HOUSING #'s

Quote from Pa(b)st Prime:

Do you trade?

What happened to builders, self improvement retailers, lenders and commercial suppliers last year? New highs? Hardly.

Have you seen any gross participation to the upside by consumer cyclicals i.e. retailers and restaurants?

There's a litany of stocks trading at 12 times earnings (cheap) in anticipation of further weakness in housing. Those are issues that can pop higher on the hint of RE stabilization.

The traders who move prices saw the slowdown a year before denizens of Yahoo's news page were clued in. Those managers were covering their shorts by the time guy's like you were sellers.

The market's rallying because the world's been short since 2/27. Absent news of a depression there's only one thing markets can do when too many folks are short. Auction higher.
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Okay...whatever you say comanche:

http://tinyurl.com/2dvccu

This isn't a minor setback...that seems to be your perspective. If I'm incorrect, sorry. But this is an issue that could really harm many more in its wake.

The RE boom has been largely cited as a large reason for the economic upturn we've had the last few years, hence the growth in that industry. You know how many people's jobs will disappear just because these companies are no longer writing subprime loans and Alt-A loans...50% of loans last year were Alt-A....that's a large percentage of the loans being cut off and the people involved with those processes aren't going to be suddenly finding work in other great sectors!

The housing market was far far overblown and it was the tech bubble in another sector and on another day...but this is much bigger. There are a lot more people involved, a lot more repercussions, and a lot longer of a lasting effect.

http://www.billcara.com/CS Mar 12 2007 Mortgage and Housing.pdf

Check out that report...it breaks open the issues quite nicely.

So you think the prices today reflect the "slowdown" right? Man, you must be right, those geniuses had NEW and LEND pegged with their valuations! They were spot on. Of course a few had it right...there are always the few who have it right. But the masses happily ignore the issues.

Alt-A loans are going to cause a lot more pain because Alt-A loans resetting means loans resetting on more middle class people with more to lose than subprimes did. Up to 25% of Alt-A loans were sold to speculators last year...that's not a small number...speculators with exotic loans that reset to higher rates or that refinance debt from a negative amortizing loans are going to get slaughtered, or they can just walk away...I'm guessing they walk...at risk to their credit and just stick the lenders and loan holders with a bunch of overpriced housing in Bakersfield and Cape Coral.

I don't disagree with you that last year a lot of adjustments were made...you're very right about that. But I think what we saw last year was due to a bit of slowdown...these loan problems are going to be a bigger problem than a natural slowdown. I think lenders squeezed the market and are going to get hit back with some major problems.
 
Quote from stock_trad3r:

The media has been overblowing this co called 'housing crash' or 'housing bubble' for the pasdt 2 years. The people who actually move the market aren't as gullible.
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I'm still waiting on you to share statistics or any insight...not just random 2 sentence answers. Thanks in advance for the 10th time. :cool:
 
Nice post. The housing effect will return as a negative news item in the future. Just not today....

It's funny. 99% of "traders" eshew trend following yet they're still shocked when prices fill in and chop.

Quote from Anunakki:

the real question is...

just how much is the RE problem priced in ? Obviously it is..anyone with any experience knows that.

But are we ready for how bad it COULD get ? Doubtful

Right now the subprimes are dying and the rest are flat. If things extend past subprime , which based on what I see around me, they will. Well , then theres still a lot more falling to do.

I think towards the end of the year when the unsold homes are piling up and regular joes, not subprimes, are drastically lowering their selling price because they cant afford the ARMs resetting we will see some major damage.

Just my $.02
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found this:

amazed it didn't make headlines


Many people with 401K or pension funds may not even realize that they are exposed. For example, the New York State Teachers Retirement System has a $91.5 billion investment in the sub-prime mortgage lender New Century Financial. And many, many funds are invested in the mortgage-backed securities market.
 
Quote from blast19:

I'm still waiting on you to share statistics or any insight...not just random 2 sentence answers. Thanks in advance for the 10th time. :cool:
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I don't need to. I'll let the market decide. So far, the market has rallied for the past 2 years despite a so called housing bubble.
 
NFI, MFA and HMB made their highs 3 years ago. By Spring 05 it was clear prices in SoFla and SoCal were stalling.

Many lenders topped in advance of housings top.

All I'm saying is, it's old news.


Quote from blast19:

Okay...whatever you say comanche:

http://tinyurl.com/2dvccu

This isn't a minor setback...that seems to be your perspective. If I'm incorrect, sorry. But this is an issue that could really harm many more in its wake.

The RE boom has been largely cited as a large reason for the economic upturn we've had the last few years, hence the growth in that industry. You know how many people's jobs will disappear just because these companies are no longer writing subprime loans and Alt-A loans...50% of loans last year were Alt-A....that's a large percentage of the loans being cut off and the people involved with those processes aren't going to be suddenly finding work in other great sectors!

The housing market was far far overblown and it was the tech bubble in another sector and on another day...but this is much bigger. There are a lot more people involved, a lot more repercussions, and a lot longer of a lasting effect.

http://www.billcara.com/CS Mar 12 2007 Mortgage and Housing.pdf

Check out that report...it breaks open the issues quite nicely.

So you think the prices today reflect the "slowdown" right? Man, you must be right, those geniuses had NEW and LEND pegged with their valuations! They were spot on. Of course a few had it right...there are always the few who have it right. But the masses happily ignore the issues.

Alt-A loans are going to cause a lot more pain because Alt-A loans resetting means loans resetting on more middle class people with more to lose than subprimes did. Up to 25% of Alt-A loans were sold to speculators last year...that's not a small number...speculators with exotic loans that reset to higher rates or that refinance debt from a negative amortizing loans are going to get slaughtered, or they can just walk away...I'm guessing they walk...at risk to their credit and just stick the lenders and loan holders with a bunch of overpriced housing in Bakersfield and Cape Coral.

I don't disagree with you that last year a lot of adjustments were made...you're very right about that. But I think what we saw last year was due to a bit of slowdown...these loan problems are going to be a bigger problem than a natural slowdown. I think lenders squeezed the market and are going to get hit back with some major problems.
More...
 
Quote from Pa(b)st Prime:

NFI, MFA and HMB made their highs 3 years ago. By Spring 05 it was clear prices in SoFla and SoCal were stalling.

Many lenders topped in advance of housings top.

All I'm saying is, it's old news.
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Uh...how is this old news? Timebomb loans that are going to be going off over the next 1-2 years? That's old news?

Why is it that NEW and LEND just hit bottom?

http://finance.yahoo.com/charts#cha...line;crosshair=on;logscale=on;source=realtime

And that doesn't look so old to me...come again.
 
Quote from blast19:

Did you read that Credit Suisse article? Or is that old news?

http://www.billcara.com/CS Mar 12 2007 Mortgage and Housing.pdf
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Of course it's old.

Just by virtue of you or I knowing the news means it's old.

If you think there's an edge in making market responses to stuff in the public domain then go for it. I choose to stop making the same mistakes....well after a thousand times or so. :D

Not to sound like Gordon Gekko but "tell me something I don't know."

I got pasted several years ago being short futures when Freddie Mae or Fannie Mac or who ever that crossgender lender is was having problems. I was probably the last guy in America to notice.

I'm not into thinking. Neither markets nor I are rational. My best trades have been catching markets that are moving for no apparent reason. Bulls climb a wall of worry. Not the type of fundamental information that drives buyers.

I suggest you spend more time reading the tape and less time reading the news.
 
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