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New Home Sales...Fall

Discussions about the economic and financial ramifications of PEAK OIL

Re: Americans moving away from high home prices

Postby PrairieMule » Wed 07 Dec 2005, 13:21:24

I think folks that move to the Midwest will be in for a surprise. Although the Midwest has more affordable housing, it goes hand in hand with lower paying jobs, less opportunity, and higher state taxes. I found this true as a Dallas transplant from Oklahoma.

Bottom line when it comes to peak oil, taxes, energy, food, work, or lifestyle- no one place is perfect. Any move you make is just a trade off of old problems for new ones. Plan accordingly...
If you give a man a fish you will have kept him from hunger for a day. If you teach a man to fish he will sit in a boat and drink beer all day.
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Re: Americans moving away from high home prices

Postby MonteQuest » Wed 07 Dec 2005, 22:59:52

Just outside of Phoenix is the largest nuke plant, Palo Verde. Also, Arizona is self-sufficient in coal to fire it's powerplants.

Arizona is also the first state to require public utilities to generate a portion of their electricity through renewable sources.

In terms of hydro power, we have a lot.

SRP (Salt River Project) operates several dams along the Salt River and the canal system that produce electricity:

Roosevelt Dam
Horse Mesa Dam
Mormon Flat Dam
Stewart Mountain Dam
Blue Ridge Dam

Crosscut Hydroelectric Plant: It is located on a 116-foot drop in the Crosscut Canal. It began commercial operation in late 1915, has a generating capability of three megawatts (MW).

South Consolidated Hydroelectric Unit: Constructed in 1981, it is located on a 35-foot drop in the South Canal. Its generating capacity is 1.4 MW.
Arizona Falls: Our newest hydroelectric facility located on the Arizona Canal uses SRP water to generate clean electricity, up to 750 kWh.
Through contract power purchases, SRP also receives power from these hydroelectric sources:

Hoover Dam: 79 MW via the Arizona Power Authority
Glen Canyon Dam: 100 MW (less during winter months) via the U.S. Bureau of Reclamation's Colorado River Storage Project.
Parker Dam and Davis Dam: 31.7 MW total (less during winter months).

The issue will be cost.
A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
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New Home Sales...Fall

Postby cube » Fri 23 Dec 2005, 13:35:52

U.S. Economy: November New Home Sales, Equipment Orders Fall

I think this sums it up pretty well
$this->bbcode_second_pass_quote('', ' ')Dec. 23 (Bloomberg) -- Americans bought fewer new homes than expected in November and businesses trimmed orders for most types of equipment, suggesting two areas of strength in the U.S. economy are wavering.

Purchases of new homes fell 11.3 percent, the biggest drop in almost 12 years,
Doomers rejoice! Of course 1 month of data does not define a trend but I think that's a sign. What happens next will be pyschological. It all depends how people react:
1) Oh no the ship is sinking.
or
2) Steady as she goes arghhhh.

I think 2006 will be an "interesting" year....more so then 2005. :wink:
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Re: New Home Sales...Fall

Postby hotsacks » Fri 23 Dec 2005, 13:41:39

I'm betting it's a trend.
In October '04,I had 4 homes booked for building in 2005. As of this date,I have:0.
I'm not a doomer but I am rejoicing.
Maybe I need help.
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Re: New Home Sales...Fall

Postby Zorlag » Fri 23 Dec 2005, 14:48:01

Now we will see whether bubble is really bursting and if so where does money flood next. Gold? Stocks? Somewhere else? :P Could be a wild ride. I feel sorry for those caught in the mania and multi-apartment trap with lots of loan interest to pay.
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Re: New Home Sales...Fall

Postby stealthpot » Fri 23 Dec 2005, 15:21:29

$this->bbcode_second_pass_quote('Zorlag', 'N')ow we will see whether bubble is really bursting and if so where does money flood next. Gold? Stocks? Somewhere else? :P Could be a wild ride. I feel sorry for those caught in the mania and multi-apartment trap with lots of loan interest to pay.


Be carefull of what you wish for...

In the United States, for those upside down in a house with lots of loan insterest to pay, walking away and foreclosure are a real option. In most states, the borrower is not legally responsible for the negative balance on the loan. In this case, the lender is required to write of that balance as bad debt. Too much foreclosure and writing off bad debt by lenders in mass may cause a real landslide into recession. Lets all hope prices simply stabilize and appreciation returns to modest pre-bubble levels.
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Re: New Home Sales...Fall

Postby jaws » Fri 23 Dec 2005, 15:27:56

Obviously falling new home sales is going to result in industrial contraction. Home building was the only growth industry left in America.
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Re: New Home Sales...Fall

Postby hotsacks » Fri 23 Dec 2005, 15:38:56

$this->bbcode_second_pass_quote('jaws', 'O')bviously falling new home sales is going to result in industrial contraction. Home building was the only growth industry left in America.


Except for the 'end of empire' bears like:porn;gambling;armaments;drugs.These industries are flourishing,there's money to be made yet.
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Re: New Home Sales...Fall

Postby cube » Fri 23 Dec 2005, 16:01:38

$this->bbcode_second_pass_quote('jaws', 'O')bviously falling new home sales is going to result in industrial contraction. Home building was the only growth industry left in America.
The word " industrial contraction" may not sound like a positive word but if the resources was used for malinvestment (a bad investment) then a contraction would be a good thing. I believe economic growth is dependant on the production of useful products and services not production simply for the sake of production.

If economic advancement can be simply measured by how much gets produced and not whether there was a need for it then I propose we spend our resources building bridges to nowhere...like what's happening in Alaska now. The McMansion craze is one of the worst case examples of malinvestment IMHO...worse then the dot com bubble. The history books will record this McMansion mania right alongside with the south sea bubble and the tullip mania.

But of course the average Joe is not going to see it this way. No, he's not going to point the finger at himself...he'll look for an economic scapegoat. Anybody want to guess who's going to be the scapegoat when this bubble pops?
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Re: New Home Sales...Fall

Postby lakeweb » Fri 23 Dec 2005, 16:17:58

$this->bbcode_second_pass_quote('Zorlag', 'N')ow we will see whether bubble is really bursting and if so where does money flood next...


What 'money'?

The wealth of the U.S. consumer has been fed by this unusual appreciation in housing assets. Not from productivity. Money was created from an increase in debt by the consumer. If the bubble bursts, then the quality of that debt degrades accordingly. This, because you now have debt without asset backing. If the housing industry contracts the first sector to suffer will be the building industry. Where will they get new jobs? The consumer has lost his ability to tap housing to spend so they won't create new jobs. The demand for services falls and more unemployment. Defaults on debt increase, borrowing dries up, and the money supply contracts. This causes the value of goods and services to fall. Jobs are cut and borrowing for future activities dries up. So the money supply contracts.

Deflation is a vicious cycle if the underlying quality of debt is marginal. Savings rates are negative and an asset bubble has fueled the last bout of spending. So the quality of debt is in a rather poor condition.

What money?

Best, Dan.
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Re: New Home Sales...Fall

Postby Zorlag » Fri 23 Dec 2005, 16:38:26

You´re right since "money" in this case is what it is... paper wealth. Will Feds try flooding market with liquidity or what will happen? They are not going to report M3 figures anymore. I´ll be watching this one very closely... :twisted:
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Re: New Home Sales...Fall

Postby mattduke » Fri 23 Dec 2005, 16:46:43

$this->bbcode_second_pass_quote('Zorlag', 'W')ill Feds try flooding market with liquidity or what will happen?


According to this:

http://www.safehaven.com/article-4331.htm

they already have.

"The Federal Reserve has conducted one of the largest two-day Repo injections of money into the system since back in September 2001. On Wednesday they added $18.0 billion in reserves and on Thursday they added another $20.0 billion."
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Re: New Home Sales...Fall

Postby JustinFrankl » Fri 23 Dec 2005, 17:19:20

But aside from paper wealth, there does exist wealth that is backed by material resources. I'm guessing most of this wealth are in the hands of the upper class. I smell a revolution. Eviscerate the proletariat! :roll:
"We have seen the enemy, and he is us." -- Walt Kelly
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Re: New Home Sales...Fall

Postby Cynus » Fri 23 Dec 2005, 19:10:09

$this->bbcode_second_pass_quote('jaws', ' ')Anybody want to guess who's going to be the scapegoat when this bubble pops?

My guess is it will be illegal immigrants who are no longer "doing jobs Americans are unwilling to do" but are now taking "our" jobs.
But there's a future growth industry for you: working for the department of homeland defense rounding up 12 million+ people.
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Re: New Home Sales...Fall

Postby mekrob » Fri 23 Dec 2005, 21:12:00

Not to burst any of your bubbles, but the housing market is usually slow in the winter. Although a 10 percent drop is pretty heavy, it does not mean that a trend will develop. This is barring any future rises in energy costs which are not likely to happen (damnit, can't show sarcasm)
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Re: New Home Sales...Fall

Postby joewp » Fri 23 Dec 2005, 21:21:34

$this->bbcode_second_pass_quote('mekrob', 'N')ot to burst any of your bubbles, but the housing market is usually slow in the winter. Although a 10 percent drop is pretty heavy, it does not mean that a trend will develop. This is barring any future rises in energy costs which are not likely to happen (damnit, can't show sarcasm)


Even though Bloomberg doesn't mention it, that number is seasonally adjusted, so it's eleven percent less than a normal November.
See Business Week's article
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Re: New Home Sales...Fall

Postby Daryl » Sat 24 Dec 2005, 08:43:49

$this->bbcode_second_pass_quote('stealthpot', '')$this->bbcode_second_pass_quote('Zorlag', 'N')ow we will see whether bubble is really bursting and if so where does money flood next. Gold? Stocks? Somewhere else? :P Could be a wild ride. I feel sorry for those caught in the mania and multi-apartment trap with lots of loan interest to pay.


Be carefull of what you wish for...

In the United States, for those upside down in a house with lots of loan insterest to pay, walking away and foreclosure are a real option. In most states, the borrower is not legally responsible for the negative balance on the loan. In this case, the lender is required to write of that balance as bad debt. Too much foreclosure and writing off bad debt by lenders in mass may cause a real landslide into recession. Lets all hope prices simply stabilize and appreciation returns to modest pre-bubble levels.


I see you are new around here. 95% of the people on this site want there to be an economic collapse. Even worse, they want there to be a massive population "die-off". Read Montequest's post. He is the main prophet of doom. The rest are just his apostles.
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Re: New Home Sales...Fall

Postby Cynus » Sat 24 Dec 2005, 11:04:12

$this->bbcode_second_pass_quote('Daryl', 'I') see you are new around here. 95% of the people on this site want there to be an economic collapse. Even worse, they want there to be a massive population "die-off". Read Montequest's post. He is the main prophet of doom. The rest are just his apostles.

I bet if you asked MonteQuest, any almost any other "doomer," do you want there to be an economic collapse and massive die off, he would say "no." That is different from believing that there will be one. Monte gives arguments for his position, which we are free to analyze and criticize, and revise. Claiming that his arguments are invalid because he wants it to happen, is a fallacious argument. The idea that people only give arguments for things they want to happen, and are trying to manipulate others, is the kind of mislogism that is a real problem on the Internet and in society.
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Re: New Home Sales...Fall

Postby Euric » Tue 27 Dec 2005, 14:01:25

$this->bbcode_second_pass_quote('cube', '[')url=http://quote.bloomberg.com/apps/news?pid=10000006&sid=ao.snEJm2iL8&refer=home]U.S. Economy: November New Home Sales, Equipment Orders Fall[/url]

I think this sums it up pretty well
$this->bbcode_second_pass_quote('', ' ')Dec. 23 (Bloomberg) -- Americans bought fewer new homes than expected in November and businesses trimmed orders for most types of equipment, suggesting two areas of strength in the U.S. economy are wavering.

Purchases of new homes fell 11.3 percent, the biggest drop in almost 12 years,
Doomers rejoice! Of course 1 month of data does not define a trend but I think that's a sign. What happens next will be pyschological. It all depends how people react:
1) Oh no the ship is sinking.
or
2) Steady as she goes arghhhh.

I think 2006 will be an "interesting" year....more so then 2005. :wink:



It could possibly be a trend. It isn't possible for the American home owner to see his income decline and still be able to afford ever increasing home prices. When older dwellings start to exceed 200 k$ in value someone is going to say this home isn't worth what their asking. Then the desire to buy starts to drop off. I know we are talking about new homes, but if "pre-owned" homes are barely affordable, think how much more unaffordable a new home is. Then after you buy it, you still have to furnish it at a cost, that will surely but the average middle class family in bankruptcy.

Things are so bad, that lenders are offering 40 year loans.

But, you all can rest well tonight, because even if housing sales continue to drop, the government fudgers will cook the books and claim next month housing sales leapt 20 %, negating the November drop. If the Us can fib about growth and unemployment, they can do it with sales statistics too.
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