C'mon baby capitulate, throw in the towel, we're almost there, let's bottom already.

steveF -- we all only wish it would happen.

it will, manhattanfox, it will.

"Well when the money's all gone, I think of home, I... I think of something specific. I think of my, my hammock in the backyard or my wife pruning the rosebushes in a pair of my old work gloves."

You should have cash.

How can we bottom when the real fireworks haven't even started yet?

Daddy, are we there yet? are we there yet?

NO!! We are soooo not there yet.

MMafia, another 22 trading days like today and the S&P/Dow are @ ZERO. Does that put a bottom into perspective for ya? There is despair everywhere, we just need to wash out those last sellers, so we can hit bedrock.

rosebushes... is that what they call it now?

Ahhhhhh the market..... I thought it was Las Vegas... can someone on this board help me move 3 tons of dry pasta into my bomb shelter on CPW and 59th street at midnite? I'm wearing a sombrero with a 3 legged chihuahua....

Getting close...

steveF,

nothing goes straight up or straight down. could there be a temporary bottom put into place soon? sure.

but if we are talking about THE bottom, that can't happen until the main crisis hits.

all the stuff going on right now is just appetizer finger food. the main course is still on its way. don't get too full by eating up too much of the appetizers. save some space for the main course.

MMafia, what do you believe the main course/crisis will be.

mets2009,

international currency crisis. look out. be prepared. do your own due diligence. don't get caught off-guard, because just like the equities crash came late last year, the real crisis will come just as swiftly, but its effects will be much more devastating to the sovereign entities involved.

MMafia...can you please clarify the international currency crisis? IMO, odds are strong that we are at/near a bottom.

MMAfia: This Blogs for you....http://www.haloboyle.com/

What happens when banks start reporting losses on commercial real estate, credit cards and auto loans and securitzation?? market up? how about the unrealized losses still to be taken on Option ARMs?? market up? we are in a bear market for a while, ultimately till S&P 550 or so with a few small rallys.

When the S&P gets to the 500's we'll be ready to start thinking about 7% annual return...until the next bubble hits. Remember, we can't start the next bubble (Real Estate/Credit/Equities) until the majority of the participants in the current bubble are wiped out. Lack of memory creates bubbles.

MMafia, watch out for Russia or the Swiss or the EU dumping gold.

theburkhardtgroup,

sorry, but i don't synthesize into my analysis blogs that have little or no respect from the economic academia field.

instead, how about reading more substantive content, such as the highly respected think tank "Europe2020" and its sub-site, the GEAB which was created back in 2006 specifically just to analyze the soon-to-come (now ongoing) global crisis instead?

here's a freebie they offer to the general public....

http://www.leap2020.eu/GEAB-N-32-is-available!-4th-quarter-2009-Beginning-of-Phase-5-of-the-global-systemic-crisis-phase-of-global-geopolitical_a2805.html

people, don't get sidetracked by blogs like the one theburkhardtgroup linked to.

80s Man,

Do you even know what is happening in March this year with respect to Central Banks and Gold? Too funny.

Didn't mean to sidetrack you, I just happen to know the writer.

MMAfia: I guess we better start stocking up on the canned goods and shells.

theburkhardtgroup, my misunderstanding and apology.

to those who might question the economic think-tank's ability to forecast, i remember back in 2/2008, they release the following:

http://www.leap2020.eu/Global-systemic-crisis-September-2008-Phase-of-collapse-of-US-real-economy_a1298.html

"According to LEAP/E2020, the end of the third quarter of 2008 will be marked by a new tipping point in the unfolding of the global systemic crisis."

So, back in Feb 2008, they foretold of a "tipping point" at the end of Q3 2008, which is end of Sept 2008.

And so the market did come crashing down at the end of September 2008. Coincidence? Perhaps- personally, I don't think so given their in-depth analysis.

So when the same think-tank comes up with what they foresee happening in 2009, one would be prudent to factor in to some degree what they are anticipating.

Some food for thought before you discount this particular thin

... got cut-off.

In any event, I am not saying that what this particular think-tank is saying will happen verbatim.

What I am saying is for you, the reader, to do your own due diligence, educate yourself and amass knowledge from as many credible sources that you have access to... and then, synthesize your own analysis based on your homework and prepare accordingly.

This think-tank is just one example I wanted readers here to follow-through with before people simply write my posting off as a 'chicken-little' and/or baseless 'gloom and doomer'.

We are getting really close to that capitulation point. Did GE bottom at $5.68 yesterday?

GE Capital is a black box. That may not be GE's bottom, though it hurts me to say that.

MMAfia: What's your defense? If even half of what GEAB is talking about happens, we are all in for a heap of trouble.

I think the hedge funds are still dumping for redemptions by quarter end...

citi at $1?

Escapin' through the lily fields
I came across an empty space
It trembled and exploded
Left a bus stop in its place
The bus came by and I got on
That's when it all began
There was cowboy Neal
At the wheel
Of a bus to never-ever land

capitulation trade coming monday?? after a day of mild selling tomorrow following the grim unemployment data?? we shall see!! fingers crossed, oh what a painful ride it is...

theburkhardtgroup, you what my answer is. start shifting allocation to gold from cash. as the situation deteriorates, adjust allocation by increasing exposure to the precious metal.

mfox - I think the hedge funds are still dumping for redemptions by quarter end...

not I think.. I know.

MMAfia: what are your thoughts on taking physical possession of some gold/silver coins?

As someone so aptly put it recently "now every Johnny Retail is in gold, which means it's time to sell". May have missed the opportunity at $1,000.

Recently sold all my gold ETF's and some mining stocks I bought a few years ago. In relation to the possibility of a collapse in "paper money" we are speaking of something of a different color.

"capitulation trade coming monday?? after a day of mild selling tomorrow following the grim unemployment data?? we shall see!! fingers crossed, oh what a painful ride it is..."

that doesn't sound like capitulation to me...

;-)

no i mean mild selling today (after unemployment news) and then monday the big drop lol

nyc10028.."no i mean mild selling today (after unemployment news) and then monday the big drop lol"

there is alot of pain out there you shouldn't be lol. Yes, let's capitulate and hit bottom, it's for our own good.

shouldnt be lol? huh?

I don't think steveF will be LOLing anytime soon. he's been calling the botton in stocks and real estate for over 10 months.

Stocks

10 months ago

"Back from the 1031 and this intermediary was pitching his "like kind' as commercial/office property in other parts of the country. Sorry I like the Big Apple. Anyhow, nice to see the Dow up 140 and heading for 13,000."

6 months ago-

"I don't know how you stock guys handle all the volatility but if your in this game I would buy some of those solid beaten down financials....all that artificial toxic mortgage money that initially inflated stock prices has now deflated stock prices and that same mortgage money is being written off"

"This is great!!!!!!!!!!.....Can the govt zap the credit crisis with one move?..looks like it can...."

Real Estate

6 months ago

"Bears, your hopes and dreams for prices to come down are fading fast, I don't know what you are looking at, but my studio condos comps prices have moved higher in the past year not lower and that's with the media induced terrified buyers sitting out-of-bounds"

10 months ago

"Inventory should be peaking right now. People put their listings up in Jan/Feb/March/April and now we will start seeing those properties CLOSE in the next couple of months. What does that mean? Inventory comes down. It's not rocket science."

"dco, remember this...the Fed has butchered interest rates and injected massive amounts of liquidity into the economic system. That means GDP growth and higher wages. Higher wages means higher asset prices.....hey have you notice no one is yelling RECESSION anymore"

"6 months ago- I (SteveF) don't know how you stock guys handle all the volatility but if your in this game I would buy some of those solid beaten down financials..."

CLASSIC. Hope nobody listened to SteveF and bought financials 6 months ago. Doh!! Very spunky-esque.

lol, the stock mkt keeps on crashing. that's good for those that are shorting and have puts (i keep up with the "looking at the glass half" full attitude that characterizes me).

guys, no one wants the market to crash, im not sure why so many people are so seemingly happy to see it all go to hell? are you guys happy to see others suffer? not everyone bought a place to "speculate." some people just worked hard and were happy buying a home they could afford, and then ended up getting screwed because they happened to buy at the "peak."

nyc10028... I save my tears for people who don't have food, clothing, shelter and no hope of ever achieving that (i.e. not in US).. and an extra tear if they are children,... and another if they don't have parents....

Seeing a bunch of people crying b/c their $2MM condo is now worth $1MM and the realization that they have to save for a rainy day (l saved all my nuts, even bought Sam's Club brand of "Tide" for 50% off)... well I sleep very well after logging on to SE and typing LMAO as many times as I can :)

"guys, no one wants the market to crash"

talk for yourself, those of us that think housing affordability is a plus for the country are happy to see lower prices. it's not a celebration of the pain that those that got caught up in the "buy now or be priced out forever" are feeling. don't confuse both.

w67, i second that.

mmm ok, NO one wants to see people suffering losses. i am not talking just for myself, i am speaking for others as well. all i am saying is this is PAINFUL and its a bit sad to see people constantly commenting and jeering on other peoples' bad decisions. im sure others here have not been perfect angels with finances all the time. give me a break. we are all in this together and we must come out of this together. no need to consistently bash people on this blog and wish them the worst.

its one thing to comment on the screwed up regulations we have - ie appraisals for example... they are JSUT as guilty as the rating agencies. i think the bashing should be directly to those people who get paid to do a job and simply are not doing it, instead of the people who bought into the market and happened to be sufferring now, dont you think?

nyc10028.. I rent... have for most of my life and but "definitely" was forced to the last 3 years bc I didn't want to be mortgaged to my house... I don't do well with things that I cannot pay off in 1 year, if need be... I've been taught to save and live 2 income brackets below my income level.. .got $1MM in cash, no other debt, even own a 1bdrm co-op outright in the mid 60's.... I was amazed to see 25yo buying a 997T and F430 etc.... I thought I must be doing something wrong... nope, apparently in America, a 730 credit score and 1% equity is all you need to do any transaction.... but no-one put a gun to anyone's head to buy a Ferrari or a $1MM condo... so I continue to LMAO... sorry, but again... my moral compass points true north all the time :)

no one does, of course not. but you ASSUME the market is giving you appropriate pricing. one would like to assume markets are efficient, thats all. and its extremely sad to see ppeople laughing at other's mistakes. i just dont see that as moral, sorry.

nyc10028, some of those people have been calling the renters idiots for the past few years. real estate tends to be emotional. schadenfreude isn't pretty, but it's hard to repress.

i agree, i have a lot of sympathy for those who did their best and bought thinking it would be tight but doable and they weren't going to get anything better so why the hell not and now it's not doable and what do they do? i have no sympathy for the young master of the universe who thought it would be cool to buy a condo with appliances he'd never even heard of to keep up with the other masters of the universe.

i think the culture needs to change - top down first. the younger people are just bred into this. i am not saying its only the people on the top's fault, but apples dont fall far from trees. the experienced people are responsible for setting the culture of these organizations (banks etc) and they have failed miserably. i blame the top, the senior people, the government, the regulators. its just really frustrating to see people place the blame game, and laugh at others. not everyone laughed at renters and it is extremely naive to simply laugh back because you were laughed at once. people should be confident enough to stand up for themselves without inflicting verbal wounds on others. doesnt this go back to grade school?

If you were an appraiser and you didn't give the appraisal desired, you wouldn't be getting much more business doing appraisals. Sad but true. Everyone was pressured. Some succumbed, whether out of greed, weakness or wrong assumptions. But nobody ever felt bad for the folks who missed their opportunity to buy, whether in stocks, commodities or real estate. Largely they didn't ask anyone to do so. But I don't think the majority of them are going to have much sympathy in general for those who did buy.

trifecta

opportunity cost is different from real/realized loss. there is an opportunity cost for everything - this is not necessarily quantifiable. bleeding cash is realized/real and much more painful.

"we are all in this together" why do i hear this only when i have to pay for others mistakes? should i begin to use this when paying my bills? "hey, nyc10028, we are all in this together! help me out!!!"

"but you ASSUME the market is giving you appropriate pricing. one would like to assume markets are efficient, thats all." nyc10028, i don't know where to start here, and i'm a phd in finance! LOL, simply put don't buy the theory. sheepy behavior in finance rarely goes unpunished. besides current models in finance are just a reflection of how limited is the math of people in academia in econ and finance fields.

you are a price taker, that's true. that doesn't mean you have to TAKE IT! the smart thing for the last years was to rent. saying that makes the buyers feel bad? who cares!? it's reality, deal with it.

ante..yes I would have dollar cost avged USB starting @ $20....and Wells and JPM If I was a stock investor those would be my holdings. But i like owning the best real estate with high end tenants, not stocks. You can sleep very well and make money basically sitting on the buttocks...

nyc10028, i'm one of the more sympathetic ones around, and i hear your grade school comment, but human nature is not so perfect, nor should we really wish it to be. after being scorned, or just having people tsk tsk at me when I said I don't think now's the time to by (oh, well, my husband is certain you're wrong, so we're going to go ahead. but, you know, we can afford it, so it's not that huge of a deal). now, would I be human if I didn't feel some sort of immediate self-congratulatory smirk form when I hear that said couple need to sell? no, of course not. do I want them to hurt, no, I'm not vengeful and I'm happy with my decisions.

there are a huge number of innocent people getting screwed on every level here. it's impossible to lump them all together. but there are cases where it is harder to be sympathetic.

malthus, on the appraiser issue, how is it that new developments are appraising out for contract prices? or are they not? i'm totally mystified, everyone can't be able to do all cash.

Ok. If we are talking about degrees of pain, I'm fairly certain that current renters feel much worse for underwater owners now than appreciating asset owners ever felt for renters 3 years back. Nobody wants anyone to suffer, but few things in life are really win-win, unfortunately.

aboutready - fair enough comments, appreciated.. but the general tone of bashing all buyers and wishing them the worst is frustrating, not the deal-specific comments.

human nature is not perfect, but one can certainly control their comments - be respectful and mindful of others and not bucket people into categories. this is not too difficult to do.

nyc10028 maybe ridiculing those that thought that it made sense to pay more than a million for a little closet might have it's benefits for the society as it could help to delay the next bubble to laugh about their amazing optimism.

like people today laughs about those that gave their farms for a couple of tulip bulbs back in netherlands. that laugh might prove to be useful as it reminds us how crazy people can get when it comes to try to get rich quickly and without effort. sure, it hurts the ego of the homeowners that got in the peak. but, it makes those that made the right choice feel good, reinforcing the importance of making a good decision. this is among the biggest real estate bubbles in history, it's gonna be a great story to tell the grandkids.

admin - of course it doesnt mean you have to take it! this is certainly true. but when you find somethign you can afford, based on salary and PV of future cash flows, you go through with the deal. if you would have been so certain that the "peak" was the time to rent, then you should ahve shorted the market and become crazy rich. did you do that? or are you monday morning quarterbacking?

"But i like owning the best real estate with high end tenants, not stocks. You can sleep very well and make money basically sitting on the buttocks..."

Hmmmm.... stocks don't ask for toilet repairs and complain about leaky roofs.... They just mail you checks.... a LOT less work that RE (outside of owning stock in RE companies).

Also, I don't know too many people who "sleep well" with RE investments these days. REITS are down significantly more than the market.

Third... LEVERAGE. Don't know how 5 to 1 or 10 to 1 makes anyone sleep any better....

admin, this is a story for the ages. my daughter had better procreate so I can bore the hell out of the young'uns with my rambling tales of assets soaring and assets blowing up. the circle of life.

aboutready: Wish I could help you there. Just making a point that everyone felt pressure in the bubble from rating agencies to mortgage bankers to securitization Ibankers. If you did not do it somebody else would and you could go home. I'm not absolving anyone, but its hard and unfair to pinpoint blame on a particular group in this clusterfrock.

admin - its you tone thats exactly what i am talking about. stating it matter-of-factly vs stating it almost with a smirk is very different. worst in histroy and telling grand kids sounds like you are telling some sort of story where you happened to not be affected and could sit on the sidelines and laugh - please dont do this. people are losing their homes, equity, everything. its inappropriate to show emotion that many on here are showing. perhaps not you, buit i am saying it is the general feeling i have about many comments here (as i mentioned previously).

malthus, i know bankers who have confessed that if you didn't have the right "attitude" you wouldn't have kept your job. no news flash there, but it does make one wonder what one would do under the same circumstances.

aboutready: Agreed. I would like to think I know what I would have done but I never had to face it. On the whole though I would have to say that it was a lot easier to resist making a bubble purchase and taking cheap money from banks than putting my job on the line for principles when everyone else was convinced real estate was one-directional (and some still are -- I'm looking at you SteveF).

aboutready - i can confirm your comment. i used to go on investmentbankng interviews where my interviewers would put their feet on teh table and make me feel 100% uncomfortable to try to break me. i thought it was OBVIOUSLY innappropriate but getting one of those jobs was the thing to do to make money and really "make it" in finance. the environment was full of people who were cocky, thought they were better than everyone else, etc. but it is the managers' responsibility to engrain the true culture of the organizations to the youngsters. this failed and the cycle went on. if you didnt "fit in" you wuold not last.

nyc10028, this is an anonymous real estate board. you want to see nasty and coldhearted, go check out the comments on curbed.com and then you'll come back with a great deal of appreciation for the discourse here.

"then you should ahve shorted the market and become crazy rich. did you do that?"

yes, by buying puts on homebuilders and mtg lenders (these lenders by now are most already gone). also got my in laws out of the mkt near the peak. didn't study finance to avoid applying it in the real life. so for me it's good if the stock mkt goes as low as possible. i know that by now you consider me a criminal given that many are long the mkt with their retirement savings, but i'm not. this crash is good for the young that just start out and where hurt by the bubble (like me, for example). i told to anybody that asked me "do not buy a home now", "get out of the stock mkt".... some laughed at me but a couple of friends and my in laws profit from it. so i'm happy that i was right, otherwise they would hate me by now!

"but when you find something you can afford, based on salary and PV of future cash flows, you go through with the deal." this is certainly not true. just think about buying a bike. would you put all your savings into one if asked to and go through with the deal? without considering how much the substitutes cost? i hope not.

but everyone only calls this a bubble now - if you all would have really known this was a bubble at the time, you would be zillionairres shorting this market! i ask again, did anybody here do this?

"crazy rich" not true, given that i started with so little. i made handsomely but i'm not "crazy rich" by any stretch. i'm more about preserving capital, so it was a huge stretch for me to buy those puts, my husband pushed me to do it.

admin - the substitutes were more expensive, of course its a comparative analysis

I'm not a zillionaire because I didn't have the means nor the ability (can only invest in mutual funds), but yes I called the bubble in 2004ish, and I sold at a profit but not at the top, and I've been waiting patiently since.

I've long contested that there was an artificial creation of "wealth" everywhere, but particularly in NYC because of the financial industry.

nyc10028, one of the real problems is that the talking heads convinced everyone to change the definition of what they could afford. They even had handy-dandy little calculators you could plug a few numbers into and the great underwriting gods would tell you what you could afford. Of course you couldn't, and of course many people weren't clever enough to realize it. I'm not laughing at them, but it was very poor financial planning.

"Let's bottom already....Surrender now."

Uhhh....SteveF, I think you want another kind of anonymous site for that kind of action. SE is for real estate, just so you know. Not that there's anything wrong with that.....

Hilarious.

"you would be zillionairres shorting this market!" -- that would assume you could time it. I hate to repost what dozens have posted here before, but the nature of a bubble is that nobody knows when it will end. I'll be the first to admit that I expected it to end earlier than it did. But realizing that I did not have a bead on when the pin was coming, I did not bet on it. Kudos to admin and John Paulson for timing it correctly. But if you read the details on Paulson he nearly went out of business betting against it before things finally turned his way. My guess is that he does not wish bad things for anyone, but I'll be he feels pretty good right now too. Especially after everyone told him he was crazy for so long.

malthus - ok fair enough.. i will give him his moment, but then lets chill :-)

Ok. I think Waverly zeroed in on what is behind this post anyway.

Hmmmm.... stocks don't ask for toilet repairs and complain about leaky roofs.... They just mail you checks.... a LOT less work that RE (outside of owning stock in RE companies).

Also, I don't know too many people who "sleep well" with RE investments these days. REITS are down significantly more than the market.

Third... LEVERAGE. Don't know how 5 to 1 or 10 to 1 makes anyone sleep any better....

nyc10022 you pay cc for that and you grease the super and he takes care of the little extras. Let's put it this way of my studios 2 of them I have owned for 4 yrs and I have never met the tenant and I was only there once each before I made the offer. talk about low maintenance. Also you can't price real estate evryday like stocks. When things are not ideal sellers just pull the listing and wait so it flattens.

"this is among the biggest real estate bubbles in history"

it IS the biggest real estate bubble in history. it was so unbelievably large that it's taking down the entire world with it thanks to global asset/mortgage backed securitization and derivative risk machinations.

people just don't get it. this is absolutely unprecedented. never in the history of mankind has something like this happened, where the entire world economies collapse with such severity all together at once.

Just ask Volker. And he's the guy that got us out of that dreadful stagflation mess in the 70s.

http://www.reuters.com/article/ousiv/idUSTRE51J5JM20090221

Martin Feldstein, who's now working with Tall Paul, has been busy sharing the same views. Fugly in extremis.

"nyc10022 you pay cc for that and you grease the super and he takes care of the little extras. Let's put it this way of my studios 2 of them I have owned for 4 yrs and I have never met the tenant and I was only there once each before I made the offer. talk about low maintenance."

Infinitely more maintenance than a stock. I'm amazed that you are still arguing this. And guess what happens when a tentant doesn't pay!

"Also you can't price real estate evryday like stocks."

So ignorance is bliss?

"When things are not ideal sellers just pull the listing and wait so it flattens."

Do you think foreclosures make you sleep well?

Guess what, TONS of people tried that... and now they're broke.

"it IS the biggest real estate bubble in history."

yes in terms of scope as the fuel (cheap debt) was readily available in every anglo-saxon country and then on some others too. but not in terms of valuations. the tulip mania was the farmer's continuation of a real estate bubble in posh parts of amsterdam, that was a big one. tokio's bubble that peaked on 1991 was also a very big one. at the peak the Imperial Palace was worth more than California.

given that the bubble peaked on 2006 i would have guessed (wrong according to the CEO of Toll Brothers) that the price of construction materials would have crashed too. for me it's important to get it right as i plan to build a house (eventually, not in ny state). how come is taking more than 2 years for them to go really low? anybody here has a guestimate of when will they bottom?

same thing with appliances. anybody has a guestimate of when the price of those (kitchen appliances) will touch rock bottom? or is it that there are still enough people around thinking about remodeling using an HELOC and "increasing the home value" meanwhile?

> tokio's bubble that peaked on 1991 was also a very big one. at the peak the Imperial Palace was
> worth more than California.

I remember the stat that land in downtown tokyo was worth more than the entire US stock market and then some....

admin, agreed.

tulips win in terms of %increase valuation, but keep in mind that it is not real estate.

tokyo's real estate bubble also outdoes the current bubble in terms of %increase in valuation. i'll never forget that day when i read how the imperial palace, a tiny speck within Tokyo City, was worth more than Cali.

but as you correctly point out, the overall aggregate size of what's going on today, taking into account all the real estate bubbles around the world on top of the US (London, Russia, Shanghai, Dubai, etc.), and just the massive scale and far-reaching tentacles puts the current situation in another league altogether, something we simply have not seen before.

and we haven't even hit the main crisis yet!

watch the currency markets carefully people. watch very carefully.

Any debt default by an eastern state would trigger massive losses to Western European banks that are heavily invested in the region....this will trigger a collapse of the world economy as we know it.........

Look what I found...

"Looks like we've got a house full of bears...well then it's time to buy. The fed has pumped 1 TRILLION dollars into the market already. What does that mean a year from now...inflation. Which in turn means assets become more valuable. It's not rocket science here, it's all been done before, this time is no different."

Oh yeah, this was... A YEAR AGO...

http://www.streeteasy.com/nyc/talk/discussion/3181-poll-whats-going-to-happen-to-re-market-in-ny

Only when Steve stops calling a bottom can there be an actual bottom.