www.itulip.com
Filed in: housing-data
October 10, 2006
ITulip: Animation of Housing Bubble
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I Am Facing Foreclosure: Response to Casey
Below you will find a response to Casey, a 24 year old that has 2.2 million in debt and is having trouble unloading his real estate. How did he get 2.2 million in his name? Well he fibbed here and there and I am sure his lender knew that Casey would be unable to pay. Take a look at the below response:
"Have you ever wondered why debt was against the law only a few hundred years ago? Not only that, but punishment for not paying your debt was death by either public hanging or other colorful ways. The public had a moral disregard for debt. Usury laws were in place for this particular reason. Now, we have done a 180 degree turn on things and this actually speaks more to our overall cultural obsession with debt and credit. Even look at one of the above posters who had $20,000 in credit card debt, created a website, and actually had people pay her debt off. Other people’s money paying off her inability to control her spending. Now she is selling a book and possibly, according to her website, is going to have a movie. Can you believe this? If this were only a few centuries ago she would be branded and sent off to debtors prison. But alas, many of us would be branded since our culture is one in which debt is synonymous with credit.
How can we point the finger at you if you are only functioning within the rules of the game? I believe most posters do not detest you that you are greedy since we all have a tinge of that in our red blood, but the fact that you lied and tried to accelerate the rules of the game in your favor. One thing our society has a hard time accepting is liars. We love the Horatio Alger stories since these are embedded in the seed of American culture. Start with nothing except the rags on your back and make it all the way to the top. That is if you follow the rules and you have not.
All of us have an inherent sense of greed or at least wanting more. For example, we all go to work expecting a check for our long hard hours. This is the core of a capitalist society. The only reason you are here on the web is because the real estate market crashed ahead of your time. And this too is part of the Capitalist system. As in any Ponzi scheme, the last one out usually has to turn off the lights and mop up the floors. Just imagine if you had started two years earlier, then none of this would have happened…right? Actually, I have a feeling that you would have your name penned on 30 different contracts and would be in debt for $10,000,000. Heck, if you’re going to lie why not lie all the way?
And those seminars are exercises in old school behavioral psychology. They run on the assumption of a variable rate of reinforcement, the strongest force known in this Jedi’s world. Below is an example of variable rate reinforcement:
The Lottery
Slots
Deal or No Deal
You get the picture. And seminars have such a large draw because they work. The caveat being that it will work for those five percent of the population who have some knowledge of the market, have learned via experience, and actually realize that success does equal hard work and time. If anything Casey, you learned all these skills and they will serve you well in the future. My lesson in hard knocks came at the hand of the technology bubble. Yes, that time when 20 percent year over year returns seemed like my God given right! When California housing went up 20 percent year over year for five years all I could think of was how eerily similar this was. I am not comparing housing to stocks but the mindset you demonstrate was very similar to my logic and thinking at the time. Except I did not lie and my funding source was cash advances on credit cards. Either way, my gut told me I can make 20 percent returns month to month, forget year to year, and I will be wealthy in only a few years. I had a few successes that clouded my judgment (think of this as winning $200 with the first quarter at a slot machine) and I mistook luck and timing with market intelligence. I did well for one year and needless to say lost everything come 2000; well, I should say I lost all the profits I had since I at least had the fortune to pay off the credit card advances. The party ends quickly my friend. You’ve learned a valuable lesson. I have a feeling the next few years are going to bring out a lot of your brethren and you will not feel alone. Unfortunately, I do not see the market turning anytime soon and wish you the best."
http://iamfacingforeclosure.com/
"Have you ever wondered why debt was against the law only a few hundred years ago? Not only that, but punishment for not paying your debt was death by either public hanging or other colorful ways. The public had a moral disregard for debt. Usury laws were in place for this particular reason. Now, we have done a 180 degree turn on things and this actually speaks more to our overall cultural obsession with debt and credit. Even look at one of the above posters who had $20,000 in credit card debt, created a website, and actually had people pay her debt off. Other people’s money paying off her inability to control her spending. Now she is selling a book and possibly, according to her website, is going to have a movie. Can you believe this? If this were only a few centuries ago she would be branded and sent off to debtors prison. But alas, many of us would be branded since our culture is one in which debt is synonymous with credit.
How can we point the finger at you if you are only functioning within the rules of the game? I believe most posters do not detest you that you are greedy since we all have a tinge of that in our red blood, but the fact that you lied and tried to accelerate the rules of the game in your favor. One thing our society has a hard time accepting is liars. We love the Horatio Alger stories since these are embedded in the seed of American culture. Start with nothing except the rags on your back and make it all the way to the top. That is if you follow the rules and you have not.
All of us have an inherent sense of greed or at least wanting more. For example, we all go to work expecting a check for our long hard hours. This is the core of a capitalist society. The only reason you are here on the web is because the real estate market crashed ahead of your time. And this too is part of the Capitalist system. As in any Ponzi scheme, the last one out usually has to turn off the lights and mop up the floors. Just imagine if you had started two years earlier, then none of this would have happened…right? Actually, I have a feeling that you would have your name penned on 30 different contracts and would be in debt for $10,000,000. Heck, if you’re going to lie why not lie all the way?
And those seminars are exercises in old school behavioral psychology. They run on the assumption of a variable rate of reinforcement, the strongest force known in this Jedi’s world. Below is an example of variable rate reinforcement:
The Lottery
Slots
Deal or No Deal
You get the picture. And seminars have such a large draw because they work. The caveat being that it will work for those five percent of the population who have some knowledge of the market, have learned via experience, and actually realize that success does equal hard work and time. If anything Casey, you learned all these skills and they will serve you well in the future. My lesson in hard knocks came at the hand of the technology bubble. Yes, that time when 20 percent year over year returns seemed like my God given right! When California housing went up 20 percent year over year for five years all I could think of was how eerily similar this was. I am not comparing housing to stocks but the mindset you demonstrate was very similar to my logic and thinking at the time. Except I did not lie and my funding source was cash advances on credit cards. Either way, my gut told me I can make 20 percent returns month to month, forget year to year, and I will be wealthy in only a few years. I had a few successes that clouded my judgment (think of this as winning $200 with the first quarter at a slot machine) and I mistook luck and timing with market intelligence. I did well for one year and needless to say lost everything come 2000; well, I should say I lost all the profits I had since I at least had the fortune to pay off the credit card advances. The party ends quickly my friend. You’ve learned a valuable lesson. I have a feeling the next few years are going to bring out a lot of your brethren and you will not feel alone. Unfortunately, I do not see the market turning anytime soon and wish you the best."
http://iamfacingforeclosure.com/
Filed in: mortgage-fraud mortgages real-estate
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October 04, 2006
Moody's Housing Report: 2007 not looking Good
Many of you have seen the report posted by Moody's regarding the housing situation. Below are the overall stats for you to enjoy:
WEST CHESTER, Pa., Oct. 4 /PRNewswire-FirstCall/ -- Led by the
Southwest coast of Florida, house prices in many U.S. metropolitan areas
could see double-digit declines in the coming months and even into 2009,
according to a new study that assesses the severity of the unfolding
downturn.
Sharp declines, some nearing 20 percent, are forecast by a new study,
"Housing at the Tipping Point," released today by Moody's Economy.com of
West Chester, Pa. The greatest price drops, apart from Southwest Florida,
are forecast in many metropolitan areas of California, Arizona, Nevada, and
the greater Washington, D.C., and Detroit areas.
"The housing market downturn is in full swing," said Mark Zandi, chief
economist of Moody's Economy.com, who added that "to date, the housing
downturn has been generally orderly and is characterized best as a
correction and not a crash. Whether the housing correction unravels into a
crash will largely depend on the secondary or indirect effects from the
housing downturn."
Those effects include the impact on the job market, on consumer
spending via the housing wealth effect, on lending institutions, and on the
global financial system as mortgage credit quality weakens.
"The larger these effects, the more serious the blow to the broader
economy, which, in turn, will reverberate back onto the housing market,"
said Celia Chen, director of housing economics at Moody's Economy.com,
adding, "So far, the indirect effects from the housing downturn have been
very modest."
The unwinding of the long housing boom began in the summer of 2005,
when interest rates began to creep up. While the long-term interest rates
that govern the costs of fixed-rate mortgages have risen modestly,
short-term rates and adjustable mortgage rates have risen substantially
more. The housing downturn has become more dramatic with the departure from
the market of the "flipper," the so-called buyers who intend to re-sell
their properties quickly at a profit in an environment of rising prices.
"All of this has seemingly occurred overnight," said Zandi.
The study's results are drawn from mathematical models that incorporate
many types of data, including housing prices and statistics on supply and
demand, affordability, employment, and population movement.
Moody's Corporation (NYSE: MCO) is the parent company of Moody's Investors Service, a leading provider of credit ratings, research and
analysis covering debt instruments and securities in the global capital
markets, Moody's KMV, a leading provider of credit risk processing and
credit risk management products for banks and investors in credit-sensitive
assets serving the world's largest financial institutions, and Moody's
Economy.com, a provider of economic research and data services. The
corporation, which reported revenue of $1.7 billion in 2005, employs
approximately 2,900 people worldwide and maintains offices in 22 countries.
Further information is available at http://www.moodys.com.
Metropolitan Areas That Will Suffer House Price Declines
Peak-to-Trough Peak Trough
% House Price Decline Year/Quarter Year/Quarter
Cape Coral, FL -18.6 05:4 07:2
Reno, NV -17.2 05:4 08:4
Merced, CA -16.1 05:4 09:2
Stockton, CA -15.7 05:4 08:4
Sarasota, FL -14.0 05:4 07:3
Naples, FL -13.8 05:4 07:3
Tucson, AZ -13.4 06:1 08:2
Las Vegas, NV -12.9 05:4 09:2
Chico, CA -12.6 05:4 08:2
Fresno, CA -12.5 06:1 09:2
Atlantic City, NJ -12.2 05:4 08:2
Vallejo, CA -12.1 05:4 09:2
Washington, VA -12.0 05:4 08:2
Redding, CA -11.8 06:1 08:2
Detroit, MI -11.7 05:3 06:4
Riverside, CA -11.4 06:1 08:4
Bloomington, IL -11.1 05:3 06:4
Bakersfield, CA -11.1 06:1 09:2
Greeley, CO -10.7 06:1 08:2
Salinas, CA -10.3 05:4 08:2
Santa Ana, CA -10.0 06:1 08:4
Sacramento, CA -9.9 05:4 08:2
Carson City, NV -9.8 06:1 09:2
Phoenix, AZ -9.3 06:1 08:2
Punta Gorda, FL -8.9 06:1 07:2
San Diego, CA -8.5 05:4 08:2
Warren, MI -8.4 05:3 06:4
Allentown, PA -8.2 05:4 08:2
Nassau, NY -8.1 06:1 08:2
Fort Walton Beach, FL -7.9 05:2 06:3
Santa Rosa, CA -7.9 05:4 08:2
Ocean City, NJ -7.6 07:1 10:2
Visalia, CA -7.3 05:4 08:4
Rockford, IL -7.3 06:1 09:1
Santa Barbara, CA -7.2 05:4 08:2
Worcester, MA -7.0 05:4 07:2
New Orleans, LA -6.7 05:4 07:3
Saginaw, MI -6.5 06:1 09:2
Oakland, CA -6.4 05:4 08:2
Fort Collins, CO -6.1 05:3 07:2
Portland, ME -5.9 06:1 07:1
Fort Lauderdale, FL -5.9 05:4 07:3
West Palm Beach, FL -5.7 05:4 06:3
Miami, FL -5.5 06:1 08:2
Edison, NJ -5.2 06:1 08:2
Los Angeles, CA -4.8 06:2 08:4
Denver, CO -4.6 06:2 08:2
Napa, CA -3.8 06:1 06:3
Providence, RI -3.6 05:3 07:2
New York, NY -3.5 06:2 08:4
Champaign, IL -3.5 05:4 09:1
Essex County, MA -3.1 05:3 06:3
Bethesda, MD -3.0 05:4 08:2
Boulder, CO -2.8 05:4 06:3
Yuba City, CA -2.6 05:4 06:3
Salt Lake City, UT -2.3 06:1 06:3
Boston, MA -2.2 06:2 06:3
Pueblo, CO -2.1 06:1 06:3
Prescott, AZ -2.0 06:1 08:2
Madera, CA -1.8 07:1 09:2
Colorado Springs, CO -1.6 06:2 06:3
Grand Junction, CO -1.3 06:2 06:3
Portland, OR -0.8 07:3 09:2
Lewiston, ID -0.8 07:1 08:2
St. George, UT -0.5 07:3 08:2
Honolulu, HI -0.3 07:2 08:4
Milwaukee, WI -0.3 07:2 08:3
Hagerstown, MD -0.2 07:3 08:2
Medford, OR -0.2 07:3 08:2
San Jose, CA -0.2 07:1 07:2
WEST CHESTER, Pa., Oct. 4 /PRNewswire-FirstCall/ -- Led by the
Southwest coast of Florida, house prices in many U.S. metropolitan areas
could see double-digit declines in the coming months and even into 2009,
according to a new study that assesses the severity of the unfolding
downturn.
Sharp declines, some nearing 20 percent, are forecast by a new study,
"Housing at the Tipping Point," released today by Moody's Economy.com of
West Chester, Pa. The greatest price drops, apart from Southwest Florida,
are forecast in many metropolitan areas of California, Arizona, Nevada, and
the greater Washington, D.C., and Detroit areas.
"The housing market downturn is in full swing," said Mark Zandi, chief
economist of Moody's Economy.com, who added that "to date, the housing
downturn has been generally orderly and is characterized best as a
correction and not a crash. Whether the housing correction unravels into a
crash will largely depend on the secondary or indirect effects from the
housing downturn."
Those effects include the impact on the job market, on consumer
spending via the housing wealth effect, on lending institutions, and on the
global financial system as mortgage credit quality weakens.
"The larger these effects, the more serious the blow to the broader
economy, which, in turn, will reverberate back onto the housing market,"
said Celia Chen, director of housing economics at Moody's Economy.com,
adding, "So far, the indirect effects from the housing downturn have been
very modest."
The unwinding of the long housing boom began in the summer of 2005,
when interest rates began to creep up. While the long-term interest rates
that govern the costs of fixed-rate mortgages have risen modestly,
short-term rates and adjustable mortgage rates have risen substantially
more. The housing downturn has become more dramatic with the departure from
the market of the "flipper," the so-called buyers who intend to re-sell
their properties quickly at a profit in an environment of rising prices.
"All of this has seemingly occurred overnight," said Zandi.
The study's results are drawn from mathematical models that incorporate
many types of data, including housing prices and statistics on supply and
demand, affordability, employment, and population movement.
Moody's Corporation (NYSE: MCO) is the parent company of Moody's Investors Service, a leading provider of credit ratings, research and
analysis covering debt instruments and securities in the global capital
markets, Moody's KMV, a leading provider of credit risk processing and
credit risk management products for banks and investors in credit-sensitive
assets serving the world's largest financial institutions, and Moody's
Economy.com, a provider of economic research and data services. The
corporation, which reported revenue of $1.7 billion in 2005, employs
approximately 2,900 people worldwide and maintains offices in 22 countries.
Further information is available at http://www.moodys.com.
Metropolitan Areas That Will Suffer House Price Declines
Peak-to-Trough Peak Trough
% House Price Decline Year/Quarter Year/Quarter
Cape Coral, FL -18.6 05:4 07:2
Reno, NV -17.2 05:4 08:4
Merced, CA -16.1 05:4 09:2
Stockton, CA -15.7 05:4 08:4
Sarasota, FL -14.0 05:4 07:3
Naples, FL -13.8 05:4 07:3
Tucson, AZ -13.4 06:1 08:2
Las Vegas, NV -12.9 05:4 09:2
Chico, CA -12.6 05:4 08:2
Fresno, CA -12.5 06:1 09:2
Atlantic City, NJ -12.2 05:4 08:2
Vallejo, CA -12.1 05:4 09:2
Washington, VA -12.0 05:4 08:2
Redding, CA -11.8 06:1 08:2
Detroit, MI -11.7 05:3 06:4
Riverside, CA -11.4 06:1 08:4
Bloomington, IL -11.1 05:3 06:4
Bakersfield, CA -11.1 06:1 09:2
Greeley, CO -10.7 06:1 08:2
Salinas, CA -10.3 05:4 08:2
Santa Ana, CA -10.0 06:1 08:4
Sacramento, CA -9.9 05:4 08:2
Carson City, NV -9.8 06:1 09:2
Phoenix, AZ -9.3 06:1 08:2
Punta Gorda, FL -8.9 06:1 07:2
San Diego, CA -8.5 05:4 08:2
Warren, MI -8.4 05:3 06:4
Allentown, PA -8.2 05:4 08:2
Nassau, NY -8.1 06:1 08:2
Fort Walton Beach, FL -7.9 05:2 06:3
Santa Rosa, CA -7.9 05:4 08:2
Ocean City, NJ -7.6 07:1 10:2
Visalia, CA -7.3 05:4 08:4
Rockford, IL -7.3 06:1 09:1
Santa Barbara, CA -7.2 05:4 08:2
Worcester, MA -7.0 05:4 07:2
New Orleans, LA -6.7 05:4 07:3
Saginaw, MI -6.5 06:1 09:2
Oakland, CA -6.4 05:4 08:2
Fort Collins, CO -6.1 05:3 07:2
Portland, ME -5.9 06:1 07:1
Fort Lauderdale, FL -5.9 05:4 07:3
West Palm Beach, FL -5.7 05:4 06:3
Miami, FL -5.5 06:1 08:2
Edison, NJ -5.2 06:1 08:2
Los Angeles, CA -4.8 06:2 08:4
Denver, CO -4.6 06:2 08:2
Napa, CA -3.8 06:1 06:3
Providence, RI -3.6 05:3 07:2
New York, NY -3.5 06:2 08:4
Champaign, IL -3.5 05:4 09:1
Essex County, MA -3.1 05:3 06:3
Bethesda, MD -3.0 05:4 08:2
Boulder, CO -2.8 05:4 06:3
Yuba City, CA -2.6 05:4 06:3
Salt Lake City, UT -2.3 06:1 06:3
Boston, MA -2.2 06:2 06:3
Pueblo, CO -2.1 06:1 06:3
Prescott, AZ -2.0 06:1 08:2
Madera, CA -1.8 07:1 09:2
Colorado Springs, CO -1.6 06:2 06:3
Grand Junction, CO -1.3 06:2 06:3
Portland, OR -0.8 07:3 09:2
Lewiston, ID -0.8 07:1 08:2
St. George, UT -0.5 07:3 08:2
Honolulu, HI -0.3 07:2 08:4
Milwaukee, WI -0.3 07:2 08:3
Hagerstown, MD -0.2 07:3 08:2
Medford, OR -0.2 07:3 08:2
San Jose, CA -0.2 07:1 07:2
Filed in: real-estate housing-data mainstream-media
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October 02, 2006
Realtor Bubble
Notice how the chart treads the 800,000 membership line for over a decade and then all of a sudden in 2002 there is a sharp increase to 1.4 million. If you go to www.salary.com, you’ll find that most agents only make about $30,000 per year. The top 5 percent of agents rake in the six-figure incomes but many agents chase the illusive “gold rush” only to find a sales job in a declining market.
The timing is bad for many that are jumping on the bandwagon lately. As was the case with technology, many made enormous amounts of money in the 90s decade. Yet like a drip from a leaky ceiling, the drops falling to the floor only indicate a larger problem. The pent up demand will only increase – by looking at this graph, it may be the case that 2007 will be another year of increasing demand for NAR membership. Why? Well what do you think the lay public thinks when they see for sale signs all over the place and many sellers blasting the media to sell a product. If anything, it will give the perception that real estate is still a hot deal.
Many on this board are immune to this logic since we swim in housing forums and blogs and won’t be surprised when the wave hits; but the common Dick and Jane will get hit and have their shorts knocked off like the adolescents taking their first swim in the ocean. The above graph shows the national hype and I find no better word than “obsession” regarding real estate. Why, for over 15 years does membership hover around 800,000 to a sudden doubling in only three years? Can it be a massive influx of advertising, media shows, and other propaganda?
Think of the media as taking Carleton Sheets, Robert Allen, and Donald Trump and instead of having them on 3AM with the other charlatans pumping colon cleaners we have given real estate the “ok” as a get rich quick for everyone. Yet, when everyone is rich I ask who is poor?
Filed in: Realtors real-estate
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