Sonoma Housing Bubble

Pulling the cork out of Sonoma's bubbly housing foolishness

Saturday, May 06, 2006

Greed Goeth Before the Fall...

"The U.S. housing market will slow 10 percent this year, predicts John Tuccillo."

"The U.S. is beholden to unsavory people in unstable regimes, Tuccillo said, speaking at a recent Real Estate Research Forum in Richmond sponsored by the Virginia Association of Realtors. That dependence could damage the overall economy and send housing tumbling, he said."

'"The economy next year is fine, but it's beyond 2007 that I'm worried about."
Addiction to oil needs attention -- now, Tuc cillo said. "We are importing more than half our oil. It means we are vulnerable to a cut-off in supply."

'"Oil producers from Iran, Nigeria and Venezuela come from unstable and unreliable regimes. We have to be nice because we are addicted to oil."

"Falling real income. "Real wages have not kept pace with inflation. Consumers are less able to be robust contributors to growth."

"We live in a win-and-take-all society, where we pay extraordinary rewards to people at the top of the pecking order. . . . With continuing falling real income, growth will stall and stagnate."

"Living beyond our means. The U.S. owes the world $600 billion more than it receives. "The bill is coming due when the baby boomers cash checks for Social Security."'

"The country is so saddled in debt that it will have problems competing in a flat economic world with no boundaries, Tuccillo said."

"Foreign investors have taken on U.S. debt. "What happens when the supply of American debt gets higher and they refuse to take it except at higher terms?"'

"Junk mortgages. There's a tremendous amount of interest-only adjustable rate mortgages."

"Greed goeth before a fall. Interest rates are going up, teasers are running out and notes are coming due."

"When people get stretched and choose between paying their monthly mortgage or doing other consumption, they will rob Peter to pay Paul. Peter, in this case, is the engine of economic growth."


At 5/07/2006 09:21:00 AM , Anonymous tom stone said...

calling these "junk" mortgages is polite,and as far as robbing peter to pay paul...peter is going to max out his visa card pdq.maybe the bank will take a postdated check on a closed account and let things slide 'til all that cheap oil starts flowing from democratic iraq !!!by fall it will be time to leave oily rags in a bucket under the suv,and close the garage door.....

At 5/07/2006 11:02:00 AM , Blogger Athena said...

You know... it would just be really nice to see a flash of shame for just half a second on the faces of those FB's that not only shoe horned himself into an overpriced chitbox, but then HELOC'd himself into a Hummer or an Escalade. Who exactly is this guy blaming for his financial woes as they start to mount?

At 5/07/2006 02:06:00 PM , Anonymous tom stone said...

oh ATHENA,they will blame W,and poor people with brown skin,and of course the jews...the usual suspects,of whom W and aipac do bear some blame,but not themselves,oh no,they are special people in a special place who will never grow old or know hardship and death...

At 5/07/2006 09:31:00 PM , Blogger Athena said...

Right... it will be someone else's fault they over-paid for their house. It will be some other guy's fault they got a bum loan. And still yet someone else's fault they couldn't find a bigger fool to pay more than they did for their crappy house. We went to open houses today... and we heard first hand from RE agents that there just aren't any buyers out there right now. Of course prices are still going to rise... but there are no buyers. Cracked me up. How exactly do they think prices rise? Prices are based on what someone is willing to pay for a house... if there are no buyers prices rising are nothing but an illusion representing the few dollars more a seller got over the median... Once people have to get out from under their houses they will reduce prices, and take losses and prices too will come down.


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