[I_Like_Plants]

The thing that's bothered me all along about the real estate bubble is, in a normal market, it costs the same to buy or rent. A little more upfront to buy, but you get that back when you do your taxes.

Now, you have things like .... my present apartment is $1050, but buying the equivalent place turned into a condo would cost me at least $3000 a month.

This is why right now, it makes a lot more sense to rent than buy.

[Tuike]

http://www.mortgageimplode.com/

This link was in another thread, I'll spam it here too. There are 30 subprime lenders gone bankrupt in just two or three months.

[DantesPeak]

$this->bbcode_second_pass_quote('ElijahJones', 'I')'ll tell you what happens. The slow march of time, and depletion raises the core prices in the economy just at the time that your funny loans are about to be adjusted. So who wins? The folks who used 9/11 to offer you a loan you and they knew you could not afford. Long term noone is going to win because the housing crash of the next couple years will never be forgotten, books will be written about it.

[master_rb]

I_Like_Plants, you got good point that's why i'm not buying a house till things get back to normal

and if all the doomers are right probably will never have a chance to buy one

[Eli]

Wow Dantes thanks for that cheery outlook.

57 billion in subprime loans. Damn!

Ok,Gm is even more screwed than before. GMAC was supposed to be the valuable piece of the company now it looks like it is the part that will drag the auto division down. And that is really saying something considering the how bad the auto division is.


The subprimes is where the growth in the housing has been coming from and it is going to take down all the big lenders.

The subprime market didn't come out of nowhere all the major banks created new companies to make the loans. As the subprime lenders go tits up it they will cut deep into all the major banks.

My dear Lord this is going to be ugly.

Goldman, Merrill Almost `Junk,' Their Own Traders

[DantesPeak]

$this->bbcode_second_pass_quote('Eli', 'W')ow Dantes thanks for that cheery outlook.

57 billion in subprime loans. Damn!

Ok,Gm is even more screwed than before. GMAC was supposed to be the valuable piece of the company now it looks like it is the part that will drag the auto division down. And that is really saying something considering the how bad the auto division is.

My dear Lord this is going to be ugly.
[/url]

[fireplaceguy]

Retiree pension and healthcare obligations would have eventually sunk the company anyway - we should look at the GMAC debacle as merciful - it shortens the suffering of the patient.

But not to worry - the talking heads on the Sunday shows said this is just a minor correction we're seeing...

[I_Like_Plants]

master-rb - you are smart. Remember, in a normal market, renting = buying, in reality, buying means you're making a promise to pay X amount for 20 or 30 years, you're giving up mobility.

This market is SO far out of whack it's amazing. It takes a lot of work to realize this though, the average 'Merkin is getting a constant barrage of "real estate ALWAYS goes up!" and all that BS, everyone around them is buying, etc. But, a few brave souls have worked the numbers and shown that a renter can save up money and rent all along, and at the end of 30 years have enough to buy the house outright plus an extra quarter-million to play with, if I remember correctly. But that's assuming things will stay constant, and of course they won't. We're in the equivalent of the 1920s right now, houses were still cheaper in the 1950s and there'd been a war and a depression in between.

Right now my inclination is to invest in SKILLS SKILLS SKILLS. Farming (food will never become cheaper and organic farming pays well) carpentry, medical/vet skills, music (people will really crave it when the lights go out) etc.

[username]

[I_Like_Plants]

Ahh, Bob The Angry Flower....... love that strip most of all!

[seahorse2]

Subprime lending collapse continues to spread outwards.

$this->bbcode_second_pass_quote('', 'L')ehman Cuts Prime Mortgage Lenders on Spillover From Subprime

By Will Edwards

March 5 (Bloomberg) -- Lehman Brothers Holdings Inc. reduced its investment rating on U.S. mortgage companies including Countrywide Financial Corp. because a surge in loan defaults is showing evidence of spreading beyond the riskiest credits and the Federal Reserve hasn't cut borrowing rates.

[seahorse2]

News of subprime lending collapse spreads and affects market.

Yahoo News

[I_Like_Plants]

This is interesting - a friend of mine has been essentially living off of his house refinances. Well, real estate has leveled off and even gone down a bit, and my friend is still refinancing because he has to - there's no way a respectable bank is doing this, it must be a subprime lender. But, if the subprimes crash, what I'll see is my friend losing his house and probably moving into an apartment.

It's a friend in the same biz I am, I used to buy a lot of good stuff from him, but I don't buy from him any more because he's not getting much new stuff, and also because he'll lie about stuff because he needs the $$.

[TommyJefferson]

$this->bbcode_second_pass_quote('I_Like_Plants', 'I')t's a friend in the same biz I am, I used to buy a lot of good stuff from him, but I don't buy from him any more because he's not getting much new stuff, and also because he'll lie about stuff because he needs the $$.

[I_Like_Plants]

No no, not illicit drugs, there's not even any money in that, only stupid hillbillies and the ignorant portion of other groups get involved with that.....

Nope electronics junk. There will be *some* need for a while but it will peter wayyyyy out.......

[seahorse2]

Bernanke urges Congress to bolster regulation of Fannie Mae and Freddie Mack to "guard against any danger their debt poses to the overall economy."

$this->bbcode_second_pass_quote('', 'W')ASHINGTON (AP) -- Federal Reserve Chairman Ben Bernanke urged Congress on Tuesday to bolster regulation of mortgage giants Fannie Mae and Freddie Mac, and suggested limiting their massive holdings to guard against any danger their debt poses to the overall economy.

[PenultimateManStanding]

$this->bbcode_second_pass_quote('seahorse2', ' ')
So, after reading Greenspan's warning above, do you think the subprime loan issue will adversely spread to the whole economy?

[Eli]

This is complete bull, there was a big turn around today in the market as far as the subprime lenders go.

Bloomberg

My bet is this is PPT at work. The Fed already has too close a relationship with the private banks. To head off a collapse they lend funny money to the major banks propping up there own shill crap loan companies.

[cynicalheretic]

$this->bbcode_second_pass_quote('Eli', 'T')his is complete bull, there was a big turn around today in the market as far as the subprime lenders go.

[seahorse]

At one time, I said the difference between a "soft landing" and a "hard landing" was this: a soft landing only affecting the homeowner and builders. A "hard landing" was one that affected the banks. Seems like a hard landing, which was the concern voiced by both Greenspan in 2005 and Bernanke just this month, may be more likely than not. See this article: "Subprime virus on Wallstreet." by Forbes.

$this->bbcode_second_pass_quote('', 'E')leven big banks along with an activist hedge fund manager could be left holding an empty bag after New Century Financial disclosed a criminal probe into the trading of its securities in the days before an earnings restatement last month.