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No serious person would argue for making policy based on movements in the stock market. Everyone knows that its day to day movements are driven by mass psychology, they tell us virtually nothing about the actual situation of the economy. That is why it was so pathetic when President Bush seized on the stock market plunge on Monday as evidence of the need for his bailout package.
If the media had been responsible, they would have ridiculed Bush for adopting such an absurd scare tactic to gain support for his plan. Instead, the media seized on this point and began running around to people with holdings in the stock market and asked them how they felt about the plunge. They got experts to talk about what the plunge meant to 401(k)s, as well as what it meant for public and private pensions. In other words, the media did their best to convince the public that the stock market plunge demonstrated the urgency of the bailout.
Okay, so let’s see if the media can apply a consistent standard for a whole week. Now that Congress has passed the bailout, the stock market is even lower than it was on Monday. Where are the stories about all the people who lost money in the stock market, the stories about vanishing 401(k)s and crumbling public and private pension plans? If it was important to talk about the stock market plunge when it could be blamed on Congress’ rejection of the bailout, why isn’t important to talk about the even lower stock prices after Wall Street got its bailout?
82 Comments
“Government by Dow” is absurd, but is useful to our overlords, except when it’s not.
Well said.
Expecting seriousness and consistency from the media surely leads to disappointment.
Bush is desperate to sell this plan he will say anything.
I don’t understand how the most popular president in the history of polling, (on the day that he hits that number), and during the last days of a lame duck session, manages to push through such an enormous spending plan.
It’s unprecedented. Pelosi had enough votes that she could let people in tough races off the reservation, like uber-Blue Dog Chris Carney, and they voted against it. They knew they were pushing through an unpopular bill. Because why, they care so much about the good of the people that they’re willing to risk the fall’s election over it? Now they’re suddenly great public stewards? Like with the Iraq war ‘n’ shit?
I can’t think of a better word than “disgusting” at the moment, but give me time.
looking forward to what you come up with. not having your talent with words, i resort to incoherent raging.
It’s a crisis. You act in a crisis. To not act is irresponsible and unpatriotic.
There’s the simple logic, whether it’s really true or just a manipulation by the Bush team. Would you want Dems to do nothing and let Bush manipulate things to pull down the economy — and blame it all on Dems…just before the election?
The disgusting part is the way the Bush team destroy everything.
Maybe the market is smart enough to know that ripping $700B out of the heart of the government is NOT good for ANYONE.
Financial pundits are bears at the moment- some predicting an 8,000 DOW—that puts us in 1929 territory.
I don’t know for sure if the bailout is the right thing to do- but Buffet favors it and I usually trust his judgement.
Depressions are no fun- if this thing helps to stave one off- I’m in favor of it.
And pacifists are usually trustworthy to not commit murder, but when their own lives are in danger all bets are off. Buffett understands risk management, and so he probably saw a much larger downside when given the binary choice of this bill or no bill at all.
That’s the problem. It never was binary, except to the administration. The overwhelming consensus of independent economists was to slow down a bit and consider other options. I don’t believe congress has any notion of supporting the people who do the voting.
everything is binary to Preznit Zero One. You’re with us or agin’ us, etc etc etc.
One thing we must all do is to stop depending upon the judgement of others in matters of importance. Buffett had a clear financial interest in seeing this bailout happen. We have to think for ourselves, i’e’, what effect does this action or option have upon MY particular interests? When we make icons of others so we can remain mentally lazy and uninformed, we get screwed every time and, frankly, we deserve to be. Sheep are for shearing.
I’ve had nine quarters of economics and twenty plus years of executive business experience and I have read a fair amount about the crisis- and I am still not able to figure this thing out “on my own”.
If you can figure it out for yourself- congratulations!
Soooo glad to hear someone with knowledge of economics say that. I’ve been struggling to grasp even the basics–and it’s like trying to follow a lesson on nuclear physics, in Greek!
Maybe you should beat up your eco professors. It’s not that difficult. Too much easy money and too little regulation led to excessive risk-taking and creative runaway fraud, as it always does. All excess must be worked off by having the market pendulum swing in the other direction by an approximately equal amount. If the banks were all allowed to collapse today, there would be new players (and some surviving old players) who would step up and become the new bankers. When in history has there ever been an absence of bankers? People generally should not rely too much on credit to acquire what they want. That about covers it.
So what’s your guess at the dead net cost/profit to taxpayers as a percentage of the capital expenditure? My econ professors are probably all dead.
Any guess would be just a guess. But it will run into at least the many trillion dollars range. The key parameter will be how many mortgages get defaulted on. Given the employment picture, there is no end in sight to that trend.
I agree; I don’t think most people have any sort of clue with respect to most of what’s going on economically right now. I do think that those in Washington’s running around yelling that the sky is falling didn’t help. So, I’m not sure what to think of the bailout. Krugman supports it, though not strongly.
I think it’s quite possible Bushies didn’t want Cong. to do anything and to ensure that they gave Dems the nastiest stinkiest ‘plan’ they could come up with. But, Dems took a bit of time and improved it significantly in amazingly little time. Now we watch to see whether Paulson actually executes it or fiddles while Rome burns.
Here’s a collection of articles by economists on the subject, for the masochists among you.
http://www.bepress.com/ev/vol5/iss5/
Thanks, eCAHN!
By the way, Dean, what do you think of this and this?
wrt krugman’s post – as ecahn has said this has not been his finest hour.
or in krugman’s own words (from yesterday afternoon after the sellout passed): Has the bailout already failed?
thanks for the link. will save for evening reading, off to the farm in a few minutes.
I want to see what BushCo and Paulson showed congressional leaders that scared them to death™ ……. surely since it isn’t a national security issue it could be viewed by the general public…
We have a right to know what it was…….. was it actually anything related to the economy or their manila folders with all the NSA dirt on them and told you either cooperate or this gets thrown out to the world…..
The key is the price the feds pay for the paper- if they pay no more than 70% of the current market value of the underlying assets, then they force the banks to take a massive haircut in order to get bailed out- banks can decide how much scalp to show- if they offer 90% of face value, we’re gettin screwed.
The devil’s in the details– and Paulson only has a month to go before hangin up his green eyeshade- after that it will be up to the next prez- presumably Obama.
I have seen the assertion that Paulson only has a month remaining as SecTreas repeatedly. Am I missing something? Isn’t the inauguration of the next prez in January?
Oops- you are correct!
Firstly, the media are not serious people, secondly neither are any of the current crop of elected officials, be they legislative or executive. We are doomed to government by sound bite, scandal and non-sequitur. “Serious” left the room in the 80s or earlier.
The only reasonable conclusion is that the markets are not yet satisfied and are demanding yet another seven-hundred billion. Or perhaps they want things other than dollars, e.g., sacrificial virgins.
LA Tiems has actual *charts* on the front page, above the fold! One shows the Dow from Sept 8 to Friday’s close, the other shows the last year’s net gain or loss of jobs. The main article says basically that the bailout bill is all fine and good but the economy is just starting down that slippery slope toward the toilet, with the headline using the words “steep recession is just beginning”.
Time to start using the words “Bush recession” (or Republican Recession) to get this into common usage before Jan 21, when it suddenly becomes The Democratic Recession and all Obama’s fault.
Good idea marksb!
Maybe it’s worth writing an Oxdown diary just about that!
Um…that’s LA Times. Sheesh.
What gave the first clue?
In fact, I’m told that they are not real journalists, but rather actors playing journalists.
And BAD actors at that, kinda like the one that played prez.
Or journalists who want to be actors, they just chose to skip the table-waiting phase.
But panicking and doing as told by our betters is so much simpler.
Here’s my guess on “How Low will the Dow go?”
Whatever the Peak of the Market has been since Bush came in – say it’s 14,000, then the difference between the Market High and the Day he came into Office is the Amount by which it will fall below that same starting number, in order to correct for the Fraudulent Transfer of Wealth to the Rich.
So, I don’t know what the real numbers are, but the Math would look like this:
14,000 – 10,700 = 3,300 Max Gain
Since It Was All Fraudulent Gains Against the Market (De-Frauding the Market System) – the Gains were Stolen from Actual Value – assumed to be the Market Value on Bush’s first day, so:
10,700 – 3,300 = 7,400 The Bottom, or True Valuation
In other words – the Money Stolen by Wall Street is Gone. The Only Way to Fix it is by De-Valuing the Starting Market Value equal to the False Gain – Robbing Peter (John Q. Public) to Pay for Paul (Daddy Warbucks)’s Gambling Debts.
This is the “You Pay” part of the Wall Street Slogan: “We Gambled, You Pay!”
That’s just my common sense take on it, I’m not sure how Markets replace Fraudulent Gains – except to Pay For It Twice.
The Dow version of “Limbo”?
“How low can you go?”
Come to think of it, that line applies to this administration.
I always read with amusement comments that suggest Buffett is talking up this bill so he can make money.
He could lose 95% of all he owns and still be a billionaire!
His company is sitting on 30 billion in cash.
Yeah, he’s pretty good at making money, but if he was self serving it would be in his interest to see things get even worse so he could buy things even cheaper.
Look, I’m not nominating him for financial sainthood or anything, just trying to offer a different perspective.
If he supports the bill, we probably needed it.
There’s nothing more amusing than finding people who think Buffett is NOT about making money, for himself and his shareholders. If your argument was at all valid, he would have quit at a few billion, wouldn’t he? Duh.
You will be prsonally apying thousands and thousands of dollars for this bailout, which will be just the first installment. What exactly are you getting for your money, friend, and what is it’s monetary value to you? If you don’t know the answer, then the answer is, you are getting nothing but sheared.
You seem to be very clever at economic issues. What do you predict will be the basis for pricing the mortgage prices and what relationship will that have to the market value of the underlying assets? What will the foreclosure costs be in the aggregate and what will be the value of the paper when all of the foreclosures are dealt with- what will the actual taxpayer costs/profit be as a percentage of the deal value? What is the rationale for your judgements?
There’s no simple reply to your question, because there are many vaiations of instruments involved. It’s not primarily about house prices. Most of these securities are in the nature of default insurance instruments, based on predictions of foreclosure rates, but written with no assets to pay off the claims if any actually resulted. That is the problem. Like buying your homeowner’s or car insurance from a company that has only $1,000 in the bank to pay off the claims you might actually make. Many of these instruments will turn out to be comletely worthless, or worth pennies on the dollar. This bailout pretends to be able to set an artificially high market price with a money infusion that is probably way less than 1% of the total value of the market. Can’t work for more than a few minutes. The market will inexorably work toward the correct, much lower price, anyway. All that this changes is that the big players who are in now will be able to get out with their asses while the price is temporarily artificially supported. After that, the taxpayer will stand in their stead to take the real beating. Ian Welsh has written some very excellent and perceptive posts about this in the last few days, I suggest you go back and read them. He may be a socialist, but he’s seeing things clearly about this issue.
Well said
Of course he’s about making money, I acknowledged that.
I don’t understand your “quit at a few billion” point.
And, feel free to spare me your John McCain – like use of ‘friend’.
If we can take a rational look at this bill for a moment, the money will be returned to the Treasury over the next five years.
Any shortfall will be made up with a transition tax on the financial services industry.
People hated the Chrysler bailout, too but the govt. made money on it.
Unless housing values never come back, the govt. will make money on this as well.
My point was that he is not motivated merely by having “enough,” as you implied. If not personally greedy, he has an obligation to his shareholders to constantly grow profits.
I used “friend” to let you know my intention was to be informative in a friendly way rather than a derisive one, please don’t tell me that McCain’t has succeeded in making that word unusable by good people for all time.
This is not the Chrysler bailout, like comparing an ant to an elephant. Or a brontosaurus. How do you know what the housing market will do? The govt is now pretending that it is a better market trader than the pros. Same govt that didnt think there was a problem until last month. Only a fool would credit their judgement, analysis, or pronouncements. All markets work in cycles. Real estate is the longest of all, usually about 40 years. The bottom of this cuycle was in 1959-60, when my parents bought our house for $30,000. At the peak, it was worth about $300,000. Why not assume that we will retrace half of that gain in the downcycle? Or, at minimum, that we will givenn back at least half to all of the gains made in the blow-off phase that started in 1996? Scary, isn’t it? I called the top of the housing market in early 2005, and the top of the stock market last October, based in large part of my understanding that long uptrends are not corrected by mere momentary downtrends. The housing decline is still new, just recently ripened to the point where it had to be acknowledged by the Establishment. Expect a lot more of what we have been witnessing recently.
Housing in the west was largely in the crapper in the early nineties. It started up again in the late nineties and peaked in 2005. It’s still headed down but there is reason to expect that it will bottom in the next twelve months- usually there is a flattening for a couple years before creeping up again….the cycles have been well studied and these are not atypical.
Buying the dips works during uptrends, but not after the ultimate peak of a given cycle has been made. After the peak, you should sell rallies and expect continuously lower lows until equilibrium is re-established, or, more commonly, until the market has run well below the actual equilibrium point. That’s how markets have always worked. I believe that 2005 was the ultimate peak of this particular cycle. Time will tell. But ask yourself this, what could possibly happen to fuel the market upward more ferociously than the factors at play in the last decade? I can’t conceive of anything. Can you?
I don’t expect the housing market to regain the 2005 peak for many years- but I expect it to be above today’s level within two to three years.
In SoCal were WELL below the highs- 30% or so.
Cal led the way up, and is leading the way down. It is only a fraction of the overall national market. What do you base your optimism on? Do you foresee lower rates? A stronger economy? Better employment? A reversal of trade imbalances? A smarter population? What? Are you heavily invested in real estate?
No I am not heavily invested in real estate- but I am a buyer now for bank owned property….
The number of foreclosures is trending down- the number of bank owneds available is decreasing- we’re a long way to the edge of the woods, but there are signs that things may flatten soon—
I for one will not invest for several more years, the recession has yet to take hold so I see much more downside in both housing and equity markets. My neighbors just had a yard sale where they sold off the camper, motocross bikes, cross county vechiles etc at what every offer they got.
I have to assume they are in deep doo-doo. They have owned their house for 15 years so I’m guessing it’s a HELCO, that allowed them to buy all those toys, that has come back to bite them in the ass.
But differences of opinion are what makes a market, again best of luck in catching a falling knife.
Have you looked at any charts on future foreclosure rates?
We may be facing the calm before the storm.
See my diary; news story how how the ‘bailout’ won’t help in Sacramento area.
The bail out won’t help the housing market- but leveling of the housing market will help the bail out…
Many foreclosures are because of people with negative equity bailing from losing property- as are the short sales.
If and when the market restores equity, those foreclosures will diminish- and the underlying assets for the paper we are buying will add value to the paper…
I don’t see how anyone can evaluate this deal without knowing that planned basis for establishing the price paid for the paper…
There is ALWAYS a value at which a purchase is sound-
http://www.voiceofsandiego.org…..092608.txt
There needs to be even more than a 30% drop before the ‘leveling’ begins.
The performance of the equity markets have been based on a false economy since 1989. Greenspan decided that it would always be bad if there were a protracted bear market. Since 89 the Fed has driven interest rates lower when ever the stock markets got the sniffles, much less a cold.
This is why all those 20 something brokers became stock market geniuses, they could buy just about anything and over time the fed would bail them out with rate cuts. Well that false economy has ended, just like the false economy that propelled the housing markets. You cannot look at any data from 89 to the present as a barometer of market trends for the future. In fact if you want to do a real analysis you have to adjust for that period of time as a false indicator
Well said, yourself. So far, the best predictor of the market has been the Dow chart 1929-1938. Take a look. I’ve used it as my guide since the break in 2000, on the premise that people react the same to the same dramatic stimuli, and that that was the last great bubble. No reason to think this recovery will do any better. Japan is another good example.
I’m close to you, rwcole. In the Inland Empire, houses have fallen more than 30%. On the west side, not nearly as much.
This is one of the really big points which, I think, make Cong. Dems reasonably sanguine about the deal.
It’s sort of like a hidden tax (or maybe not so hidden) on the financial industry and a bit of a warning to never do this again or you’ll pay much more next time.
I have very guarded expectations for the bailout, but the informed people I read who were calling for it last Monday weren’t talking about the performance of the stock market. They were worried about credit spreads, liquidity problems, and collapsing banks. Most of that stuff is inside baseball to me, but it appears to be more significant than a drop in the DOW.
Via the miracle of free enterprise the markets have spoken for the all-knowing and all-wise Unseen Hand. We must appease them!
Dean,
We aren’t hearing anything today since it’s the weekend and everyone is exhausted. Plus the EU finance ministers are meeting today to talk about a world wide rate cut so everybody is focusing on that event.
The Wall St boys thought there would be a Fed rate cut, of at least 50 basis points, after the bailout passed. When it did not materialize so they let the market drift lower.
I agree the narrative was wrong to focus on the equity markets but it difficult to have a debate about credit default swaps and their impact on LIBOR or the TED Spread with the general public.
Although I don’t like this giveaway, I am one of the people who is directly effected by the credit squeeze. I sold my company early in the year and am receiving staggered payments from the acquiring company. The September check did not show up due since the companies credit lines have been frozen by their bank. There is little solace in the fact that their are millions of other business people in the same fix as I am.
Hedge funds are falling apart at an alarming rate, 90+% of all equity mutual funds are in the red so investors are pulling their money out. This is forcing fund managers to sell stocks to meet the demand for redemptions thus pushing the stock market lower. Everyone wants to sell the rallies so it hard to get a good rally in stocks. The equity markets will go much lower, Dow 8,000 is the first real technical support.
Regardless of the narrative or the bailout we are all in for a really rough time for the next few years.
Obama will do everything to create jobs but it will be years before the effects will be felt.
But you missed the real bail out story of the week. The IRS made an accounting change that will allow a bank that buys a failing bank to write down all the bad assets on the mark to market basis. This is why Wells Fargo bought Wachovia, with out an FDIC rescue package like CitiBank wanted to. This change means that Wells Fargo will not pay taxes for years to come and when the current toxic assets appreciate, say from $0.10 to $0.25 on the dollar Wells Fargo will make a tax free fortune.
So like a magician, when you were looking at the big show on Capitol Hill, the other bailout was done with an accounting slight of hand. Just like the bailout of the automakers on Tuesday passed without much fanfare.
But the tax payer is paying for thees additional bailouts with less tax revenue to Treasury.
It has been my understanding that one of the key economic problems behind the meltdown is that bankers won’t lend to each other, because they don’t trust each other. But, by getting rid of mark-to-market valuation of assets, we are permitting banks to lie to each other, i.e., claim that their assets are worth whatever they please. So, how is that going to cause bankers to become more trustful of each other?
Worse yet, if bankers are no longer marking to market, how is Hank Paulson’s buying of their junk mortgages going to help? Since they no longer mark to market, all of their good assets are now suspect. “How do we know it isn’t fantasy-priced junk?” Getting rid of mark-to-market valuation seems to make the whole rationale for the bailout a joke.
Wigwam
I am not a advocate of rescinding Mark to Market
I was stating that under the current mark to market rules, along with this weeks tax change, there was a back door bailout that the public did not see.
If Paulson does try to buy assets at “maturity value” I think he will be lynched.
Housing prices will continue to fall over the next couple of years as the recession gets worse. So if you value the assets at today’s prices the government purchase of the bad assets will offer taxpayers a chance to recoup the investment in 5 to 10 years out like Wells Fargo.
However, if Paulson buys Student Loans and Credit Card debt we are fucked.
We know Obama will rewrite the bankruptcy laws to allow ordinary citizens to wipe their financial slates clean, like the law allowed until the banks and congress adopted the return to lifetime indentured servitude. Student Loans and Credit Cards debt will be worthless when bought.
Heh. They all know they’re lyin’ son of bitches. It isn’t only some ‘truth’ or ‘transparency’ they’re looking for. They need the very vague ‘confidence’ things will move again and when they’re all in it together then none feels as exposed to sudden dangerous moves. Well, they might still be very nervous for a while, but any sign of movement by government in the right direction will help them get going again.
AFAIK the idea is to only release m-to-m a little during a crisis and then revert to m-to-m strictly during good times. Trouble has been that SEC chair Cox hasn’t used that discretion at all. Seems they wanted things to be bad.
Move the mortgages out of firms in exchange for the right amount of cash and they’ll be able to get their loans.
Yes, how to price it for the Treas. to buy it is key. They’ve been talking about a negative auction where the asset holders offer to sell and the lowest price gets to sell their first. This ensures they sell when they really need cash and that those who need it most sell first and that the price is NOT too high, but not disastrously low.
I suggest a sealed-bid negative auction, so nobody can rig pricing. I wonder if it’s ever been done before. Anyway, Paulson has discretion on how to do it, so cross your fingers.
Can the IRS really do that? It would certainly affect a lot of businesses just now. And, it would decrease some corp. asset values and resulting taxes and their gov. revenues for years. Lovely. Talk about picking winners & losers.
That’s the Bush team for ya — terrorize & destroy, buy low, sell high and make a political gain from it.
I suspect the market isn’t rising because people want to see whether the Treasury executes the plan well and soon. Why should you buy into a market of toxic assets when you don’t know whether the Treasury is your opponent or friend?
I suppose some might look at buying stock in those firms like Wells Fargo which benefit from the change. But, I think it’s still risky to be in the market when you don’t know what the Bushies might do to trash the place, steal all the “W”s and blame it on Clinton. Look at fundamentals of asset value and risk (and right now the risk is quite high).
As for the Dow, sometimes I wonder if Congress has anyone around that understands markets.
If they did, they would’ve scheduled the vote around 3pm, giving the markets only a half hour or so to react.
This would’ve probably allow the market to close in positive territory on the day (it was up 300 points before the vote) and force Bush’s appearance to occur after the close of the NYSE.
As it was, traders had too much time to “sell on fact” after the vote, and anytime Bush appears the markets head south.
selling to show fear or just expecting others to buy it up while they were selling to take profits
It’s not always obvious what’s going on in the market.
It’s not the DOW, it’s the credit crunch most of us can’t see because we aren’t in the front line of the system. But people who have had their lines of credit pulled — and I spoke with one last night at a weddin party in Sausalito–are seeing it front line and center. Think of it this way: when you see your gas guage go down, you pretty much know when to fill up the tank. You don’t see what your motor oil is doing until your engine seizes up, by which time it’s too late. The credit crunch is affecting the economy’s motor oil. I’m not happy about the bail-out, but economists I trust say that we have to do this, and they also say it might not work. We are in extremely troubled waters. This is the ‘hard landing’ everyone was talking about a few years ago, when they predicted we wouldn’t have one.
yikes!
that’s stark.
thanks for the explanation, I’m going back under the covers now.
Eli at the Mothership!
Looking Up At Nixon
“Stock Market Closes Below Monday Low: So Why Aren’t All the Pundits Screaming?”
Because they cashed out? Because they haven’t gotten their statements yet?
Seriously, you are quite right. This government has no business trying to increase stock market prices for anyone nor does anyone have any legal or ethical basis for expecting or insisting that they do so.
There will be even more shock for the average American when they get their investment statements in the next few days. This is the end of the quarter and the end of the month so bad news about this mess will be right there in black and white. We are all getting killed by this mess, and soon people will have the facts about how bad it effects them in their hands.
Hey, a great show on This American Life. PLEASE LISTEN!!!!
The Stock Injection Plan was written into the Senate Bill with subtle language and no one caught it.
So we do have one of the options we the people wanted in regards to the bailout.
http://www.npr.org/blogs/money…..th_it.html
Thought this was ended so I wrote my own diary ‘Rats in a cage’ ; more info about this subject. Short selling expires -supposedly-this coming Thursday so that might help out the hedge and investment funds. Of course such was a ruse anyway because the market makers like Goldman were exempt from such a ban.
Just ‘dugg’ this, refreshed the page, and the ‘digg it’ counter didn’t move; how come?
Not speaking for anonosassin obviously, but…
That one doesn’t even require a prediction. As of yesterday the new basis is mark-to-Paulson whether you like it or not.
Ask the relief pitcher for the winners of the 2020 World Series. She’ll know, even if she is just graduating high school.
The point is, the existing actuarial assumptions about cash flow and future prices that were used to build this house of cards are no longer accurate.
If they were still useful, even as a reasonable approximation, then we wouldn’t be having this conversation in the first place. If anyone knew how to approximate, it would be the banks, and they are signaling very clearly that even their short-term predictions are turning out to be totally wrong. So what we’re doing here is betting $700b that Hank Paulson’s guesses about the answers to your questions will be more accurate than the guesses of the bankers, because he doesn’t have his own money on the line and he can afford to take a longer, more dispassionate view.
The history of the “central planner dispassionately adjusts market prices” strategy is not very encouraging, and as far as this non-economist knows it’s never even been tried with a credit market. But hey, who knows, it might actually work this time.
You are right on. All we know for sure is that Paulson will pay MORE than the money players think the stuff is worth. MORE. Paying more than the experts with skin in the game think is fair market value is a poor startegy, to say the least.
To rcole, I hope for your sake you are not too early. Each local market is different, and the population centers will come back first. It will be a much different story for the rest of the country.
It IS too early- but some of the bank owned properties are being sold at less than 50% of peak–within five years I expect to be up on them.
If you can buy 50% off peak, that’s a pretty good price. But you realize that the national market is very different, down only 20% on average at this time. Good luck.
Ian is a coward
I am blocked from posting on his blog entries and now I’m blocked from commenting on Joe Fish’s latest entry above.
The little shit cannot take criticism
Ive been commenting on FDL since damn near it inception, so if this is my last post on FDL then the liberal blogs have become ditto heads in reverse.