Greenspan contradicts Dave & Co., says increasing debt OK

[AlienCraft]

Originally posted by: alchemize
Incomes are falling? I didn't get that memo. Or are you going to go theoretical-political on me?

Even with incomes flat, real estate increases, hence increasing assets. Why does real estate increase? People recognize real estate as a tangible investment with limited resources. Good ole fashioned supply and demand.

Then let me pass it to you.
Millions of Americans have lost their jobs ( income falls). Many more are under-employed (working less hours or at a reduced rate) . That's a reduction in income.
This American has been idle for months at a time. My income has fallen. Need any more proof? Get off the computer and go outside and ask any number of random passers - by if they are earning at the same rate as 5 years ago. Tabulate your answers and get back to us.
If incomes fall and mortgages are foreclosed, the value of that land DECREASES, as no one is able to afford the current price, the holders of commercial property will not have tenants (business') thus THEIR income falls and people SELL property at reduced rates in order to unencumber themselves from debt.
Passed Economics 101 but didn't take anymore classes, huh?
BTW, Greenspan is THE MAIN TOOL of the main US Corporate Master, The Federal Reserve. A PRIVATELY HELD corporation that sets US monetary Policy with few regulations and little oversight by the people who are most affected by their decisions. When he says "Jump" the President says "How High?" and Congress licks his boots.

 

[SuperTool]

Originally posted by: dirtboy

Originally posted by: DealMonkey

What makes you think CA is ready for a market correction on housing? Pundits have been predicting that for years and nada. Unless developers/builders crank-up production big time I don't really see the supply increasing sufficiently to offset the demand. Scary to think about though considering the single-family house I bought in SoCal less than a year ago has already appreciated about $90K based on neighborhood comps. :Q

It makes me laugh every time I hear someone say the house values are going to drop in CA soon. There is no correction people! Just because the stock market dropped value, doesn't mean housing will.

I don't know about Bakersfield, but I think the bay area is in for a correction. Unless 2 br house for $500K is considered reasonable.

 

[alchemize]

Originally posted by: SuperTool

Originally posted by: alchemize

Originally posted by: dmcowen674

Originally posted by: alchemize
Incomes are falling? I didn't get that memo. Or are you going to go theoretical-political on me?

Even with incomes flat, real estate increases, hence increasing assets. Why does real estate increase? People recognize real estate as a tangible investment with limited resources. Good ole fashioned supply and demand.

That's right, wages are the highest ever from stocking shelves at Walmart for $6.50 an hour and flipping burgers at McD's which is the most Technilogical Manufacturing the U.S. has ever seen.

Yep and all those purple colored houses with 20 or more Mexicans piled into them, great value investment.

good morning Dave was waiting for you! Greenspan is such an idiot, isn't he!

Why is it you rightwingers ignore every Greenspan warning on the deficits, but grasp to any straw he throws you when it fits your agenda?

Why is you leftwingers put words in the mouths of everyone? Please quote one post of mine where I say Greenspan is wrong about deficits...

 

[SuperTool]

Originally posted by: alchemize

Originally posted by: SuperTool

Originally posted by: alchemize

Originally posted by: dmcowen674

Originally posted by: alchemize
Incomes are falling? I didn't get that memo. Or are you going to go theoretical-political on me?

Even with incomes flat, real estate increases, hence increasing assets. Why does real estate increase? People recognize real estate as a tangible investment with limited resources. Good ole fashioned supply and demand.

That's right, wages are the highest ever from stocking shelves at Walmart for $6.50 an hour and flipping burgers at McD's which is the most Technilogical Manufacturing the U.S. has ever seen.

Yep and all those purple colored houses with 20 or more Mexicans piled into them, great value investment.

good morning Dave was waiting for you! Greenspan is such an idiot, isn't he!

Why is it you rightwingers ignore every Greenspan warning on the deficits, but grasp to any straw he throws you when it fits your agenda?

Why is you leftwingers put words in the mouths of everyone? Please quote one post of mine where I say Greenspan is wrong about deficits...

You are the one putting words in my mouth. Please show me where I said you said Greenspan is wrong about the deficits. I said you ignore his warnings on deficits, not say they are wrong.

 

[alchemize]

Originally posted by: AlienCraft

Originally posted by: alchemize
Incomes are falling? I didn't get that memo. Or are you going to go theoretical-political on me?

Even with incomes flat, real estate increases, hence increasing assets. Why does real estate increase? People recognize real estate as a tangible investment with limited resources. Good ole fashioned supply and demand.

Then let me pass it to you.
Millions of Americans have lost their jobs ( income falls). Many more are under-employed (working less hours or at a reduced rate) . That's a reduction in income.
This American has been idle for months at a time. My income has fallen. Need any more proof? Get off the computer and go outside and ask any number of random passers - by if they are earning at the same rate as 5 years ago. Tabulate your answers and get back to us.
If incomes fall and mortgages are foreclosed, the value of that land DECREASES, as no one is able to afford the current price, the holders of commercial property will not have tenants (business') thus THEIR income falls and people SELL property at reduced rates in order to unencumber themselves from debt.
Passed Economics 101 but didn't take anymore classes, huh?
BTW, Greenspan is THE MAIN TOOL of the main US Corporate Master, The Federal Reserve. A PRIVATELY HELD corporation that sets US monetary Policy with few regulations and little oversight by the people who are most affected by their decisions. When he says "Jump" the President says "How High?" and Congress licks his boots.

You ask me to reply to your rhetorical and polical criticism of fiscal analysis? I don't think so. Your income probably has fallen cause you think in terms of bootlicking, corporate masters, and tools. So go tabulate your answers and keep them to yourself, I'm not interested in the whinings of the tinfoil crowd.

 

[alchemize]

Originally posted by: SuperTool

Originally posted by: alchemize

Originally posted by: SuperTool

Originally posted by: alchemize

Originally posted by: dmcowen674

Originally posted by: alchemize
Incomes are falling? I didn't get that memo. Or are you going to go theoretical-political on me?

Even with incomes flat, real estate increases, hence increasing assets. Why does real estate increase? People recognize real estate as a tangible investment with limited resources. Good ole fashioned supply and demand.

That's right, wages are the highest ever from stocking shelves at Walmart for $6.50 an hour and flipping burgers at McD's which is the most Technilogical Manufacturing the U.S. has ever seen.

Yep and all those purple colored houses with 20 or more Mexicans piled into them, great value investment.

good morning Dave was waiting for you! Greenspan is such an idiot, isn't he!

Why is it you rightwingers ignore every Greenspan warning on the deficits, but grasp to any straw he throws you when it fits your agenda?

Why is you leftwingers put words in the mouths of everyone? Please quote one post of mine where I say Greenspan is wrong about deficits...

You are the one putting words in my mouth. Please show me where I said you said Greenspan is wrong about the deficits. I said you ignore his warnings on deficits, not say they are wrong.

I would think "grasping at straws" would imply making some sort of statement. Change your words around wherever you feel like though ST, no skin off my huevos 🙂 I'd have to search my posts, but I've probably addressed deficits on a number of threads. Search archives for "trillion", I even started a nice one on entitlements 🙂

 

[dirtboy]

Originally posted by: SuperTool
I don't know about Bakersfield, but I think the bay area is in for a correction. Unless 2 br house for $500K is considered reasonable.

The only reason for a "correction" is assuming that the housing market is higher than it should be and assuming people are going to sell for less than what they paid for it. It's highly unlikely that either one will become true.

Reasonable is entirely dependant on the purchaser. If a 2br house shouldn't sell for 500k, then nobody would buy it. But people are and people are lining up to pay it. There is a greater demand than there is supply in the big cities. When that happens, prices go up until people can't afford them anymore.

 

[dmcowen674]

Originally posted by: alchemize

I'm not interested in the whinings of the tinfoil crowd.

Hmmm, could that be because the Tinfoil Crowd is growing in size? The more people that put on the Hat and block out Your's and Cad & Co, Rush, Hannity, Coulter and the President's brainwashing that everything is fine, the more and more you become in the minority. Not very comfortable with that I see.

 

[ReiAyanami]

it's "ok" for us to borrow $7 trillion, because we won't need to pay it off, its our children's children's children's children who will pay it off. that's why you can't trust old ppl with high credit card debt, wonder how much greenspan has


if we weren't the world's largest economy, then we wouldn't be able to borrow infinite dollars, but since we are, we can. until china or india lapses us.

 

[ReiAyanami]

It makes me laugh every time I hear someone say the house values are going to drop in CA soon. There is no correction people! Just because the stock market dropped value, doesn't mean housing will.

it would take an earthquake to "correct" california's housing market.

 

[SuperTool]

Originally posted by: dirtboy

Originally posted by: SuperTool
I don't know about Bakersfield, but I think the bay area is in for a correction. Unless 2 br house for $500K is considered reasonable.

The only reason for a "correction" is assuming that the housing market is higher than it should be and assuming people are going to sell for less than what they paid for it. It's highly unlikely that either one will become true.

Reasonable is entirely dependant on the purchaser. If a 2br house shouldn't sell for 500k, then nobody would buy it. But people are and people are lining up to pay it. There is a greater demand than there is supply in the big cities. When that happens, prices go up until people can't afford them anymore.

Exactly, the prices only go up while people can afford them. If people's incomes don't rise, they aren't going to be affording as much house.
As far as people selling for less than they paid for, that could happen. If someone bought an apartment building expecting $1700 per 1br rents of the boom times, and rents are now $900 per 1br, it's likely they aren't going to sell the building for as much as they paid for it.

 

[AlienCraft]

Originally posted by: alchemize
You ask me to reply to your rhetorical and polical criticism of fiscal analysis? I don't think so. Your income probably has fallen cause you think in terms of bootlicking, corporate masters, and tools. So go tabulate your answers and keep them to yourself, I'm not interested in the whinings of the tinfoil crowd.

Then answer me this Hatman, Know anyone who HAD a job who doesn't anymore?? I'll be willing to wager you know more who have lost jobs , than those who have one, unless of course you're a soldier.
If you can't think in real terms, you'll have difficulty with the abstract concepts.
I wouldn't worry about tinfoil, I'ld worry about how well you're grounded.
Life is like a shizt sandwhich, The more bread you have, the less shizt you have to eat.

 

[dmcowen674]

Originally posted by: AlienCraft

Originally posted by: alchemize
You ask me to reply to your rhetorical and polical criticism of fiscal analysis? I don't think so. Your income probably has fallen cause you think in terms of bootlicking, corporate masters, and tools. So go tabulate your answers and keep them to yourself, I'm not interested in the whinings of the tinfoil crowd.

Then answer me this Hatman, Know anyone who HAD a job who doesn't anymore?? I'll be willing to wager you know more who have lost jobs , than those who have one, unless of course you're a soldier.
If you can't think in real terms, you'll have difficulty with the abstract concepts.
I wouldn't worry about tinfoil, I'ld worry about how well you're grounded.
Life is like a shizt sandwhich, The more bread you have, the less shizt you have to eat.

Forget about it Craft, according these AT expert Bush Loyalists, the 2.5 million number is bogus, they say only a handful are "out of work", according to them the jobs are out there. Odd though, other than Manufacturing Burgers or stocking shelves at Walmart they offer no other jobs thatare "out there".

 

[dirtboy]

Originally posted by: SuperTool

Exactly, the prices only go up while people can afford them. If people's incomes don't rise, they aren't going to be affording as much house.

Here's the thing, housing prices are up 20% a year or even more. I don't know exactly, but they have gone way up. To support your arguement, one might conclude that wages have gone up an equal amount to compensate for the rise in housing prices. But they haven't.

As far as people selling for less than they paid for, that could happen. If someone bought an apartment building expecting $1700 per 1br rents of the boom times, and rents are now $900 per 1br, it's likely they aren't going to sell the building for as much as they paid for it.

I don't see this happening either. The only way rents could drop is if demand dropped so much, that renters had to lower their prices. Then the question is, where is all this cheap housing going to come from to do that?? Because I'd like to invest in it. 🙂

 

[dmcowen674]

Originally posted by: dirtboy

Originally posted by: SuperTool

Exactly, the prices only go up while people can afford them. If people's incomes don't rise, they aren't going to be affording as much house.

Here's the thing, housing prices are up 20% a year or even more. I don't know exactly, but they have gone way up. To support your arguement, one might conclude that wages have gone up an equal amount to compensate for the rise in housing prices. But they haven't.

As far as people selling for less than they paid for, that could happen. If someone bought an apartment building expecting $1700 per 1br rents of the boom times, and rents are now $900 per 1br, it's likely they aren't going to sell the building for as much as they paid for it.

I don't see this happening either. The only way rents could drop is if demand dropped so much, that renters had to lower their prices. Then the question is, where is all this cheap housing going to come from to do that?? Because I'd like to invest in it. 🙂

"To support your arguement, one might conclude that wages have gone up an equal amount to compensate for the rise in housing prices. But they haven't."

"But they haven't" :Q

But you and CAD & Co swear that wages have gone up, the highest ever, what's the problem??? 😕

 

[SuperTool]

Originally posted by: dirtboy

Originally posted by: SuperTool

Exactly, the prices only go up while people can afford them. If people's incomes don't rise, they aren't going to be affording as much house.

Here's the thing, housing prices are up 20% a year or even more. I don't know exactly, but they have gone way up. To support your arguement, one might conclude that wages have gone up an equal amount to compensate for the rise in housing prices. But they haven't.

As far as people selling for less than they paid for, that could happen. If someone bought an apartment building expecting $1700 per 1br rents of the boom times, and rents are now $900 per 1br, it's likely they aren't going to sell the building for as much as they paid for it.

I don't see this happening either. The only way rents could drop is if demand dropped so much, that renters had to lower their prices. Then the question is, where is all this cheap housing going to come from to do that?? Because I'd like to invest in it. 🙂

The same place where a 2br house sells for 500K: Sunnyvale, CA.
when I came here 3 years ago, a tiny 400sq ft studio rented for $1300, if you were lucky to find a vacancy. Now you can get a 700+ sq ft 1 br for around $900.
My lease is up in 1 month, and I looked at pricing, and sure enough it's lower than it was 6 months ago. It's starting to level off now, but it almost halved from the peak, but the property values haven't come down yet. There is a discrepancy that I believe is waiting for a corretion.
As far as prices going up 20% or more without incomes going up, so what? Stock prices went up 20% or more during the 90's without corporate incomes going up too. And if you told these sheep who like to call themselves analysts that we were in a bubble that's due for a correction, they would have laughed you out of the room.

 

[smashp]

wee part of the housing market corection is happening in my area right now.

$500,000-750,000 houses are being forclosed on left and right in the Area and are getting sold or getting offers in the 295,000-400,000 range. The people that own these properties are the Faux rich as Wife Calls them ( She is a private Wealth management Banker.... A rich persons Banker) These upper middle, lower upper earners usually live pay check to paycheck, and the number of Forclosures and bankruptcies in the Northeast ohio are is astonishing. There asr Full neighbor hoods of these Large Houses that are Vacant.

My Best friends Dad built Houses in this Price range in the Area. No More. Bankruptcy. Takes a Year + to sell a spec house, Then the Banks cut off all the lines of credit for spec homes in 5 seperate counties. 41 builders in this area in the last year have went down.

The weird part is , The Market for 90,000 -200,000 dollar homes has pretty much remained constant.


Builders are not having any problems selling houses in this price range. USed or new. The new homes are usually of the prefab trac home variety. You know the ones that give you 2000+ square feet and they accidently dry wall over about 4 heat registers and 2 cold air returns, have electrical outlets in the middle of walls, no 90 degree angles, and can be broken in to with a sharp utility knife.

 

[dirtboy]

Originally posted by: SuperTool
As far as prices going up 20% or more without incomes going up, so what?

A couple posts ago, you brought this up as a problem. I guess since that post, it is not longer an issue?

 

[charrison]

Originally posted by: SuperTool

Originally posted by: dirtboy

Originally posted by: SuperTool

Exactly, the prices only go up while people can afford them. If people's incomes don't rise, they aren't going to be affording as much house.

Here's the thing, housing prices are up 20% a year or even more. I don't know exactly, but they have gone way up. To support your arguement, one might conclude that wages have gone up an equal amount to compensate for the rise in housing prices. But they haven't.

As far as people selling for less than they paid for, that could happen. If someone bought an apartment building expecting $1700 per 1br rents of the boom times, and rents are now $900 per 1br, it's likely they aren't going to sell the building for as much as they paid for it.

I don't see this happening either. The only way rents could drop is if demand dropped so much, that renters had to lower their prices. Then the question is, where is all this cheap housing going to come from to do that?? Because I'd like to invest in it. 🙂

The same place where a 2br house sells for 500K: Sunnyvale, CA.
when I came here 3 years ago, a tiny 400sq ft studio rented for $1300, if you were lucky to find a vacancy. Now you can get a 700+ sq ft 1 br for around $900.
My lease is up in 1 month, and I looked at pricing, and sure enough it's lower than it was 6 months ago. It's starting to level off now, but it almost halved from the peak, but the property values haven't come down yet. There is a discrepancy that I believe is waiting for a corretion.
As far as prices going up 20% or more without incomes going up, so what? Stock prices went up 20% or more during the 90's without corporate incomes going up too. And if you told these sheep who like to call themselves analysts that we were in a bubble that's due for a correction, they would have laughed you out of the room.

Rents and housing prices are not always related. One reason rent prices have dropped is because interest rates are low(more people buy rather than rent).

You really should move😀

 

[ReiAyanami]

over here in La Jolla, avg house price is still just over $1 million EACH.

that "state's biggest natural fire disaster" that took out 2,600 homes causing $2.6 billion in damages because each house is a million. and they aren't large houses, they are small houses, you can buy 10-12 homes the exact same size in TX.

and my rent has gone up.
and they're rebuilding. good for the macroeconomy i guess

 

[alchemize]

Now I know why the attention whore puts such, uh, stirring titles, in his threads 🙂 Plainly put this would have slid to the bottom of the page.

 

[SuperTool]

Originally posted by: charrison

Originally posted by: SuperTool

Originally posted by: dirtboy

Originally posted by: SuperTool

Exactly, the prices only go up while people can afford them. If people's incomes don't rise, they aren't going to be affording as much house.

Here's the thing, housing prices are up 20% a year or even more. I don't know exactly, but they have gone way up. To support your arguement, one might conclude that wages have gone up an equal amount to compensate for the rise in housing prices. But they haven't.

As far as people selling for less than they paid for, that could happen. If someone bought an apartment building expecting $1700 per 1br rents of the boom times, and rents are now $900 per 1br, it's likely they aren't going to sell the building for as much as they paid for it.

I don't see this happening either. The only way rents could drop is if demand dropped so much, that renters had to lower their prices. Then the question is, where is all this cheap housing going to come from to do that?? Because I'd like to invest in it. 🙂

The same place where a 2br house sells for 500K: Sunnyvale, CA.
when I came here 3 years ago, a tiny 400sq ft studio rented for $1300, if you were lucky to find a vacancy. Now you can get a 700+ sq ft 1 br for around $900.
My lease is up in 1 month, and I looked at pricing, and sure enough it's lower than it was 6 months ago. It's starting to level off now, but it almost halved from the peak, but the property values haven't come down yet. There is a discrepancy that I believe is waiting for a corretion.
As far as prices going up 20% or more without incomes going up, so what? Stock prices went up 20% or more during the 90's without corporate incomes going up too. And if you told these sheep who like to call themselves analysts that we were in a bubble that's due for a correction, they would have laughed you out of the room.

Rents and housing prices are not always related. One reason rent prices have dropped is because interest rates are low(more people buy rather than rent).

You really should move😀

I still have some things I want to do here before I move on in a couple years.
I have to finish my Masters that my company is paying for. Also, the field I am in, there aren't that many places I can work if I want to do serious engineering that is relevant to my studies.

 

[alchemize]

For those select few of you who want to read the full contents of his speech:

Transcript

Greenspan is brilliant. I wish he would run for president.