business, again, if this is a bad economy, I hope we never recover, loans are flying!!!!!!!
|
|
|
toddblue
974 Posts |
Posted - 02/05/2008 : 7:46:43 PM
|
| Peter is the Bernie Lootz of the BO. |
|
|
Scrooge McDuck
6556 Posts |
Posted - 02/05/2008 : 7:49:52 PM
|
| no, hes the debbie downer of the BO |
|
|
johnhoefer
384 Posts |
Posted - 02/05/2008 : 8:03:01 PM
|
| Negative growth in GDP for two consecutive quarters is considered a recession. Considering 4Q07 was at 0.6%, it is not possible for us to be in a recession, unless it is later revised downward to a negative figure and 1Q08 is also a negative quarter. As an appraiser I am definitely feeling it in the commercial market, but whatever. Since 1982 we have had 5 negative quarters and 95+ positive quarters. In the 25 years prior to Reagan 33% of the quarters were negative. That is a big change and we are lucky to be in America no matter what the state of the economy. By the time the news hits, we are usually on our way out of the woods, so I like hearing it, to me it makes the light at the end of the tunnel that much closer. |
|
|
johnhoefer
384 Posts |
Posted - 02/05/2008 : 8:05:19 PM
|
| Don't forget you are quoting the Communist News Network, not that I like Fox much better as it is more of a news magazine channel with news breaks. So consider the source. CNN sucks. I am sure it was followed by glowing coverage of the Democratic nominees. |
|
|
propertylender.c
762 Posts |
Posted - 02/05/2008 : 8:14:01 PM
|
quote:
Originally posted by RodneyLO
Great!
Here's Peter with his usual negative B-U-L-L-S-H-I-T!!!
Today the NYSE down 370
Tokyo down well over 500
some B-U-L-L-S-H-I-T!!! |
|
|
propertylender.c
762 Posts |
Posted - 02/05/2008 : 8:16:06 PM
|
quote:
Originally posted by bmoran
A "recession" is defined by either 2 quarters or 2 months of negative GDP I forget which one.
We havent had and yet.
I guess if you keep predicting it it will come sooner or later
BTW a recession will lead to even lower interest rates
Yeah, in the 90's, they lowered interest rates but most were not able to refinance because they were upside down. |
|
|
hherrm
1201 Posts |
Posted - 02/05/2008 : 8:26:56 PM
|
quote:
Originally posted by johnhoefer
. By the time the news hits, we are usually on our way out of the woods, so I like hearing it, to me it makes the light at the end of the tunnel that much closer.
I really have to laugh about this one. It is so true, by the time the news comes out we are almost over it.
The same with the news on lowest rates in so many years, by the time it becomes news, the rates went up already. |
|
|
homebroker@sbcgl
1510 Posts |
Posted - 02/05/2008 : 8:37:16 PM
|
Thank goodness for the REFI boom right now, I like to see the positive and negative. Seems when the Largest Mortgage company in the nation cannot afford to keep their door open we might be having some probelms. I like to be prepared for the worst, its much like throwing a foot ball, you aim further than you wish to throw.
quote:
Originally posted by darkstar
Brian, it's not denial at all, OUR market has improved a lot recently, being in a recession, or knowing it, doesn't change that, life is good and so is business, again, if this is a bad economy, I hope we never recover, loans are flying!!!!!!!
|
|
|
peter
3191 Posts |
Posted - 02/05/2008 : 8:38:25 PM
|
First of all, I posted the news as they came out on CNN
without giving my opinion whether I agree with the news or not.
It apparently rattled some people who cannot stand realities!
Yes, our business is good as the recession is coming along
if there is already one. Fixed rates have come down and
refi business is very good, but not as good as the refi business
in the early 2000's because of lack of qualified borrowers with
sufficient equity due to declined home values. Also, the business
is not as good as in the early 2000's because of the lack of
certain loan programs such as stated income 2nds to 90% cltv
or better, or stated income jumbos over 80%. However, I see
a surge of interest in refinancing from A paper homeowners
with current loan balances less than 70% LTV because the fixed
rates are so low and when compared to 5/1 arm that they have
the gap is very narrow that they now want fixed rates.
Also, those who took the Option Arm products are now realizing
that they have to refinance out of the accrued interest trap
that they see on the monthly mortgage statements.
There is also a surge in the anxiety level of homeowners
that they must have more cash stashed aside as their helocs
are being frozen out by banks and CW, and that the refi cashout
is now the frenzy of the market.
"Every cloud has a silver lining" and the lining is in
the good business that we're enjoying right now.
Peter |
|
|
johnhoefer
384 Posts |
Posted - 02/05/2008 : 8:41:40 PM
|
Yes, the mainstream media is a sociological trailing indicator. We have been worried for months while in the 0.6% economy, things are looking up in many areas with costs lowering due to expected lower demand. Also, interest rates are low and we have significantly more creative financing than in the 90's along with a more robust secondary market with more players. The banks have the money to lend, but the buyers in the secondary market are the ones with the jitters holding things up since they are still cringing from being left holding the subprime hot potato.
But the LTV problem stated before is certainly going to be an issue for many who cannot afford the payments to ride out the storm, but that was the case before anyway with the high interest rates, so I don't see how it worsens it much. But it admitedly does not alleviate the housing market issues as much as hoped. But low interest rates effect all sectors or the economy, not just housing. So overall it is a good, and will hopefully allow the labor market stable to rising income and near full employment, that is good for the housing sector as well. |
|
|
propertylender.c
762 Posts |
Posted - 02/05/2008 : 8:43:06 PM
|
quote:
Originally posted by johnhoefer
Don't forget you are quoting the Communist News Network, not that I like Fox much better as it is more of a news magazine channel with news breaks. So consider the source. CNN sucks. I am sure it was followed by glowing coverage of the Democratic nominees.
I thought it was the
Clinton News Network
Guess I was wrong. |
|
|
bmoran
882 Posts |
Posted - 02/05/2008 : 8:49:35 PM
|
quote:
Originally posted by johnhoefer
Negative growth in GDP for two consecutive quarters is considered a recession. Considering 4Q07 was at 0.6%, it is not possible for us to be in a recession, unless it is later revised downward to a negative figure and 1Q08 is also a negative quarter. As an appraiser I am definitely feeling it in the commercial market, but whatever. Since 1982 we have had 5 negative quarters and 95+ positive quarters. In the 25 years prior to Reagan 33% of the quarters were negative. That is a big change and we are lucky to be in America no matter what the state of the economy. By the time the news hits, we are usually on our way out of the woods, so I like hearing it, to me it makes the light at the end of the tunnel that much closer.
EXCELLENT !!!
Also note that whether you like it or not, the majority of the news in this country comes from a leftist slant. They are committed to talking down the economy and America in general most "experts" on the news have been predicitng doom and gloom for months. Will we have a recession I am sure at some point we will , you cant go up up up.
Mark my words once the election takes place and if a democrat gets in office which it looks like will happen, you will no longer hear about a "possible" recession.
The way you no longer hear anything about the war, because things are improving there, no need to report that.
If you don't beleive me about the news, then read Bernard Goldbergs book "Bias", there is definately a left slant, to but it mildly. Thats not an obervation thats a fact, look at who controls the media and our universitys and hollywood. Thats why Fox gets blasted so much, because they dare to offer up conservatives views. The left calls itself progressive but doesnt like an arena of ideas or opposing view points. |
|
|
homebroker@sbcgl
1510 Posts |
Posted - 02/05/2008 : 9:01:26 PM
|
I agree the Media sucks, fact is many homeowners will be former homeowners, and mortgage companies are not closing their doors because of what CNN said last night, they have buy backs and limited programs. Prices were 9x+ income in many areas, 2.8% is healthy give or take a little, This is a much needed correction that will lead to a healthy market. We just have to work 3x a hard to make the same money as 2006, no problems just a little more sweat. I like working hard, it makes the days go by quicker! But all these positive only people that say they did not notice a thing, come on, they mean not one company they send loans to closed, and not one borrower they priced out a loan for that would fly a year ago was send to the credit repair pipeline, not to mention the LTV problems in deflating markets. If your in this business you have felt the issues at hand one way or another, they are even feeling the shock of our market in Norway, Italy, Germany you name it!
quote:
Originally posted by bmoran
quote:
Originally posted by johnhoefer
Negative growth in GDP for two consecutive quarters is considered a recession. Considering 4Q07 was at 0.6%, it is not possible for us to be in a recession, unless it is later revised downward to a negative figure and 1Q08 is also a negative quarter. As an appraiser I am definitely feeling it in the commercial market, but whatever. Since 1982 we have had 5 negative quarters and 95+ positive quarters. In the 25 years prior to Reagan 33% of the quarters were negative. That is a big change and we are lucky to be in America no matter what the state of the economy. By the time the news hits, we are usually on our way out of the woods, so I like hearing it, to me it makes the light at the end of the tunnel that much closer.
EXCELLENT !!!
Also note that whether you like it or not, the majority of the news in this country comes from a leftist slant. They are committed to talking down the economy and America in general most "experts" on the news have been predicitng doom and gloom for months. Will we have a recession I am sure at some point we will , you cant go up up up.
Mark my words once the election takes place and if a democrat gets in office which it looks like will happen, you will no longer hear about a "possible" recession.
The way you no longer hear anything about the war, because things are improving there, no need to report that.
If you don't beleive me about the news, then read Bernard Goldbergs book "Bias", there is definately a left slant, to but it mildly. Thats not an obervation thats a fact, look at who controls the media and our universitys and hollywood. Thats why Fox gets blasted so much, because they dare to offer up conservatives views. The left calls itself progressive but doesnt like an arena of ideas or opposing view points.
|
|
|
johnhoefer
384 Posts |
Posted - 02/05/2008 : 9:19:07 PM
|
I have definitely experienced the decline. Commercial appraisal volume is down 40% compared to last year on a monthly basis anyway and prices have fallen by about 10-15%. I just moved to a place that costs me 2/3 my former rent and I have tighted the belt quite a bit.
I certianly learned my lesson about living lean no matter what the circumstances, live a balanced life and enjoy but not require the excesses to be happy. That is the road I am on right now and the downturn made me realize a great deal about how I live, what I am doing to be successful etc. I am 29 and got into the real estate market as it was ramping up and I was not as smart with my money as I should have been. But I am positive and looking forward to transferring into the small commercial lending area and making bigger bucks and doing more than becoming the ever more efficient appriasal machine.
Fankly, this downturn has been the best thing for me and regardless of the news, I am certainly positive. Maybe I have just been listing to too much Brian Tracy and Jim Rohn audiobooks recently though. Maybe I should be sad and aprehensive. |
|
|
peter
3191 Posts |
Posted - 02/05/2008 : 9:30:41 PM
|
Brian wrote:
"This is a much needed correction that will lead to a healthy market. We just have to work 3x a hard to make the same money ..."
I see a healthy correction taking place in the real estate sales
market. In a Century 21 office where I work as an in-house L/O,
there are young yuppies with good jobs and qualifying incomes
now looking for their first time condos in the ranges of
$250,000 to $350,000 as they could not have afforded this price
level in 2007. Now that prices have come down and many REOs
go begging for buyers, and there are first-time buyers coming
out gradually and slowly with 5% down to buy their first condos
as they break away from being renters. I think if the home prices
go down by another 20% or even 30% in the next 24 months, the
correction will even become healthier as the losers will be
replaced by the winners. But the purchase and refi transactions
will increase as we watch the real estate onslaught unfolding
into winners and losers of homes.
And the bottom feeder investors will enter the market once
rates have come down and money is cheap enough to buy up
good properties at 40 cents to a dollar. If they are not from
within the U.S., they will be coming from the land far away.
Peter
|
|
|
bmoran
882 Posts |
Posted - 02/05/2008 : 9:49:40 PM
|
quote:
Originally posted by johnhoefer
I have definitely experienced the decline. Commercial appraisal volume is down 40% compared to last year on a monthly basis anyway and prices have fallen by about 10-15%. I just moved to a place that costs me 2/3 my former rent and I have tighted the belt quite a bit.
I certianly learned my lesson about living lean no matter what the circumstances, live a balanced life and enjoy but not require the excesses to be happy. That is the road I am on right now and the downturn made me realize a great deal about how I live, what I am doing to be successful etc. I am 29 and got into the real estate market as it was ramping up and I was not as smart with my money as I should have been. But I am positive and looking forward to transferring into the small commercial lending area and making bigger bucks and doing more than becoming the ever more efficient appriasal machine.
Fankly, this downturn has been the best thing for me and regardless of the news, I am certainly positive. Maybe I have just been listing to too much Brian Tracy and Jim Rohn audiobooks recently though. Maybe I should be sad and aprehensive.
Thats awesome John, maybe thats why I am usually more optimistic then others. Being alot older the you and probably most other posters, i have seen downturns before some self inflicted, there is always reasons for things and lessons to be learned.
Many here dont know business was like in the early 90's, markets need corrections, adjustments or whatever you want to call them. Like Peter said and i have been saying all along, everyone complained when prices were too high, now they are too low. There is ALWAYS a reason to be pesimistic.
|
|
|
johnhoefer
384 Posts |
Posted - 02/05/2008 : 11:13:49 PM
|
True, there is always a reason to be pesimistic and corrections are normal and needed.
You work in the building next to where I got my start. I worked at Abergel and Associates at 24009 Ventura Blvd for my first year in apprasal. Like most kids of my generation, I thought I was supposed to be successful right out of college and hopped around for 5k extra and promises every couple years. They are great guys and excellent appraisers. |
|
|
darkstar
13781 Posts |
Posted - 02/06/2008 : 12:14:20 AM
|
>>> True, there is always a reason to be pesimistic
Really?...You could never convince me of that...
This is a great market and if other people, companies or governments can't manage their business and cause grief for themselves and others, I don't care...All I care about is my family's future and we have that handled because I didn't spend last year boohooing about how bad things were, I spent my time making myself recession proof, as many did...This market is such last years news, get over it already... |
|
|
johnhoefer
384 Posts |
Posted - 02/06/2008 : 12:16:28 AM
|
| There is always reason to be pessimistic as in it is a choice of point of view. Glass half full or half empty. Read above my post for clarification. |
|
|
kchinn68
100 Posts |
Posted - 02/06/2008 : 12:17:12 AM
|
| No Solution Just Pollution |
|
|
darkstar
13781 Posts |
Posted - 02/06/2008 : 12:22:07 AM
|
| So if there is a pos and a neg, you would consciously choose the neg?...That makes no sense to me, why not, "what can I do to get that glass full?!" or just "I'm happy it's that full" not, (in my best Eeyore voice)"oh my, the glass is almost empty", how do people learn that way of thinking?... |
|
|
kchinn68
100 Posts |
Posted - 02/06/2008 : 12:32:25 AM
|
| Because there really is no solution...just pollution...the Federal Reserve controls the currency...the Government is a corporation... Life 101...I am not being a pessimist...I am just a non-optimist. No matter how many people on this particular topic have replied with some kind of political fix or economist point of view or whatever CNN says - whocares - it's just news - like trading currencies on the FOREX market - traders who trade the news, loose. I am just glad for the time being that loans are picking up again. It's been tough on all of us these last few months. |
|
|
TonyInLosAngeles
150 Posts |
Posted - 02/06/2008 : 01:10:59 AM
|
quote:
Originally posted by bmoran
quote:
Originally posted by johnhoefer
Negative growth in GDP for two consecutive quarters is considered a recession. Considering 4Q07 was at 0.6%, it is not possible for us to be in a recession, unless it is later revised downward to a negative figure and 1Q08 is also a negative quarter. As an appraiser I am definitely feeling it in the commercial market, but whatever. Since 1982 we have had 5 negative quarters and 95+ positive quarters. In the 25 years prior to Reagan 33% of the quarters were negative. That is a big change and we are lucky to be in America no matter what the state of the economy. By the time the news hits, we are usually on our way out of the woods, so I like hearing it, to me it makes the light at the end of the tunnel that much closer.
EXCELLENT !!!
Also note that whether you like it or not, the majority of the news in this country comes from a leftist slant. They are committed to talking down the economy and America in general most "experts" on the news have been predicitng doom and gloom for months. Will we have a recession I am sure at some point we will , you cant go up up up.
Mark my words once the election takes place and if a democrat gets in office which it looks like will happen, you will no longer hear about a "possible" recession.
The way you no longer hear anything about the war, because things are improving there, no need to report that.
If you don't beleive me about the news, then read Bernard Goldbergs book "Bias", there is definately a left slant, to but it mildly. Thats not an obervation thats a fact, look at who controls the media and our universitys and hollywood. Thats why Fox gets blasted so much, because they dare to offer up conservatives views. The left calls itself progressive but doesnt like an arena of ideas or opposing view points.
What horse ****. The media is loyal to neither the left nor the right, they have their own self serving agenda. And Fox gets blasted for conservative views??? Sorry to break it to you, but Fox is one of the LEAST credible news organizations regardless of where they stand on the political spectrum. Horse **** comes from both sides.
This is what happens when sales people turn into economists. It's rah rah rah sis boom bah, no no don't want to hear bad news only the good stuff. Fact one, we are in a recession, all signs point to it. This country has never seen a run up in credit like we had in the past 7 years and there is a price to pay. Fact two, we've had TWO rate cuts back to back in two weeks, this is unprecedented. The Feds and banks are running scared, and of all people WE should know this since this is our business.
And posting economic news doesn't mean the guy is being negative, he's sharing information, good or bad it's out there. You more than demonstrate your lack of intelligence or ability to handle news if all you can simply do is blast the messenger.
Our business model is changing, times are changing, modify your business accordingly. |
|
|
darkstar
13781 Posts |
Posted - 02/06/2008 : 01:44:04 AM
|
>>>>The Feds and banks are running scared, and of all people WE should know this since this is our business.
The borrowers aren't and that's all that matters, plenty of products for plenty of borrowers... |
|
|
johnhoefer
384 Posts |
Posted - 02/06/2008 : 02:11:23 AM
|
First, Darkstar, I think you need to reread my posts. You are not getting that we are on the same side of the point.
Tony:
In the case of shooting the messenger, I think it can reasonably be assummed there is an implicit point behind a posting of economic doom and gloom. It is a choice to post, its not like this place is normally non-politically/economically charged and this post and subsequent reaction is from out of the blue and out of the ordinary. Guess we got on a roll there, apologies to peter on assuming first. Adding personal notes in a sentence or two would be helpful.
Secondly Tony I am not in sales, just yet anyway, I have a business degree in finance and am commercial appraiser. I don't feel superior/inferior when talking economics to anyone. It is a subject of discussion for responsible citizens in a society where currently the "people's hope" for our open presidential seat will be that change will occur. Sales people are the perfect people to become economists anyway just like they often become CEO's, they are the first people to feel the drop in economic growth. Maybe you look down on your profession Tony.
And yes the media is completely liberal and that is obvious. Go to www.mrc.org. Also, I called Fox News a news magazine show with news breaks and you construed that as complementary. This is getting boring.
"Our business model is changing, times are changing, modify your business accordingly." - How about me changing careers Tony, is that enough of a modification? Please read my previous posts and refrain from insulting other people's intelligence. |
|
|
Mandyvilla
2039 Posts |
Posted - 02/06/2008 : 06:01:58 AM
|
CNBC just had their table of experts and some stats that came out by Ludlow (Larry?), 85% of the American people believe we are in or going into a serious recession. Yet when the same people are asked if they are better off than they were a year ago, almost 100% of this group said yes, they were better off. They called it a rare anomale.
Steve Forbes attributed it to poor or lack of leadership (lame duck) and that once the public perception reverses, all will be okay.
Hmmm, if we believe that, that will bring back the imploded companies? In any event......this market is a money-maker. If you aren't making it, move on out because you may not ever make it. Remember how you were trained for more reasons than one. This is also one time to make sure you are doing your job correctly - probably too late for action from big bro, but many companies have to prove they now know how to flex muscle - it's not time to be stupid.
In any event, go get them, work like you never have before.....I do believe a wave is coming. Stock up your canned goods, toilet paper, pet food and bottled water now.......you may not get out for weeks, or if we are lucky, months. |
|
|
homer5
240 Posts |
Posted - 02/06/2008 : 07:23:04 AM
|
Here is the acid test on the economy. Forget past recessions because this one is different.
Have the credit/debt markets been repaired? Are mortgage and other debt paper finding buyers? Can lenders securitized their loans?
http://calculatedrisk.blogspot.com/2008/02/cdo-market-almost-frozen.html
The answer is no. As long as the answer is no, we are in for very tough times both in this business and the economy overall.
Due to products taken off the market, entire classes of real estate buyers are no more. This together with the foreclosure explosion will keep downward pressure on real estate prices.
The consumer cannot lead us out of this recession. The consumer is tapped out, no savings to spend, no home equity to spend (even if they have equity), credit cards are tapped out or being pulled by companies and new credit card accounts are harder to qualify for as are installment loans. There goes the consumer's money to spend. He has none and there goes 70% of GDP.
Are you aware that credit standards on all types of loans are being tightened at a break neck and historic pace? Do you understand what that does to the engine of our economy, the consumer?
http://www.marketwatch.com/news/story/economic-report-banks-putting-squeeze/story.aspx?guid=%7B7BE04142%2D569B%2D4889%2DAC74%2D4F30FA124B59%7D&dist=hplatest[/irl]
Do you realize our largest banks have negative reserve positions? They are borrowing furiously to maintain reserves. Do you realize if they were forced to buy back or mark to market all of the bad mortgage paper out there that they would be insolvent?
http://globaleconomicanalysis.blogspot.com/2008/01/bank-reserves-go-negative.html
Do you realize that we are only at the beginning of this debacle?
Do your realize rate cuts and fiscal stimulus are not the answers to getting out of this recession? That the answer is to rebuild confidence in the debt markets.
Are you aware of the parallels among today's economy and that of the early 1930's?
quote:
In the face of bad loans and worsening future prospects, banks became more conservative in lending money. They built up their capital reserves, which intensified the deflationary pressures. The vicious cycle developed, and the downward spiral accelerated. This kind of self-aggravating process may have turned a 1930 recession into a 1933 depression.
http://en.wikipedia.org/wiki/Great_Depression_in_the_United_States
It's been said that "a recession is a normal part of the business cycle, but it takes a major policy mistake by a government or central bank to create a depression."
Is the big mistake being made today the focus on monetary and fiscal stimulus rather than the systemic breakdown of our credit markets?
Peter is going to have the opportunity to post many, many of these articles in the days and weeks ahead. I don't care if business is good for some you, it's picked up some for us too, but we have major problems to contend with. The wrong solutions are just making the situation worse. It's better to enter this perilous time with eyes wide open even if it means a discussing and allowing negativity to enter our consciousness.
Looking adversity right in the eyes has always worked well for me as unpleasant as it may be. |
|
|
TonyInLosAngeles
150 Posts |
Posted - 02/06/2008 : 07:47:03 AM
|
quote:
Originally posted by johnhoefer
First, Darkstar, I think you need to reread my posts. You are not getting that we are on the same side of the point.
Tony:
In the case of shooting the messenger, I think it can reasonably be assummed there is an implicit point behind a posting of economic doom and gloom. It is a choice to post, its not like this place is normally non-politically/economically charged and this post and subsequent reaction is from out of the blue and out of the ordinary. Guess we got on a roll there, apologies to peter on assuming first. Adding personal notes in a sentence or two would be helpful.
Secondly Tony I am not in sales, just yet anyway, I have a business degree in finance and am commercial appraiser. I don't feel superior/inferior when talking economics to anyone. It is a subject of discussion for responsible citizens in a society where currently the "people's hope" for our open presidential seat will be that change will occur. Sales people are the perfect people to become economists anyway just like they often become CEO's, they are the first people to feel the drop in economic growth. Maybe you look down on your profession Tony.
And yes the media is completely liberal and that is obvious. Go to www.mrc.org. Also, I called Fox News a news magazine show with news breaks and you construed that as complementary. This is getting boring.
"Our business model is changing, times are changing, modify your business accordingly." - How about me changing careers Tony, is that enough of a modification? Please read my previous posts and refrain from insulting other people's intelligence.
I like how you don't need to feel superior yet add that little quip about having a degree in business. Nice to know you have a degree in business, as do I. In fact, both my B.S. and MBA are in business, so if we're having a cock measuring contest, I guess mine is longer and thicker.
Nope, I don't look down on the profession, just some of the idiots running around doing what we do, and there are plenty of those. So where did you get the assumption that I looked down on this career? But then again you have a degree in business so that must make you perceptive as well.
Liberal media? This is an antiquated term. And thanks for the link to that website, I can see that it is truly unbiased. If slapping on .org and calling it a media watchdog is all it takes to convince you that it's unbiased, then I guess you're the same type of person that would take a post op tranny and call him a woman.
This post was directed to my fellow LO's and Brokers. The fact that you're an appraiser, big whoop, you depend on us to bring you the business, so let's be real about who's really on the front line of this business, cause Mr. Appraiser/I got a business degree, it ain't you. |
|
|
darkstar
13781 Posts |
Posted - 02/06/2008 : 08:03:48 AM
|
| You keep wasting your time "allowing negativity to enter your consciousness" and dealing with the major problems you seem to be facing, we'll stay focused on the mass amounts of loans we can barely control and how we're going to grow our business over the next year...Who's focus do you think will carry them further?... |
|
|
propertylender.c
762 Posts |
Posted - 02/06/2008 : 08:10:25 AM
|
quote:
Originally posted by peter
Brian wrote:
"This is a much needed correction that will lead to a healthy market. We just have to work 3x a hard to make the same money ..."
I see a healthy correction taking place in the real estate sales
market. In a Century 21 office where I work as an in-house L/O,
there are young yuppies with good jobs and qualifying incomes
now looking for their first time condos in the ranges of
$250,000 to $350,000 as they could not have afforded this price
level in 2007. Now that prices have come down and many REOs
go begging for buyers, and there are first-time buyers coming
out gradually and slowly with 5% down to buy their first condos
as they break away from being renters. I think if the home prices
go down by another 20% or even 30% in the next 24 months, the
correction will even become healthier as the losers will be
replaced by the winners. But the purchase and refi transactions
will increase as we watch the real estate onslaught unfolding
into winners and losers of homes.
And the bottom feeder investors will enter the market once
rates have come down and money is cheap enough to buy up
good properties at 40 cents to a dollar. If they are not from
within the U.S., they will be coming from the land far away.
Peter
Peter, a foreclosure just came into my area (Glendale, CA)2 days ago:
3 plus 3 with attached garage townhouse and 1,450 sq. ft. priced at $349,500 with the following comment (BRING ANY OFFER).
By comparison, this should have been priced at around $450K.
The bank priced it well below market it is will kill the surrounding values.
I am showing it today.
Bottom line is that it is falling a lot faster than most expect, except of many idiot real estate agents (in my area) who still don't get it.
I understand if the overpriced listing would sell, buy they are not. |
|
|
homer5
240 Posts |
Posted - 02/06/2008 : 08:13:39 AM
|
There is a difference between focus and awareness. My focus is always on the objective at hand. My awareness is aimed at all things that may affect my objective. To be unaware of the negative forces at work today is in my opinion, foolhardy.
To use a football metaphor, business is like being a linebacker. A linebacker reads the play and reacts to it accordingly. The linebacker could not react properly if he misreads the play or doesn't see it all. |
|
|
darkstar
13781 Posts |
Posted - 02/06/2008 : 08:15:05 AM
|
>>>I understand if the overpriced listing would sell, buy they are not.
Use BofA, they'll use their own AVM which can get those overpriced values done for you, even today! LOL |
|
|
darkstar
13781 Posts |
Posted - 02/06/2008 : 08:30:38 AM
|
>>>To be unaware of the negative forces at work today is in my opinion, foolhardy.
Agree, but who can possibly be "unaware" here, we have Peter? LOL I'm aware of them, they just don't concern me any more than what I'm going to eat for lunch today, business is better than ever(loan wise), I can't even relate to people being slow... |
|
|
homer5
240 Posts |
Posted - 02/06/2008 : 08:36:29 AM
|
quote:
Originally posted by darkstar
>>>To be unaware of the negative forces at work today is in my opinion, foolhardy.
Agree, but who can possibly be "unaware" here, we have Peter?
LOL |
|
|
yldspread
359 Posts |
Posted - 02/06/2008 : 08:46:42 AM
|
Our economy is so complex and there are so many variables that is really hard to determine when you are in a recession. It is usually 6 months into it when economist can say that.
I think we are like in the 4 month and the rate cuts are just going to make it deeper. |
|
|
mudshark
3663 Posts |
Posted - 02/06/2008 : 08:49:33 AM
|
The bottom line is that things are getting more realistic as we wake up from the SubPrime dream that infected us all. People are buying houses to live in and pay off with actual down payments. Investors are buying for cash flow or to resell with actual enhancements to the properties. Manufacturing is starting to return as a weakened dollar, trade incentives and quality control issues bring the economy back to tangible goods instead of paper shuffling.
It's going to be very tight for a while as values continue their downward spiral and spec inventories are acquired by real owners. Some parts of the country are already close to bottoming as they've been going through this much longer than others.
Once our bottom hits, the more aggressive product and higher ltv/cltv will return as the investors that bailed earlier and are sitting on their cash will return. In the interim, work smarter and don't be afraid to kick a loser to the curb. The boiler rooms you competed against are no longer an issue.
|
|
|
Originate_This
196 Posts |
|
johnhoefer
384 Posts |
Posted - 02/06/2008 : 09:05:18 AM
|
quote:
Originally posted by TonyInLosAngeles
quote:
Originally posted by johnhoefer
First, Darkstar, I think you need to reread my posts. You are not getting that we are on the same side of the point.
Tony:
In the case of shooting the messenger, I think it can reasonably be assummed there is an implicit point behind a posting of economic doom and gloom. It is a choice to post, its not like this place is normally non-politically/economically charged and this post and subsequent reaction is from out of the blue and out of the ordinary. Guess we got on a roll there, apologies to peter on assuming first. Adding personal notes in a sentence or two would be helpful.
Secondly Tony I am not in sales, just yet anyway, I have a business degree in finance and am commercial appraiser. I don't feel superior/inferior when talking economics to anyone. It is a subject of discussion for responsible citizens in a society where currently the "people's hope" for our open presidential seat will be that change will occur. Sales people are the perfect people to become economists anyway just like they often become CEO's, they are the first people to feel the drop in economic growth. Maybe you look down on your profession Tony.
And yes the media is completely liberal and that is obvious. Go to www.mrc.org. Also, I called Fox News a news magazine show with news breaks and you construed that as complementary. This is getting boring.
"Our business model is changing, times are changing, modify your business accordingly." - How about me changing careers Tony, is that enough of a modification? Please read my previous posts and refrain from insulting other people's intelligence.
I like how you don't need to feel superior yet add that little quip about having a degree in business. Nice to know you have a degree in business, as do I. In fact, both my B.S. and MBA are in business, so if we're having a cock measuring contest, I guess mine is longer and thicker.
Nope, I don't look down on the profession, just some of the idiots running around doing what we do, and there are plenty of those. So where did you get the assumption that I looked down on this career? But then again you have a degree in business so that must make you perceptive as well.
Liberal media? This is an antiquated term. And thanks for the link to that website, I can see that it is truly unbiased. If slapping on .org and calling it a media watchdog is all it takes to convince you that it's unbiased, then I guess you're the same type of person that would take a post op tranny and call him a woman.
This post was directed to my fellow LO's and Brokers. The fact that you're an appraiser, big whoop, you depend on us to bring you the business, so let's be real about who's really on the front line of this business, cause Mr. Appraiser/I got a business degree, it ain't you.
Tony, please take some sort of reading comprehension class or do some exercises.
I said: "Sales people are the perfect people to become economists anyway just like they often become CEO's, they are the first people to feel the drop in economic growth. "
You Responded: The fact that you're an appraiser, big whoop, you depend on us to bring you the business, so let's be real about who's really on the front line of this business, cause Mr. Appraiser/I got a business degree, it ain't you.
Also, I didn't say mrc.org is unbiased. It can show you the obvious truth in the newcasters own words/deeds in print and on TV. What kind of point is "the liberal media is an antiquated term". Do you think there are any terms in our language older than the 90's? Do we have to throw those out too.
You are truly an idiot and I don't like you. Lets agree on that mutual feeling and stop wating our time typing. |
|
|
TonyInLosAngeles
150 Posts |
Posted - 02/06/2008 : 10:18:02 AM
|
| "You are truly | | | |
Search for: