2+2=3
May 16th, 2008 by 
reality
Housing starts were reported to be up 8.2% in April. The media and analysts are all over this, calling a bottom in housing. This after the NAHB index yesterday showing that sales sentiment was at its lowest level in history, and huge inventories everywhere.
Excuse me, people. Bullish for housing would be a 100% drop in starts, that would give some hope of clearing out the huge inventories. I mean, there is bullish, and then there is unable to do simple math. Or maybe the “big lie” theory.
Posted in Real Estate | 
May 16th, 2008 at 6:47 am
We are in bizzarro land. In any other industry increasing inventory in a slump would be punished immediately.
Some more from the bizzarre world we live in:
- Freddie moved $150+B into level 3 because they didn’t like the prices being quoted. Their regulator rewarded them by lowering their required capital cushion.
- Banks are “creating” AAA rated securities from garbage assets so they can use them as collateral at the fed and ECB lending windows. The rating agencies are assisting.
- Fannie will no longer require increased down payment in declining areas in response to pressure (government?)
I would dump everything financial on the above news. Instead the markets power upward. Won’t these bad loans come home to roost as the recession gathers steam?
Everyday I ask myself, “Has the world gone insane or is it me?”
May 16th, 2008 at 7:09 am
The examples you list aren’t insane. They are the direct outcome of Federal Reserve actions which have encouraged people to take excessive risk on the belief that the Fed will absorb their losses. They are perfectly rational, and an illustration of “moral hazard”. If you keep the winnings, and the taxpayer will take the losses, what would the rational person do? make the bet, of course.
May 16th, 2008 at 7:26 am
I am afraid the taxpayer will foot the bill as well (that would be you and me).
Unfortunately, we are talking vast amounts of money, in the trillions. I am very curious to know what you think will be the consequences if the fed and bankers succeed in dumping this much garbage on the taxpayer?
May 16th, 2008 at 1:14 pm
Higher taxes, a lower dollar, and more banking profits. Quick, I gotta buy me some Citibank!
May 16th, 2008 at 9:38 pm
dudes ALL the stats are bullshit. The Feds are purposely bankrupting this country (i should say “have”, because it already is) and they just want to keep the Ponzi scheme going as long as they possibly can. Perhaps to blame the upcoming collapse on the “new” administration.
Anybody that can do simple math can see that the stats are fraudulent, make-believe and actually criminal when it comes down to it. This administration has committed high treason and war crimes and should be overthrown as REQUIRED by the citizens in the documents this country was founded on.