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Friday, October 09, 1981

Monday Open Thread

This is your open thread for today. Please post random links and off-topic discussions here.

45 comments:

Matthew said...

Not normally a conspiracy theorist considering I work for the federal government, but does anyone think that the drop in oil prices seems to be related to the elections in November??? All of a sudden one month before elections oil drops to 60 a barrel?? Seems like a strange coincidence to me. I'm predicting after November oil to jump back up to around 70.

Secondly, my federal brethren are going to start cracking down bigtime on the major mortgage brokers, AKA WAMU, Countrywide etc. I believe we are starting to see the first wave of panic.

Lake Hills Renter said...

The drop in oil prices has been cancelled out by the big news story of the day -- Foley. Bring on the crackdown!

Matthew said...

True Lake hills, Foley has pretty much dwarfed everything in the news right now and probably will continue to do so until Nov.

mbarl said...

Finally the main stream meia has caught wind of the problem with liar loans! The following clip is a story that was done by CBS in San Francisco on a special called 30 minutes.
Could have gone a little deaper, but this is a great start!!!!

http://cbs5.com/30minutes/local_story_266005029.html

The Tim said...

Foley? Are you guys watching / listening to / reading the same news sources I am? Because as of last night, the Foley story became yesterday's garbage. It's all N. Korea, all the time now!

Speaking of which, considering that Seattle is the closest major US city to this nutjob and his new nukes, I wonder if the news will have any affect on the psychology of people around here, with respect to home purchasing.

synthetik said...

From Mish's global economic analysis,

"On the blog The Mess That Greenspan Made, Tim Iacono (speaking about gasoline prices and the above NY Times article writes about Friends in High Places

So, as far as conspiracy theories go, this is quite a good one. The motivation for the commodity index change and the impact on other energy prices will likely never be confirmed or corroborated, but it makes for an interesting story."


Friends in high places post on "Mess That Greenspan Made" about this conspiracy theory.

"A recent poll revealed that 42 percent of the respondents thought the White House had somehow manipulated the price of gasoline so that it would decrease before this fall's elections. They were only slightly outnumbered by the 53 percent who believed there to be no trickery involved."

Grivetti said...

I wonder if the news will have any affect on the psychology of people around here, with respect to home purchasing.

hahaha! I can see the headlines now, "Real Estate crash due to Seattle nuke-shadow, toxic loans go nuclear!!!"

redmondjp said...

Yes, Matthew, I am thinking along the exact same lines as you on this one (oil price manipulation). On Komo AM 1000 news this morning they reported that the price drop was due to a gasoline "oversupply" which they said should be over within the next month, after which prices should go up 15-20 cents per gallon. Hmmm, right after the elections . . . coincidence (or as Robert Stack said in Amazon Women on the Moon: Bullsh__ or not?)?

Interesting how Big Business telegraphs their intentions through the media ahead of time, such that it's not such a shock when their predictions come true--then they can say "we told you so."

synthetik said...

"I wonder if the news will have any affect on the psychology of people around here"

heh. now people will have a second reason to move into their basement. (first being they must rent out the actual house to pay their mortgage)

maybe I should start investing in MRE's

Eleua said...

matthew,

Do I see a conspiracy with the timing of the drop of oil and the Nov election.

Youbetcha! ...and I'm a Republican.

The GSCI the weighting of oil in its index, and all the hedge funds that track that index had to respond by selling a trainload of oil futures.

That is how "they" knew that gas would drop in price this far in advance. However, this won't last forever, and will revert back to the normal market level, adjusted for any supply output cuts in response to dropping prices.

End result? Higher prices.

The only question is if the changing of the GSCI was done at the behest of the Administration, or if the GSCI was changed to favor them without their direct involvement.

It's like Hollywood releasing a movie to time with the presidential election, or 99% of the stories that run on ABC/NBC/CBS/PBS/NYTimes/WashComPostduring election season.

I'm going to laugh my ass off when the oil prices spike in Nov-Dec.

Personally, I hope the news on 11/6 is how the GOP will hold both houses, and the news on 11/8 is how the Dems have the House and they will take the Senate if they can steal a close seat that has yet to be certified.

Matthew said...

Seattle actually does have one of the highest risks for a disaster to strike us...

Huge active fault line, Mt. Rainier and St. Helens, and we are probably the #1 target of N. Korea (along with Portland and San Fran). Mt. Rainier is long overdue to erupt.

Matthew said...

I should say we are the number 1 U.S. target of N. Korea.... Seoul and Tokyo being at the top overall

Eleua said...

If you want REAL manipulation, try this:

885 trading days since the last 2% down day on the S&P.

That is beyond a statistical fluke.

AnotherMIGuy said...

I can't believe we all missed yesterday's NYT story on Mercer Island:

http://www.nytimes.com/2006/10/08/realestate/08nati.html

A Rich Island Polishes Up Its Downtown
WHEN Deneen Clark began planning a move from San Francisco to Seattle last year, she scoured the area, looking for a neighborhood that felt right. High on her list was plenty of parking, good restaurants and an active nightlife. Although she was drawn to several areas within Seattle, she kept eyeing this island community, connected by bridges both to the city proper and to its suburbs on the east side of Lake Washington.

Still, no matter how many times Ms. Clark, a software consultant who travels frequently for work, looked at Mercer Island, she didn’t like what she saw.

“It looked boring and depressing,” said Ms. Clark, 40. “There wasn’t much of a nightlife, and you had to drive forever to get anywhere.”

Mercer Island is one of the wealthiest cities in Washington State, and the nation, for that matter. The median home price in August was $949,500, according to the Northwest Multiple Listing Service.

Among its 22,000 residents are Paul G. Allen, Microsoft’s co-founder. Multimillion-dollar homes, one of the state’s best school districts and hundreds of acres of parks and open space make the island one of the most coveted places to live in the region.

But its fashionable reputation does not extend to its downtown, where 1950’s-era strip malls sit amid acres of parking lots.

“I’ve heard people say that 10 to 15 years ago, you could roll a bowling ball down Main Street, and no one would notice,” said Rich Conrad, Mercer Island’s city manager.

...

Matthew said...

Eleua,

I have also wondered about the current run of the S&P. I watch Bloomberg t.v. in the morning and almost everyone sees the DOW and S&P gaining another 3-4 percent despite the indicators showing that the economy is slowing. It is eerily similiar to the market of 1999. There are VERY few bears out there, and the people that are bearish are being laughed at.

I was reading that while the housing market is a very small percentage of GDP, it has accounted for about 40 percent of our economic growth since 2001. But yet the people on Wall St. seemingly think that the real estate slowdown will have very little impact on the DOW and S&P. Am I missing something? This seems to defy logic to me.

Eleua said...

Am I missing something? This seems to defy logic to me.

You are not missing anything. The scads of fund managers all get paid based upon how they perform against each other. They are not stupid. They know their job is based upon staying in the game until it is over, lest they miss a big move.

The problem comes when it is time to go down, they will have a powerful urge to sell, and all sell at the same time.

Ruh-ro.

Repeat after me.

"It's all one trade."

Say this over and over again, until the markets make sense.

Housing, stocks, dollar, bonds, 401(k), Babyboom retirements...

It is all one trade.

It will also be one trade down.

Eleua said...

I guess what I am saying is the fundmanagers and the lumpeninvestoriat all believe they can leave Cinderella's ball at 23:59:59.99999.

Ain't going to happen, but many are goint to try.

Going down?

synthetik said...

Just as a question, am I off base with my comments on Rain City Guide?

If you post there, please be nice. Yes, I'm being baited, but why not point out hypocrisy when and where appropriate?

Matthew said...
This comment has been removed by a blog administrator.
synthetik said...

Oct. 9 (Bloomberg) -- Kara Homes Inc., a luxury builder in New Jersey that sells homes triple the average U.S. house size, filed for bankruptcy after discounts of as much as $246,000 and a year of mortgage payments failed to lure buyers.

plymster said...

Personally, I wouldn't waste the electrons to post on the Rain City Blog. The only intelligent comments I see out there come from people who post regularly here, anyway.

You're dead on with your analysis of their belittling of the "bubble" argument. Posting there is futile, though, and reminds me of the classic quote:

I learned long ago never to wrestle with a pig.
You get dirty, and besides, the pig likes it.
---George Bernard Shaw

Matthew said...

The good point of posting on the RE blogs is that it brings others to this site. I remember when I first starting looking to buy I was in Greenlake and they were building townhouses next to be friends apartment. I saw a realtor outside and asked her how much they were going for, she told me 425,000 each. I thought to myself, wow, this market is out of control.

Surfing through various RE sites I eventually found this one, and found that yes, there are rational people in the world who were thinking like myself, that this market does not make sense. By fighting the battle both here, and on the RE blogs, you can hopefully save someone else from making a grave mistake, by buying a house in this over-inflated market.

Unfortunately there is just not enough information out there to inform first time buyers of their impending peril. Unfortunately before I found this site all I heard and found online was "Seattle is different, there is no bubble here."
"Look at the other west coast cities, its cheap to live here compared to Cali". Etc Etc. Its good to hear the other side of the story, not championed by mortgage brokers and RE agents, but rather by independent thinkers without a stake in the market in which putting food on the table means making another inflated sale.

synthetik said...

LOL, you may be right, but when I moved to Seattle, that was the first blog I read... why not believe it?

Matthew said...

BTW, I think its great that Synthetik is championing the cause of informing people on all of the other blogs. Hopefully this will bring about some change, or at least some inspired discussion.

emailers2 said...

Matthew, what is the mgt broker crack down about? Are yoiu referring to the new rules issued last week?

PepeDaniels said...

Matthew said...
Not normally a conspiracy theorist considering I work for the federal government, but does anyone think that the drop in oil prices seems to be related to the elections in November???


It's impossible to believe that the drop in oil prices right before the election is just a coincidence.

One theory going around on the web is that the military may have aggressively bought up oil on the market over the summer as part of a set up for a drop in pricing this Fall.

As the largest "consumer" in the nation that consumes the most oil in the world, they're in a position to affect the market.

I understand that GW's still has a few connections to the oil industry. ;-)

Anyway, it's probably not that hard to manipulate the prices to a degree for a period of time at least.

Matthew said...

Federal regulators are going to start analyzing loans at federally chartered institutions. There is an article about it on Ben Jones page : "http://thehousingbubbleblog.com/". I had been hearing rumors about this for a while but apparently now its going to happen. Not sure if this was posted on here a week ago or not, just saw it on his page today.

Richard said...

Found a nice little Townhome flip by Greenwood. Sold in Feb 2006 for $272K now back on the market for $325K. This one will be interesting to watch. Another place 2 blocks south sold for $325K this summer - then relisted at $299K before getting pulled off the market.

10520 WHITMAN AVE N

Also, any Death Cab for Cutie fans out there? The guitarist's childhood home is up for sale. Meshugy?

http://www.johnlscott.com/35068

emailers2 said...

Matthew, it is about time.

dalas said...

he's not using the correct terms either, WAMU and Countrywide are not brokers. They're direct lenders/portfolio lenders that lend their own asset.

do share your source, matthew, I think you are referring to the fed reserve guideline.

dalas said...

I guess it took a long time for me to post that last comment...

Eleua said...

One theory going around on the web is that the military may have aggressively bought up oil on the market over the summer as part of a set up for a drop in pricing this Fall.

I seriously doubt this.

The military purchases fuel months in advance, and does so by Congressional mandate. The DOD budget is approved by Congress, and you can bet that if the Administration put in a huge buy/sell order that would turn the election, the minority party would scream like the little girly men they are.

The best theory that has surfaced was the Goldman-Sachs Commodities Index was tweaked to spark a massive selloff in oil futures.

It would be too difficult to use the military, too easy to trace, and too easy to derail.

synthetik said...

>I understand that GW's still has a few connections to the oil industry. ;-)

I'm not sure but I believe the Saudi's are the largest voting body in OPEC. The Saudi family also has ties to the Bush administration going back 20+ years.

Source: "Confessions of an Economic Hitman"

I'm not saying I believe our administration has manipulated oil/gasoline prices, but it wouldn't surprise me.

I don't see much difference between dems and reps at the presidential level. Both are controlled by the vast corporatocrasy (sp?) the last 50+ years. Anyone or any country that gets in the way gets removed.

Kaleetan said...

Mr Greenspan thinks the worst is over for the housing market, but I am sure he just another housing cheerleader, right?

WASHINGTON - The U.S. housing market appears to be emerging from its recent travails and the “worst may well be over,” former Federal Reserve Chairman Alan Greenspan was quoted as saying on Friday.

“I suspect that we are coming to the end of this downtrend, as applications for new mortgages, the most important series, have flattened out,” Greenspan said at an event in Calgary, Canada, sponsored by BMO Financial Group, according to a transcript BMO made available.

“There is a good chance of coming out of this in good shape, but average housing prices are likely to be down this year relative to 2005. I don’t know, but I think the worst of this may well be over,” he added.

Richard said...

Mr Greenspan thinks the worst is over for the housing market

His comments are most certainly aimed at the effect of the US housing market on the general economy. We've already seen a substantial drop in GDP that is being attributed to the housing slowdown.

More important to note is that Greenspan engineered the "soft landing" that included the pop of the dot com bubble and ensuing recession.

SeattleMoose said...

Oh please, stop with the government manipulation already....

Enron proved that there are no conspiracies and energy prices cannot be manipulated.

And as far as a "crash" in RE. Greenspan has said that the crash is over and we all know how his steady hand stopped the last .dotcom bubble from bursting. The man is a genius.

Ya'll should order tin foil hats from Amazon...and uh, please order me one while you're at it.

EconExchange said...

"Mr Greenspan thinks the worst is over for the housing market, but I am sure he just another housing cheerleader, right?"

Well, last year ol' Ben Bernake said that the housing 'slowdown' would not have an effect on the overall economy.......now he comes out a couple weeks ago saying he predicts it to take 1% off GDP (conservative again). Plus Greenspan is just trying to downplay this because he knows it was the FEDs fault....just trying to deflect the blame now and downplay it's significance @ the same time.

dalas said...

It would appear that king county has stopped allowing downloads for deed of trust on the website.

http://mkcclegisearch.metrokc.gov/attachments/22276.doc

Can somebody verify this?

dalas said...

http://mkcclegisearch.metrokc.gov/
attachments/22276.doc

Christina said...

It would appear that king county has stopped allowing downloads for deed of trust on the website.

They're drafting an ordinance.
It's true that deeds of trust are electronically mined, especially by shady mortgage lenders and insurers in the Southern California area. (What's the matter, Upper Mexicans? Ran out of suckers in Orange County and San Diego?)

AFAIK, deeds of trust can be removed from the Records Website by request. The bulk of Deeds of Trust do NOT have social security numbers.

Seattle Eric said...

You guys got a treasure over here in the form of Eleua (I always have to double check the order of the vowels in her name). He/She is smart and articulate, if not a little cheeky.

It's interesting...reading through these comments, I feel like I'm in a parallel universe. Everyone makes sense to each other over here, and everyone views RCG as the bizarro world. It's funny how synth felt baited...i felt the same way.

It's all a matter of perception and perspective.

Actually, the comments in that RCG 'bubble' post has evolved into an interesting back and forth. No one necessarily agrees with the other side, but there's a modicum of decorum and respect.

Anyway, I'm not looking for trouble - I just thought I'd drop a different perspective (I feel like the guy waving the white flag so he can meet the enemy for discussions without getting shot).

Great comments, all!

biliruben said...

Pop in any time, Eric.

You might get a bit of flack, but if you have a bit of thick skin, you'll be fine.

It would be great to have your perspective on the market, as you are in the trenches trying to sell a couple of properties right now, right?

You also might learn some warning signs that might help you with your timing, though this blog has veered off from some of the discussions of fundementals lately.

Read through some of the older posts. Very good.

synthetik said...
This comment has been removed by a blog administrator.
synthetik said...

I just got back from getting my arse handed to me at my first game of "Cash Flow 101".

At $200 a pop, the cash is sure flowin' into Kiyosaki's pocket quickly!

redmondjp said...

At $200 a pop, the cash is sure flowin' into Kiyosaki's pocket quickly!

Yes, you know that the game is over when somebody is making $$ telling YOU how to make $, doing whatever it is that they USED to do to make $ (like Trump's latest apprentice). This is where the real $ in those MLM scams is as well--you don't get to a diamond level by selling laundry soap--you do it by having the one-day "seminars" at a hotel somewhere and charging couples $60-80 to attend a rah-rah session.

I always wonder--if the person was making so darn much cashola doing ____, why did they stop doing it? Maybe to fish in a larger lake of fools?