tag:blogger.com,1999:blog-15223784.post1069355938811516007..comments2023-10-08T06:24:07.089-07:00Comments on Seattle Bubble: 02.13.2007 - Tuesday Open ThreadThe Timhttp://www.blogger.com/profile/14832570891451659976noreply@blogger.comBlogger27125tag:blogger.com,1999:blog-15223784.post-72240946338914704142007-02-14T07:01:00.000-08:002007-02-14T07:01:00.000-08:00Macaca...I could write quite an economic dissertat...Macaca...<BR/><BR/>I could write quite an economic dissertation here with regards to gold.<BR/><BR/>I must correct my post...I meant to say 5 years.<BR/><BR/>I'd rather not take too much away from the focus of the blog here as it is not my blog.<BR/><BR/>My sources...Chinese Newspaper articles both new and old and all sorts of random stuff...Even a Chinese Blog that was written in English.<BR/><BR/>China has money...We have debt.<BR/><BR/>Follow the money.EconEhttps://www.blogger.com/profile/03366126036963024056noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-59767413138466007982007-02-14T01:37:00.000-08:002007-02-14T01:37:00.000-08:00Brian Stated..."Wouldn't rents then spike because ...Brian Stated...<BR/><BR/>"Wouldn't rents then spike because of the tax burden placed on property owners? It's not like you can stop the dominoes from falling all the way down the line in these scenarios."<BR/><BR/>If housing prices fall the way I think they will...they will be so inexpensive that rents will decrease even with the tax burden...I don't have any mathematical equation to back that up (I didn't care much for econometrics anyways)...but I guess I just have a hunch.EconEhttps://www.blogger.com/profile/03366126036963024056noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-85052140323908531462007-02-13T23:20:00.000-08:002007-02-13T23:20:00.000-08:00Lake Hills Renter: The psychology is beginning to...Lake Hills Renter: The psychology is beginning to change. It's hard to say which comes first: psychology or market forces. Remember back to about March/April of 2000, a mere 7 years ago: plenty of people still thougt tech stocks were a good investment and as the NASDAQ fell they continued to "buy on the dips", but after a few months they were just overwhelmed. It only took about six months for the NASDAQ to lose 1/2 it's value and it's still about 1/2 of what it was at the 2000 peak (it's even worse when you adjust for inflation).<BR/><BR/>People don't have to be talking about tightening lending standards: they'll find out when they go to get an 80/20 mortgage that they need to come up with that 20% in cash now, not by some shady 2nd mortgage on the house they're buying. Then when the deal falls through because it was predicated on 80/20, that's when they'll be talking about it. In other words, most people will be finding out when their mortgage application falls through and yet they thought they had such good credit...Unknownhttps://www.blogger.com/profile/00030800035568351309noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-90794325224716907302007-02-13T18:33:00.000-08:002007-02-13T18:33:00.000-08:00You guys know I'm a bear, but I'm getting a sneaki...You guys know I'm a bear, but I'm getting a sneaking feeling that 2007 won't be the year we start seeing a decline in local prices. I hear too many people talking about RE as a good investment and hear too little about tightening lending standards. Psychology alone may keep this going a while longer. I fear we may be in for another year of continued insanity.Shadowedhttps://www.blogger.com/profile/02275066426135302508noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-12242384044139243342007-02-13T16:26:00.000-08:002007-02-13T16:26:00.000-08:00Speak little of gold...for now.Buy Gold...physical...Speak little of gold...for now.<BR/><BR/>Buy Gold...physical...not stock.<BR/><BR/>Research China and their history with gold for the last 3 years.<BR/><BR/>People used to think that gold investors were crazy...just a bunch of cooks...Everybody would tell their goldbug friends that Real Estate or the Stock Market were the places to make the real money.<BR/><BR/>My prediction for 2-3 years from now...these 2 statements will be normal.<BR/><BR/>"do you remember when people *actually thought a mil for a 2 br condo was a good investment."<BR/><BR/>"do you remember when gold was *only $1000/oz"EconEhttps://www.blogger.com/profile/03366126036963024056noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-43264216011670915042007-02-13T16:04:00.000-08:002007-02-13T16:04:00.000-08:00Anyone see this over at Rain City Guide? Ardell ta...Anyone see this over at Rain City Guide? <A HREF="http://www.raincityguide.com/2007/02/12/is-freakonomics-right-for-the-wrong-reasons/#comments" REL="nofollow">Ardell takes on Freakonomics</A>!<BR/><BR/>When does this woman have time to sell Real Estate?<BR/><BR/>My favorite comment is #8Anonymoushttps://www.blogger.com/profile/03068286489902391347noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-78556703683459145552007-02-13T15:30:00.000-08:002007-02-13T15:30:00.000-08:00I was looking up ratings about my new apartment ov...I was looking up ratings about my new apartment over on apartmentratings.com and noticed an interesting <A HREF="http://www.apartmentratings.com/rate/WA-Seattle-Pricing.html" REL="nofollow">graph</A>.<BR/><BR/>Shows that with 277 responses for a 1bd/1bth unit, prices only rose by 2.94% in 2006 and actually <B>dropped</B> 9.25% for 2bd/2bth.<BR/><BR/>Where'd they get the data?<BR/><BR/><I>Data used to calculate average prices by floorplan are gathered from renters' disclosure of monthly rental rates on ApartmentRatings.com, the Internet's most popular website where renters can exchange information about apartments.</I><BR/><BR/>But you better buy now because it's obvious we're about to become another NYC or London.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-15223784.post-84162933362688802362007-02-13T13:49:00.000-08:002007-02-13T13:49:00.000-08:00Back to real estate, rather than speculative dooms...Back to real estate, rather than speculative doomsday economics.<BR/><BR/>Has anyone been looking at the new construction townhouse market within Seattle proper? It seems to me that builders are budging a little bit on pricing now - what I'd like to know is how many of these transactions go for less than "MSRP", in recent years vs now, and what sort of kickbacks and incentives the builders are offering right now?<BR/><BR/>I'm not shopping, the construction quality on most of these shoeboxes that I've walked through is appalling. But I think as a signal of builder desperation, incentives have been pretty reliable indicator in other markets.<BR/><BR/>I don't think we're quite at "free car!" yet, but I'm seeing a lot of rolling appliances and large televisions into the sales price to move the house (does this really work?)<BR/><BR/>Any personal anecdotes?Bhttps://www.blogger.com/profile/17554690956040177155noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-82043580295993546892007-02-13T13:08:00.000-08:002007-02-13T13:08:00.000-08:00The Euro, the Yen, the Pound, they ARE all devalui...The Euro, the Yen, the Pound, they ARE all devaluing along with the dollar.<BR/><BR/>Like America in these last few years, you can raise interest rates to "show" you are against inflation, yet you open the money printing even more.<BR/><BR/>The Euro is just becoming the "trash of the month". You may preserve some capital, but it's only temporary. The only currency that cannot be devalued is gold...check out GLD. It's a fund that buys actual gold bars for every share you purchase. Gold mutual funds are also a good idea.<BR/><BR/>China can keep the game going on for a long time...they won't dare pull the plug (sell their dollars) unless they think their economy can get by without America, otherwise they fall with us. That could be 10 years away. The other central banks of the world will play along and print money, because they too can't let America fall down. <BR/><BR/>Thanks to a global economy, we can all inflate together.Greghttps://www.blogger.com/profile/05175206079746164051noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-31612194198893742102007-02-13T12:55:00.000-08:002007-02-13T12:55:00.000-08:00ververGreghttps://www.blogger.com/profile/05175206079746164051noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-88579382145778644452007-02-13T12:47:00.000-08:002007-02-13T12:47:00.000-08:00Looks like precious metals have seen quite an upti...Looks like precious metals have seen quite an uptick recently, though gold has dipped in the last few months <A HREF="http://www.everbank.com/direct.asp?IdPage=pro_met_cen" REL="nofollow">Gold and Silver 5-Year Performance</A>.<BR/><BR/>Are investors pulling away from real estate and getting into metals?Trickshothttps://www.blogger.com/profile/05612758585509150146noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-68423870162374052102007-02-13T12:30:00.000-08:002007-02-13T12:30:00.000-08:00A very easy way to buy lots of other currencies is...A very easy way to buy lots of other currencies is to open an account here:<BR/><BR/>http://www.everbank.com/main.asp?affid=eb<BR/><BR/>I haven't done this, but I've seen it recommended elsewheredanhttps://www.blogger.com/profile/12670234047371384937noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-67734135114741607352007-02-13T11:14:00.000-08:002007-02-13T11:14:00.000-08:00Terry...Matt...I remember the early 70's also...no...Terry...Matt...I remember the early 70's also...not well enough though...although I was very young. I asked my Father about the inflation and he mentioned to me that the Government used was capping prices of many goods...not to mention that government approval was needed in order to raise prices...much as the Insurance Industry today has to work with the Insurance Commissioner for rate increases.EconEhttps://www.blogger.com/profile/03366126036963024056noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-84590531228058572952007-02-13T11:02:00.000-08:002007-02-13T11:02:00.000-08:00Terry,Good point. There is almost always a direct...Terry,<BR/><BR/>Good point. There is almost always a direct correlation to the end of a war and the increase of inflation. An increase in inflation happened after every war in the 20th century.<BR/><BR/>Anytime you increase spending without an increase in taxes, inflation is inevitable. We all know that G.W. is a big spender and has been cutting taxes, we'll see how this plays out.<BR/><BR/>I believe the FED realizes this and why the tough talk on inflation, but yet these realize the economy is slowing so therefore aren't raising rates. Therein lies the dilemma.Matthewhttps://www.blogger.com/profile/12639743614054159740noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-16758210938787892022007-02-13T10:49:00.000-08:002007-02-13T10:49:00.000-08:00greg mentioned something in his post I have yet to...greg mentioned something in his post I have yet to see anyone else mention - ..."trillions of $$$s injected into the economy through war spending...." <BR/><BR/>I'm old enough to remember the Vietnam War. Does anyone else remember the big inflationary spike the U.S. experienced right after the end of the war? I remember reading that the inflation we experienced at that time was due to the billions spent on the war, that it all came home after marauding around the world for awhile. Maybe significant inflation in the near future is inevitable, given the similar circumtances with our current fun activities in the Middle East.Terryhttps://www.blogger.com/profile/11828480316508814814noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-47462447550117046912007-02-13T10:40:00.000-08:002007-02-13T10:40:00.000-08:00And yet another great reason to be working for big...And yet another great reason to be working for big brother.... They are going to need someone standing in front of the banks with machine guns...Matthewhttps://www.blogger.com/profile/12639743614054159740noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-63952217548506833032007-02-13T10:39:00.000-08:002007-02-13T10:39:00.000-08:00You can buy Euros by investing in Exchange Traded ...You can buy Euros by investing in Exchange Traded Funds (like FXE), or buy investing in European investment funds (like Vanguard's European Stock Index, VEURX). I think this is a good short-term (maybe 2-4 year) strategy if you believe that the housing bubble will take down the US economy. <BR/><BR/>What's more distressing, though is that if the US economy (25% of global demand) takes a dive, the global economy is in trouble, and then even European investments will be in trouble once the US consumer collapse trickles down.plymsterhttps://www.blogger.com/profile/06736724521774848093noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-64530398121129880932007-02-13T10:34:00.000-08:002007-02-13T10:34:00.000-08:00yes...Eleua...the burden will fall on tax payers I...yes...Eleua...the burden will fall on tax payers I feel.<BR/><BR/>The morons that get bailed out...hmmm.<BR/><BR/>Just speaking in easy numbers.<BR/><BR/>If the Gov is gonna spend $100 on the "bailout"...$90 (my conservative estimate) will go to the Banks...<BR/><BR/>and the other $10...will be for the "morons".<BR/><BR/>What could these "morons" expect to get with their $10 bail out?<BR/><BR/>A Fema trailer. If they are good enough for the citizens of Florida and Louisiana...then they are good enough for everybody.<BR/><BR/>In fact...I think that former Seattle condo dwellers might actually prefer the spaciousness of the fema trailer their "former" 400sf condos.<BR/><BR/>There may also be some intangible benefits such as...<BR/><BR/>No longer will said former condo owner have to complain about the pretentious arrogant whoever that lives next door as I feel that there will be much more humility in society after the ego party is over...well...at least until the first guy gets granite, stainless, and hardwood floors installed in their trailer.<BR/><BR/><BR/>There may also be lucrative television deals to be made within future Fema Cities.<BR/><BR/>'Cops...Fema City'<BR/><BR/>...everybody likes those Cop shows don't they?<BR/><BR/>'Hobo Joe's Trailer Makeover Show'<BR/><BR/>...decorating tips for the newly common man.<BR/><BR/>and my personal favorite...<BR/><BR/>'Pimp My Trailer'<BR/><BR/>...you just *know there has to be a market for that.<BR/><BR/>Just out of curiosity...does anybody how long has Fema City been in Florida now...are they still there? Hasn't it been somewhere in the vicinity of four years now?EconEhttps://www.blogger.com/profile/03366126036963024056noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-46952949591617201882007-02-13T10:32:00.000-08:002007-02-13T10:32:00.000-08:00WTF,You can trade currency by going through most c...WTF,<BR/><BR/>You can trade currency by going through most commercial banks. If you are a licensed ForEX trader, than you can obtain currency at the market rate. If not, you can obtain currency at your bank rate.Matthewhttps://www.blogger.com/profile/12639743614054159740noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-48154825229209997332007-02-13T10:20:00.000-08:002007-02-13T10:20:00.000-08:00How does one go about "buying EUROS" as an individ...How does one go about "buying EUROS" as an individual? It seems like it would be a "safer investment" especially if the dollar is poised to fall so precipitously. <BR/><BR/>That nest egg I've been saving for a sane down payment on a house (assuming pricing gets in line) could get devalued rather quickly even at the 5% interest I'm getting on it.Trickshothttps://www.blogger.com/profile/05612758585509150146noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-27792069375314714942007-02-13T10:12:00.000-08:002007-02-13T10:12:00.000-08:00Greg - The problem with #2 is that currently we ar...Greg - <BR/><BR/>The problem with #2 is that currently we are financing our "Team America" actions with debt purchased by our friends in China. Should the Chinese realize that we are going to start cutting rates again and that massive inflation is imminent, they would sell dollars and buy EUROs. <BR/><BR/>Its a double edged sword, the FED is damned either way. My guess is that Bernake will continue the tough talk, but in reality the only solution is to keep rates where they are, watch the fallout, and pray for the best.Matthewhttps://www.blogger.com/profile/12639743614054159740noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-20528227712777126592007-02-13T10:09:00.000-08:002007-02-13T10:09:00.000-08:00Wouldn't rents then spike because of the tax burde...Wouldn't rents then spike because of the tax burden placed on property owners? It's not like you can stop the dominoes from falling all the way down the line in these scenarios.Bri&Meghttps://www.blogger.com/profile/13562627487394828586noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-27311787790865841032007-02-13T10:02:00.000-08:002007-02-13T10:02:00.000-08:00I think econe is onto something.When the wipeout c...I think econe is onto something.<BR/><BR/>When the wipeout comes, government will do what government does, which is to bail out all the morons at the expense of those that can still pay.<BR/><BR/>If your assets are in dollars, you can put green slips of paper in your mattress. If your wealth is in property, you can't hide it, and the government is in on the transaction.<BR/><BR/>It's not like you can just put your house on your sailboat and sail off to some tax haven like the Caymans, Nevis, or Vanuatu.<BR/><BR/>Just another reason to be a renter - portability and asset protection. Whodda thunk?Eleuahttps://www.blogger.com/profile/08248482892459370601noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-50789583221464418882007-02-13T09:57:00.000-08:002007-02-13T09:57:00.000-08:00...the dollar will not crash because other nations...<I>...the dollar will not crash because other nations are devaluing their currency at the same time.</I><BR/><BR/>What other nations are devaluing their currency? The <A HREF="http://www.ecb.int/stats/monetary/rates/html/index.en.html" REL="nofollow">European Central Bank</A> has been raising interest rates lately. The <A HREF="http://www.bankofengland.co.uk/publications/news/2007/003.htm" REL="nofollow">Bank of England</A> has been raising interest rates. The <A HREF="http://www.iht.com/articles/2007/01/18/business/yen.php" REL="nofollow">Bank of Japan</A> had a 6-3 vote to keep interest rates level. The global industrial community is raising interest rates. This is the most pivotal point in the deflation/inflation argument.<BR/><BR/>If the Fed lowers interest rates in these international conditions, the dollar will freefall. It won't help foreclosure rates or bank failures because it will be too little, too late. It will also cause a mass exodus of foreign investment in US funds. Gas prices will soar in the US, and voters who guage inflation based on gas prices, will revolt. Treasury interest rates (rates on the national debt) will advance, since Asia and other nations will be moving towards a more stable currency for reserve purposes. Congress will be forced to pressure the Fed to do raise rates.<BR/><BR/>I expect a slight lowering of interest rates, a big scare, and then a quick rise in rates to try to stay internationally competitive. I think this is the more likely scenario, given the history of those in charge.plymsterhttps://www.blogger.com/profile/06736724521774848093noreply@blogger.comtag:blogger.com,1999:blog-15223784.post-36616521198652448092007-02-13T09:34:00.000-08:002007-02-13T09:34:00.000-08:00Tricks up mortgage lenders sleeves? Not ones that...Tricks up mortgage lenders sleeves? Not ones that are any more financially prudent for either the lender or the borrower.<BR/><BR/>I feel that the government will let people hang out to dry...it won't be easy but we now have good practice with such measures after what we have seen in New Orleans. Not to mention...each persons situation would be different...and it would be inefficient to help out individuals on a case by case basis not knowing when the end is in sight.<BR/><BR/>So...my guess...call...whatever...is that the Gov. will bail out the banks/financial institutions etc...not so that they can make even more stupid loans to stupid consumers...but rather so that they can pump money into the economy in the business sector...in a proper manner...in order to keep people at work. I also see large government work projects.<BR/><BR/>Housing will end up being very inexpensive...however...the taxes for owning those homes could potentially very high in order to help fund the bail out...after all...the people left standing (able to afford/keep their homes) will be the only ones with the money left and will shoulder a larger burden.<BR/><BR/>There will be lots and lots of regulation...things will also happen that will be things that are not only more serious than we thought...but repercussions that come about completely unexpectedly.<BR/><BR/>that's just my guess...but in reality...I think that it is being overly optimistic.EconEhttps://www.blogger.com/profile/03366126036963024056noreply@blogger.com