Layoffs Expected to Decimate Wall Street Ranks

Like I said before, 2/3 of GDP is consmer spending, so if everyone is worried about their jobs, and foreclosures are all around them, then we're in for a tough time.

The outlook for your home is shitty, hence people are worried. Ask a mortgage broker how many times they have done a cash out refi in the past couple of years for clients and folded credit card debt into the balance. If you were in this world, you would be scared.

PC, good points... I think people are misled by the "recession" in 2001. They saw a amrket scare, but they never saw the fallout from it.

I think a lot of folks just don't get how bad even medium recessions are. AND, because we never really had the "house cleaning" you get in a recession - 2001 just saw a new bubble start before everything truly bottomed - I think it will be even worse.

No real income growth, bloated government at every level, folks in record debt (and it will get worse as housing prices decline further), and this thing is going to hurt for a while.

I'm not talking about stats from a website. Talk to an actual person who earns a living originating mortgages. Anyone?

in 1995 we were pretty far into the digital revolution - Gates, Jobs, Ellison were all billionaires. Dot com fever was in full bloom with no end insight - I was well into my first start up that went public (small but public in 1997)

Money was easy to raise all you needed was an idea and a powerpoint.

So yes the outlook in 1995 for 2000 was pretty damn amazing much diffferent than today's outlook for 2013.

Keep talking tech guy you are digging yourself a bigger and bigger hole and showing your youth and ignorance

did I make your list steve?

The OCC released a report today showing that even after modifications to borrowers, 36% were more than 30 days late 90 days after the modifcation and 53% were more than 30 days late after 6 months. "Suprising, and not in a good way" was how the OCC responded.

"2001-2002 has nothing on where we are right now."

I should clarify - I was referring to the last BIG recession, and 2001/02 was not a big recession. I meant the nightmare that followed the '87 stock market crash - can't remember the technical time line of it.

"Like I said before, 2/3 of GDP is consmer spending, so if everyone is worried about their jobs, and foreclosures are all around them, then we're in for a tough time."

Once the lending market defreezes (which clearly I think will happen sooner than you) businesses won't be hurting as much, so consumers won't be so worried about their jobs anymore. Not to mention, Obama is already talking about the huge public works projects he plans to create to create jobs.

Once consumers are more secure about their jobs, which I think will happen relatively soon (Q1), I see us doing very well in the years to come.

"I'm not talking about stats from a website. Talk to an actual person who earns a living originating mortgages." - positivecarry

The stats on their website are accurate to reality. At least based on 1 data point. What are you implying though? That the rates are wrong?

"Keep talking tech guy you are digging yourself a bigger and bigger hole" - petrfitz

I could announce to Streeteasy that I plan to ritualistically slaughter 12 baby kittens tonight, and still not be nearly as far down the hole as you are.

Tech_guy,

When I say don't look at the stats, I mean talk to person about volume. There is NONE.
People are starving for business out there. People want to buy, but no one qualifies.

You really think people will be more secure about their jobs in 24 days when it's Q1? Seriously? Even if you mean February, you're crazy.

I should have clarified more - I meant end of Q1 (to be precise, Obama administration. And since nothing magical happens on Jan 20, there needs to be time for what he says and starts to do to make its way into people's predictions).

So you're saying that the big finance companies want to lend, but nobody qualifies? In the business loan sense. That's a very different answer. I asked why businesses are hurting - you answered that they can't get credit, and everybody needs credit. Apparently they can't get credit because they're hurting and don't qualify. Well thats begging the question - why are they hurting in the first place? What's making them no longer qualify for credit?

We raised the standards! Holy shit! Do I need to explain how the world works? If you were a lender, and people stopped paying you back, you stop lending to certain people.

Obama will do nothing to fix this. Banks will sit tight and hoard cash until the economy improves. Almost as bad as smoot-hawley.

"certain people" - subprime, of course. I never heard about a huge surge in non-finance businesses suddenly not paying back their loans. Do you have a link to support this claim?

"Obama will do nothing to fix this. Banks will sit tight and hoard cash until the economy improves."

If they want bailout money, they will lend:
http://www.google.com/hostednews/ap/article/ALeqM5i9CD6DUYZiQE0wbEoMa9dK4RfVmwD94UN5C80

Enough of this pissing contest. I don't need to post a fucking link to tell you I'm good at what I do and that I know what I'm talking about. The fucking market is going DOWN buddy, and to think anyone is going to be lent money in the foreseable future is naive. You work in tech, I work in finance, and we'll pick this back up in February and see how credit has improved.

"Enough of this pissing contest. I don't need to post a fucking link to tell you I'm good at what I do"

Pissing contest? Who ever doubted that you're good at what you do? I certainly didn't. I believe you completely when you say no loans are happening now.

We're not talking about your job, how good you are at it, or whether the reports of how much volume you're seeing are accurate or not. We're talking expectations for the future - a very different ball game. I'm sorry you're taking this so personally, and I'm sorry your field is in turmoil now, but that's why I'm asking for supporting information. If something is so obvious that you swear about it and say its like "the world works", surely a link would be easy to find? Everyday businesses defaulting on loans is very non-obvious. Its not like I asked for proof that subprime mortgages are defaulting.

Don't you think its more likely that your personal ties to the industry (and associated fears) are clouding your judgment of the future a bit?

"I should clarify - I was referring to the last BIG recession, and 2001/02 was not a big recession. I meant the nightmare that followed the '87 stock market crash - can't remember the technical time line of it"

Yeah, 1987 wasn't exactly humongous either. You realize we ended the year UP on the dow?
It, like 2001, was a trading-related market crash, not a purely economic one.

See what happens when you get an oil embargo... or the banks stop lending money.

I can't post information that I have, because it's not public. Leave it at that.

"So you're saying that the big finance companies want to lend, but nobody qualifies? In the business loan sense. That's a very different answer. I asked why businesses are hurting - you answered that they can't get credit, and everybody needs credit. Apparently they can't get credit because they're hurting and don't qualify. Well thats begging the question - why are they hurting in the first place? What's making them no longer qualify for credit?"

I think its pretty straightforward.... companies that didn't deserve credit got it, and now they need it even more. Those who need it the worst simply won't get it. Granted, many don't deserve it, but its not going to change the fact that there is going to be a LOT of laid off folks and businesses shutting down.

If you are wondering why these companies are doing worse than 6 months ago, its mainly because of consumer spending massive declines hitting companies that were overextended.

This is pretty basic stuff..

positivecarry and friends,

>> "Enough of this pissing contest. I don't need to post a fucking link to tell you I'm good at what I do and that I know what I'm talking about. The fucking market is going DOWN buddy"

leave tech_guy alone. he's just a bitter homedebtor who bought near the peak of a bubble and needs to defend/justify himself in order to get some sleep at night instead of staying awake and worrying about the apartment he bought.

he thinks he knows what he's talking about, except he really doesn't which makes him look like a fool to other people. just like the guy who think he's funny except nobody else thinks he's funny, but he's so stubborn and into himself that he continues to crack lame jokes thinking its funny at the expense and frustration of others.

i wasted enough time with him already, but look, he's a tech_guy and you're a finance_guy/gal so of course the tech_guy knows more about finance than the finance_guy/gal. duh! stop wasting your on him and move on. unlike spunky, there's no hope with this one.

positivecarry: If you have insider information, well thats very different and of course I'm unable to comment on that. But, that's quite a different tune than "Holy shit! Do I need to explain how the world works?", don't you think?

nyc10022: "I think its pretty straightforward.... companies that didn't deserve credit got it, and now they need it even more. Those who need it the worst simply won't get it. Granted, many don't deserve it, but its not going to change the fact that there is going to be a LOT of laid off folks and businesses shutting down."

That's very different. positivecarry is saying good businesses won't survive because they can't get loans. That's the unstable equilibrium that can't possibly last. If you're saying a lot of people are employed by bad businesses that need to go out of business in a massive house cleaning, well that's a very different (and more plausible) story. That's not what positivecarry has said, however.

MMAfia: I love it. I demolish your awful Ron Paul politics that nobody here agrees with, and your only response is petty ad hominem attacks and lame attempts to befriend anonymous strangers. Trust me, now that they know you want a gold standard, they won't want to be your friend. Have fun with your Ron Paul 2012 campaign - I'm sure it'll do SO much better than real estate, the economy, and everything else.

>So you're saying in 1995, the predictions about the economy in 2000 was better than the current prediction of the economy in 2013?<

Tech_Guy, going buy your name you of all folks should know that 1994-1995 was the beginning of the tech/internet boom which bolstered the economy for the next 5-6 years. The tech boom in no small way got WS off it's recession blues and Manhattan RE along with that of California began it's upward climb. Free trade agreements such as NAFTA and reduction in the capital gains tax rate (great timing for the small internet companies of the time) added fuel to the economic fire.

I would say the outlook in 1995 for the future was quite positive. Today, we have a long ways to go before the economic clouds begin to lift and a new sigificannt engine of growth remains MIA.

serge07: Everybody keeps misunderstanding what I mean. Obviously the market was moving positively in 95 and negatively in 08. I'm not talking relative change, but absolute productivity. Read my post to nyc10023 for an expanded explanation (not to be confused with nyc10022)

"Yeah, 1987 wasn't exactly humongous either. You realize we ended the year UP on the dow?
It, like 2001, was a trading-related market crash, not a purely economic one."

I meant the recession that followed, which I can't remember what year it began or ended. Yes, I remember that the Dow's "crash" only dipped and then rebounded quickly, with a couple of after-tremors in the following six months to a year, which also were erased. But that recession was severe with NYC unemployment somewhere near 10%. That's the last recession I look back on and remember being painful all around, with stock market losses, real estate prices crashing, lots of foreclosures, lots of businesses closing, and job losses. The last recession we supposedly had seemed like a blip to me. We're taking lots of hits in a compressed period this winter.

> That's very different. positivecarry is saying good businesses won't survive because they can't get loans.

Good businesses can be overextended. Which might mean they can't get further loans.
So are bad businesses.

Lots of business, good and bad, that otherwise might have been able to stay open, will close because of the credit situation.

Also, a lot of good businesses have become bad because of the bad credit situation. When their suppliers can't pay, etc...

So, you are talking about this as if its two completely distinct sets of companies.

it is not... which is why a huge portion of companies are getting smacked.

The banks are going to need to start lending money to businesses or it will get much worse. Loosening the credit markets and increasing consumer spending are the two key things that need to happen to try to make this snowball stop tumbling down the mountain.

Lots of ways to do these...not many of them good ways.

Time will tell....

nyc10022: your response essentially boils down to that there are no good businesses. You describe a lot of very bad business decisions and attribute them to good businesses - if you really think there are just many more bad businesses than I'm accounting for, say it outright. I don't think that's the case though.

As for the suppliers, suppliers don't pay businesses. You mean customers not paying up? Or suppliers going out of business?

Are there links that you have to support that this is actually happening, or is this all just academic?

As a tangent, I like the public works projects that Obama is already talking about. Many new jobs are going to be created from it. With the threat of deflation (caused by massive credit-induced inflation that's now gone) - the government will have much more leeway to spend and inflate us back up to "normal" (pre credit collapse) - no? I readily admit that I'm no expert in this so I welcome comments explaining why this belief is wrong.

> nyc10022: your response essentially boils down to that there are no good businesses.

No, it doesn't. I think you just don't understand it.

In a credit crisis, good companies can't get credit. That doesn't make them bad companies, it makes it a CREDIT CRISIS.

> Are there links that you have to support that this is actually happening, or is this all just
> academic?

Did you miss the last 6 months? This has been well covered for quite some time. Even commerical paper simply isn't selling. If you think this is academic, perhaps that is why you don't understand this.

The credit market for business has been HORRIBLE.

Again, thats why it is called a CREDIT CRISIS.

Where you been?

> With the threat of deflation (caused by massive credit-induced inflation that's now gone)

Based on this, I'm not sure that you understand what deflation is either.

"In a credit crisis, good companies can't get credit. That doesn't make them bad companies, it makes it a CREDIT CRISIS."

Now we're talking ourselves in circles. I ask why can't good companies get credit, you list a bunch of bad decisions they might have made (overextending themselves, etc). You still haven't explained why a good company in a good position can't get credit.

"Even commerical paper simply isn't selling"

I said many posts above that I recognize that this is happening now, but I'm trying to figure out why. And what makes everyone else so sure that this unstable equilibrium will last another year, as others say (lenders refusing to lend to good companies - how is that beneficial to *anyone* involved?)

If your best answer to "why" is "just because", you're not contributing much useful content. Maybe there isn't much useful content to contribute at all, and I'm wasting my time asking.

"Based on this, I'm not sure that you understand what deflation is either."

I know ultimately its a measure of the value of money. But its very tightly correlated with money supply, no? Loose credit increases money supply. Tight credit decreases it. In a short period of time we went from extremely loose to extremely tight. That's not deflationary?

"I demolish your awful Ron Paul politics"

Puaaahahahaha... what on earth is your infatuation with Ron Paul?

I don't care about Ron Paul, really. He could disappear from this planet and I wouldn't care.

Demolished? Give me a break tech_guy. Seriously, leave the complicated Finance and Economics issues to those who actually understand and do it for a living. Stick with tech instead and you will stop making a fool out of yourself on this board with your JV commentary.

The only demolishing going on here is your credibility. As I said earlier, you are just one of many in the line of lemmings jumping into the cauldron of fire. One by one they are disappearing from this board... once they are all but gone, then we know we are close to a bottom.

This was exactly how it was like during DotBust. In the stock forums, even while some serious, serious tanking was going on, there were always those lemmings who would either try to call the bottoms or morph data into their hope that the fall was but a pause and that it wouldn't be "that bad".

It was only when all those lemmings disappeared from the board that the bottom actually was made.

"Now we're talking ourselves in circles. I ask why can't good companies get credit, you list a bunch of bad decisions they might have made (overextending themselves, etc). You still haven't explained why a good company in a good position can't get credit."

Just because you can't understand it doesn't mean I'm talking in circles.

Good companies can't get credit because banks are afraid of further drops in the economy, which will make even good companies have cash flow issues. I'm not saying this is all rational, but if you think that there is plenty of credit out there for good companies, they you haven't been following what goes on.

"I said many posts above that I recognize that this is happening now, but I'm trying to figure out why."

Do some reading then. This has been well covered in the press.

"And what makes everyone else so sure that this unstable equilibrium will last another year, as others say (lenders refusing to lend to good companies - how is that beneficial to *anyone* involved?)"

I think you are missing the point. No one is saying that this is a good thing, and the government is trying to fix it, and the world wants it to be fixed.

That a problem exists doesn't mean folks want it to exist. That is simply illogical.

And who said they are sure that this will last another year? I don't think anyone has said that. The options are this gets worked out with brute force (monetary policy and the government becoming a lender itself, which has already happened), or this collapsing the economy.

Only you have claimed it will stay as is...

"Loose credit increases money supply. Tight credit decreases it. In a short period of time we went from extremely loose to extremely tight. That's not deflationary?"

You definitely don't know what you are talking about here. Money supply is NOT credit. You should do some reading before you comment any further on this.

"This was exactly how it was like during DotBust. In the stock forums, even while some serious, serious tanking was going on, there were always those lemmings who would either try to call the bottoms or morph data into their hope that the fall was but a pause and that it wouldn't be "that bad".

Great analogy, MMA.

a few disjointed comments:

1. good companies are getting plenty of credit, they just don't like the terms. It is pretty frightening to think some companies whine that they can't function with short term funding at 5%. Granted, for a brief period in geologic terms they received funding at 120 over the curve.

2. the single biggest reason why banks have limited lines to certain borrowers and industries is because of the fear of their own balance sheets. This is most obvious in the short part of the curve, <6 months at almost nonexistent treasury yields and 2.5 trillion in fails outstanding.

3. And this is the most important part, if you, me, foreign govts and cash rich corporates won't invest in money funds, which in turn buy CP, why should banks?

It's amazing, isn't it? You would think he would have at least 1 or 2 friends that works at a hedge fund or in some financial capacity so they could tell him what's going on....

major typo

2. should read:
2. the single biggest reason why banks have limited lines to certain borrowers and industries is because of the fear of their own balance sheets. This is most obvious in the short part of the curve, if you, me, foreign govts, cash rich corporates won't invest in money funds, which in turn buy CP, why should banks?

"It's amazing, isn't it? You would think he would have at least 1 or 2 friends that works at a hedge fund or in some financial capacity so they could tell him what's going on"

Or picked up a newspaper or turned on CNBC in the last 6 months...

My fixed income trader client has nothing to do all day, my client at one of the biggest commercial finance lenders out there tell me they are making no loans unless it benefits another division, I could go on and on. All of my clients that work in finance tell me the same thing. Lending is dead and it's not going to come roaring back anytime soon....

Hey Tech_Guy want to know a little secret? The national debt now is about 12 Trillion dollars which includes the recent bailouts of 700 billion, AIG, Bear Sterns etc and the 2 trillion that was lent out thee FED window with no transparency. How long do you think the rest of the world is going to keep financing us so we can spend like drunken sailors? The FED borrows and the tresury prints it like fucking magic! The federal government can't bailout a lemonade stand, this is basically a phony economy and there will be a big price to pay soon.........

Drunken Sailors? Let me guess McHale, you are an apologist for America. What kind of assets do you recommend for Americans? Let me guess, you are all about gold and being green and driving hybrids and crap.

vwear, do you even ATTEMPT to add anything to this board?

I guess my post went over your head? The Americans who used credit cards with reckless abandon, used their homes as ATM's and HELOC's who brought with no money down and are all collapsing now under a mountain of debt and now feel entitled to get a bailout? Or the Wall Streets crooks and Fat Cats who destroyed my IT company from a leveraged buyout by corporate raiders using junk bonds to destroy a 2 billion dollar company with 16,000 US employees 3 manufacturing plants in Mass after they saddled us with 1.5 billion of junk bond debt that in five years did us in in 1989? In the two decades since then, I had been waiting for the end of Wall Street. The outrageous bonuses, the slender returns to shareholders, the never-ending scandals, the bursting of the internet bubble, the crisis following the collapse of Long-Term Capital Management: Over and over again, the big Wall Street investment banks would be, in some narrow way, discredited. Yet they just kept on growing, along with the sums of money that they doled out to 26-year-olds right out Harvard with financial engineering degrees to perform tasks of no obvious social utility. Why bother to overturn your parents’ world when you can buy it, slice it up into tranches, and sell off the pieces?

McHale, are you quoting the Michael Lewis article "The end of wall st".?

Wow, I go out for drinks for a few hours, and all this personal bashing comes in. Lets start with the best:

MMAfia: "Demolished? Give me a break tech_guy. Seriously, leave the complicated Finance and Economics issues to those who actually understand and do it for a living."

Is finance and economics so Holy to Thou that you feel the need to capitalize His Good Book? The way you talk about gold, it sure seems like you feel it has a divine power.

Do you deny that you want for the United States to go on a gold standard? You already stated so earlier and conveniently dance around the subject here. Say it outright, don't be a coward about it. Its what you believe, so why are you hiding it so? Afraid that once its out there, everybody here will think you're even crazier than me?

nyc10022: I forgot that you said earlier that what's said here on these boards materially impacts real estate prices. That your messages will help get you a lower price later. That's why you flat out refuse to acknowledge the mere presence of even slightly positive data.

positivecarry: You're clearly taking this much too personally. You're jumping back and forth between "I have insider information" and "this is ridiculously obvious" - which doesn't lend much to your credibility. You still haven't explained why people who's job it is to lend would refuse to lend to a model customer. Even your fellow bears admit that this happens, yet you (quite stupidly) mock me for asking what you say is such a dumb question.

McHale: As others told me earlier, the Fed is able to sell debt at yield rates not seen since the Great Depression. Apparently the world doesn't really mind what the Fed is doing. Perhaps its because they know that little secret you left out - the Fed is getting equity stakes in these companies (as a taxpayer, I'm positivecarry's new boss! ;) ) and may very well turn a profit on these deals.

Ironically, the 2 things the b-school drones here mock me for most, thinking gold has no intrinsic value, and being bullish on US stocks, are 2 things that Warren Buffett agrees with me on. I appreciate all your input, but with him in my corner, you're going to need to do a *little* better than petty ad hominem attacks.

He can be wrong. He has been wrong before. But I need more than ad hominem to side with anonymous b-school drones over Buffett.

Tech-guy, Buffett's stock market investment was $5B of Goldman Sachs 10% perpetual preferreds plus warrants (currently way out of the money). Hey, I'd lend Goldman some cash at 10% perpetual preferred. The "preferred" part means you get to step in front of the common stock and probably unsecured creditors (who knows what the final term sheet looks like) in the event of a liquidation. The warrants mean if the stock recovers he buys it cheap.

This wasn't a stock market investment. It was a fleecing.

Buffett has commented publicly that he is bullish on US stocks going forward. Of course he gets better deals than you and me, but what he says for every day Americans is still bullish.

Buffett says he likes stocks then he goes out and buys 10% perpetual preferred. If he was bullish on stocks why didn't he buy stocks? He doesn't have an ownership stake in Goldman. Goldman owes him money. That's not being bullish in US stocks. That's saying, "I don't think Goldman will become another Lehman, might become a Merrill or a Bear, but definitely won't become a Lehman". Not very bullish stance in my opinion.

positivecarry, please keep posting to counter the kool aid drinkers.

Here's a real world mtg scenario: In July, I asked my mtg lender (a portfolio lender) to refi a commercial mtg & they offered 10 years fixed at 7%. 2 weeks ago, I went back & checked rates. The best they could offer was 5 yr fixed at 8%. I have a good 10 yr track record with this bank & the underwriter, who I've known for years, sounded very depressed & apologized to me for offering such crappy terms.

Also agree re: retail is doing badly. Saw this sign in a small shop on Lex in the 70s: "20% off everything sale due to bad economy".

So, all of you who don't want to hear the bad news, go buy now or you'll be priced out forever.

http://www.fool.com/investing/value/2008/11/28/is-buffett-insane.aspx

I know that for a lot of people, its wise to discount what they say and read into what they do. But when the 2nd richest man in the world, who recently pledged 80% of his net worth to charity, says something about finance, I'm going to take him at his word. Such a person doesn't strike me as the shill type. I have a hard time believing that he's lying with ulterior motives.

He's buying preferred stock because he can buy preferred stock. Why waste money on common stock when he can get better deals? For peons like you and me, however, his advice is bullish. I trust that advice to be honest.

If I would have told you one year ago that the curve was inverted and that we are going into a recession, would you even know what I'm talking about?

Take a look at muni bond fund, and look at the NAV dropping every day. It's doing that because there is no new money flowing in, and they are having net redemptions. The market is at a standstill. It doesn't care what buffet says. The market will always tell you what is going on before some idiot on CNBC does.

"If I would have told you one year ago that the curve was inverted and that we are going into a recession, would you even know what I'm talking about?"

Yes

"The market is at a standstill. It doesn't care what buffet says. The market will always tell you what is going on before some idiot on CNBC does."

You group Buffett together with some idiot on CNBC? That's much more embarrassing than not knowing how to read yield curves. I don't give Buffett's predictions because the market cares what he says (though they do happen to care quite a bit). I give it because he can read a yield curve (and all the other data, including the insider info he got to see at Goldman) *FAR* better than you or me. He reads that stocks are discounted enough for all the negative news out there, and are now priced attractively.

Sep-24-08 Buffett says: I'm bullish on stocks. "Invests" $5,000,000,000 in Goldman 10% preferreds. Average Joe says "I'm with you Warren, my hero" invests $50,000 in stocks e.g. S&P 500 index.

Dec-8-08 Buffett is up 2%, $100,000,000 in dividends (75 days = 20% of year)
Avg Joe is down 25%, -$12,500 (index at 909 vs 1185

Buffett's "stock market investment" outperforms the average Joe's investment by 27%. What a genius he must be. I wonder what Average Joe will do next time Warren makes a proclamation.

So if you can read a yield curve, why are you posting here? Clearly you should be smart enough to read the tea leaves and see where we're going. If you can't, then I guess you can't.

Except it was Oct 16 where Buffett wrote his NYTimes op-ed:

http://www.nytimes.com/2008/10/17/opinion/17buffett.html

And his personal (non-Berkshire) holdings, which is what he was talking about, don't get to buy Goldman preferred either. He does say: "I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month — or a year — from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over."

This is really basic stuff. Surely a young, inexperienced kid like me with absolutely no financial degree or certification of any kind shouldn't have to describe these *basics* to you b-school'ers? Or if it doesn't fit into the rigid rules you memorize but can't explain, debate, or question, your only recourse is to mock it?

Regardless, you're quibbling over petty details when the original point still stands: If you're making stupid, petty, uncalled for ad hominem attacks against a belief that Warren Buffett holds, you are unequivocally wrong. He may make mistakes, but no investment advice he gives is ever so stupid as to not even warrant civilized discussion.

"So if you can read a yield curve, why are you posting here? Clearly you should be smart enough to read the tea leaves and see where we're going. If you can't, then I guess you can't."

You're posting here. Are you saying you can't read the yield curve?

I read the yield curve for a living. I'm in finance. You like real estate as a hobby. I'm not the amateur here.

popsitive if you check his other posts you see that tech_guy is pretty levered up in real estate. He bought an apt fairly recently. It's more than a hobby for him.

Seems like tech_guy can't wrap his brain around the difference between common and preferred so I'll leave it alone.

"nyc10022: I forgot that you said earlier that what's said here on these boards materially impacts real estate prices. That your messages will help get you a lower price later. That's why you flat out refuse to acknowledge the mere presence of even slightly positive data.

Yes, I recognize the tech guy pattern. Get proven wrong (and out of your league) and resort to your old shtick of lying.

"Seems like tech_guy can't wrap his brain around the difference between common and preferred so I'll leave it alone. "

If that were his only mistake, he'd be way ahead of where he is now.

You're leaving it alone because you've lost. That, or you're too stupid to understand the following, from the 2nd paragraph of Buffett's op ed piece linked above:

"So ... I’ve been buying American stocks. This is my personal account I’m talking about, in which I previously owned nothing but United States government bonds. (This description leaves aside my Berkshire Hathaway holdings ..."

I trust that you are, in fact, intelligent enough to understand the above. So I'll conclude you're leaving it alone because you know you lost the argument.

nyc10022: Lying? I've linked this for you before when you accuse me of lying. Your quote, link below to verify (and see full context): "But, RE markets are determined at the margins, so I think the "enlightened" are going to have some impact here. ... You only need a few streeteasy crazies to start the descent down, and once that happens, its a snowball rolling downhill."

http://www.streeteasy.com/nyc/talk/discussion/5620-the-internets-ability-to-accelerate-price-correction

I get it - you act crazy, doom and gloom, refuse to acknowledge the mere presence of positive data, make fun of a broker who shares a story about a good deal they just closed, all because you need to be that crazy pushing real estate down. For your own future purchase, which you don't deny you're looking to buy if prices go down enough.

Tech guy, we get it. You don't know finance, you don't know real estate. You just like the sound of your own voice....

Obviously tech_guy doesn't understand if he recently bought and became a homedebtor (perhaps one of the last suckers/lemmings) - most likely a younger person who hasn't been through a real (2001 doesn't count) recession as an adult. But of course is an expert at it, even more so than people who actually work in finance and real estate.

But alas, that's how they learn, by going through the pain themselves.

MMAfia: Of all the many ad hominem attacks I've gotten, nobody has *ever* accused me of being a coward. Yet you clearly show your spineless self in your continued refusal to admit that you want for the US to adopt a gold standard currency. (Or, if you don't want it, deny it outright - but I know from earlier posts you've made that you clearly do. Its practically a religion to you).

Even your fellow bears will tell you that wanting a gold standard is 10x dumber than anything I've ever said or done. Cowardly wanting it, refusing to admit it outright, is just sad.

Did we really just get into an "I'm braver than you" argument on this anonymous board?

We've entered a new realm of stupidity.

> most likely a younger person who hasn't been through a real (2001 doesn't count)
> recession as an adult.

Exactly what I've thought for a while now...

> But alas, that's how they learn, by going through the pain themselves.

Unfortunately, yes.

This is what happens when a little air slips out of the bubble. People get upset. Your home is never an investment. Live that credo and you'll be fine.

I never said it was an investment. People who can't argue economics with me (I don't blame them - Buffett is a formidable force on my side) resort to ad hominems, often mentioning my purchase. I've said this before - my apartment can disappear, and while I'd be sad, I'd still be in a decent financial position. I didn't buy it as an investment - I bought it as a home.

That viewpoint on my apartment doesn't help their ad hominem attacks, so they conveniently ignore it, and portray me as someone who will starve on the street if I can't flip the thing next month at a 10% profit. Don't worry guys, I'm doing just fine for myself.

positivecarry,

As you can see, there's a lot of schmos on this board who like to engage in nonsensical pissing matches.

dwell, what's your contribution to the boards? positivecarry's personal cheerleader? There are 2 different flavors of kool aid flowing freely. I know I'm drinking one, and deny it all you want, but its quite obvious you (and many others) are drinking the other.

MMAfia, why do you even read tech_guy aka LICComment? Both of whom singularly insist that the mortgage tax deduction reduces the cost of home ownership.

No it doesn't. It reduces your taxes. Therefore, it increases the price of homes.

> As you can see, there's a lot of schmos on this board who like to engage in nonsensical pissing
> matches.

You said that, and then the others came and joined...

Thank you steve - it can only take your special kind of ignorance to bring levity to this discussion :) I was trying to get that out of MMAfia's gold standard views, but he's too scared to admit that. I'll give you one thing steve, you've never been afraid to express your views, embarrassing as they may be.

I'm done with this thread. I know you'll all try to get the last word in - all yours (yes, I'm guilty of trying to get the last word in myself often, but not this time). Cue ad hominem attacks - I'll be off betting on the side of Buffett, enjoying my fun and secure job, and enjoying the apartment who's after tax costs are lower than all equivalent rentals. I know, I know, such a terrible life filled with terrible life choices that will lead me to the poor house before I hit 30.

"Your home is never an investment. Live that credo and you'll be fine."

Very well put. Your home is shelter, and it is amortized as capitalized rent. That's it.

Tax deductions reduce taxes. That's also it.

Interest rate reductions reduce interest. That's also it.

Reduce interest rates, home prices rise.

Reduce taxes, home prices rise.

To the very point where they equal rent.

Which is why, in the past, if you bought a property to rent out, you would rent it out for precisely your carrying costs. Only under bubble conditions do people think there is some inherent reason why they should own a place to live rather than rent one, when owning is twice as expensive.

> enjoying the apartment who's after tax costs are lower than all equivalent rentals

Only if you exclude the cost of potential loss.

By owning OR renting people are overpaying for shelter! There should still be space in various homeless shelters in the city for the next bunch of smart guys who truly want to reduce their housing cost. There is plenty of sleeping quaters in subway cars too. Why pay a dime for shelter when you can get it for free?

So homelessmess > renting > owning. The hell with standard of living and property rights.

My bad... the monthly cost for unlimited access to shelter in the subway system is about $80 and subject to inflation. Defintely more than a dime but the square footage is fantastic, and you can't get any closer to transportation. Defintely beats renting or owning anything above ground.

I never had any prejudice against homeless people but I definitely haven't paid enough respect to them. Now I realize many of them might have PHDs in Spanish and have figured out the ultimate truth in real restate, finance and life itself a loooong time ago.

Did tech_guy infer that he was brave because he went out and bought a 1 bedroom apartment?

Tee hee hee.

Brave is quitting your corporate law gig and buying a building in the 70's in the Lower East Side on a credit card. That is how Paul Stallings got his start.

Tech_guy is just a young asshole who listens to no one, thinks he is smart, and basically makes a pedestrian move in buying a 1 bedroom and thinks he is brave....

"MMAfia, why do you even read tech_guy aka LICComment?"

Ahhh... stevejhx, you know how it goes... it's pure entertainment.

=D