so do we get a cut?

[dhpar]

Quote from dhpar:
//posted of Sep-4th//
let's revive this.

after today the question seems to be: "Is Fed going to cut into all time high equity markets?"

that would be so funny!

I have to quote myself from about 2 weeks ago. it is really happening - unprecedented.

 

[CaptainObvious]

This pretty much sums it up.
http://www.youtube.com/watch?v=CoEsJgpcDH8&mode=related&search=

 

[S2007S]

cutting rates will only be worse in the long run.......rates are fine where they are, adding more liquidity into this market will only inflate other asset classes causing more bubbles in other markets in the next 12-18 months.

 

[Ivanovich]

Quote from S2007S:

cutting rates will only be worse in the long run.......rates are fine where they are, adding more liquidity into this market will only inflate other asset classes causing more bubbles in other markets in the next 12-18 months.

How many times you gonna say this?

 

[S2007S]

Quote from Ivanovich:

How many times you gonna say this?

Plenty of times,

How many times did I mention about housing stocks and housing prices falling....

Im not going to stop either

 

[ssblack]

Quote from S2007S:

Plenty of times,

How many times did I mention about housing stocks and housing prices falling....

Im not going to stop either

Yeah, I don't blame you, until it stops happening (from one class to another) then you may as well continue.

 

[RoughTrader]

Quote from S2007S:

Plenty of times,

How many times did I mention about housing stocks and housing prices falling....

Im not going to stop either

Exactly. It's pretty funny how people have come to think that the artificially low prices of risk we have seen are sustainable and healthy. The tightening liquidity is a natural consequence of risk being PROPERLY repriced through each level of the economy, and people are crying foul and begging for a rate cut to try to keep the ponzi scheme going that much longer.

It's also interesting how people don't realize that FED interest rate policy is not going to stop the readjustments in risk pricing going on. Now that the secondary debt markets have evaporated, bankers are now exposed to risk directly. They will charge a healthy price to take on that risk.

Particularly in the most inflated RE areas, we will see housing continue to contract and readjust to levels where consumers can actually AFFORD the price of risk that banks now charge. This means DOCUMENTED loans that scrutinize REAL WAGES. That means PRE 2003 levels statewide for states like CA, FL, etc.

RoughTrader

 

[jjf]

Quote from RoughTrader:

Exactly. It's pretty funny how people have come to think that the artificially low prices of risk we have seen are sustainable and healthy. The tightening liquidity is a natural consequence of risk being PROPERLY repriced through each level of the economy, and people are crying foul and begging for a rate cut to try to keep the ponzi scheme going that much longer.

It's also interesting how people don't realize that FED interest rate policy is not going to stop the readjustments in risk pricing going on. Now that the secondary debt markets have evaporated, bankers are now exposed to risk directly. They will charge a healthy price to take on that risk.

Particularly in the most inflated RE areas, we will see housing continue to contract and readjust to levels where consumers can actually AFFORD the price of risk that banks now charge. This means DOCUMENTED loans that scrutinize REAL WAGES. That means PRE 2003 levels statewide for states like CA, FL, etc.

RoughTrader

If you are talking 20% deposit and repayments not exceeding 33% of annual income, then you must be looking at a 50- 60% price drop.
Add in selling agents fees and you are talking about a massive transfer of wealth in the next 3 years.

 

[S2007S]

Quote from jjf:

If you are talking 20% deposit and repayments not exceeding 33% of annual income, then you must be looking at a 50- 60% price drop.
Add in selling agents fees and you are talking about a massive transfer of wealth in the next 3 years.

30-50% in some of the most hottest markets over the last 4-6 years.

Most markets in the short term are ready for another 10% drop in prices and most likey another 20% in the next 2-3 years.

Dont listen to the fools who tell you the bottom is in, its not in and wont be for quite sometime. I would wait until 1-2 homebuilders go bankrupt over the next 1-2 years at that time 12-18 months later will probably mark a bottom in real estate. Could easily go on for 4-5 years as well. Look back in the late 80's and early 90's.

 

[S2007S]

Quote from RoughTrader:

Exactly. It's pretty funny how people have come to think that the artificially low prices of risk we have seen are sustainable and healthy. The tightening liquidity is a natural consequence of risk being PROPERLY repriced through each level of the economy, and people are crying foul and begging for a rate cut to try to keep the ponzi scheme going that much longer.

It's also interesting how people don't realize that FED interest rate policy is not going to stop the readjustments in risk pricing going on. Now that the secondary debt markets have evaporated, bankers are now exposed to risk directly. They will charge a healthy price to take on that risk.

Particularly in the most inflated RE areas, we will see housing continue to contract and readjust to levels where consumers can actually AFFORD the price of risk that banks now charge. This means DOCUMENTED loans that scrutinize REAL WAGES. That means PRE 2003 levels statewide for states like CA, FL, etc.

RoughTrader

agree 10000%

any rate in cuts will only create bubbles some where else. Liquidity drying up should be taken as a sign that its time to back off and let the markets do there own thing without any kind of interference from the federal reserve.