Quote:
http://www.m-w.com/dictionary/complacency
Main Entry: com·pla·cen·cy
Pronunciation: -s&n(t)-sE
Function: noun
Inflected Form(s): plural -cies
1 : self-satisfaction especially when accompanied by unawareness of actual dangers or deficiencies
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Apparently, it is premature to discuss such things as the US economic downturn, already well, underway. In place of actual discussion, responses to the thread OP, and subsequent posted supporting information, is answered with:
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Originally Posted by jorgelito
The economy is going great right now!! 2006 and 2007 are slated to be the best in years in terms of jobs and job growth for new graduates. The Fortune 500 are fighting heavily over new grads right now. Employers are offering more incentives and bonuses than ever. The future looks bright.
Didn't the stock market grow like 2000 something points in the past 4-years before last weeks temporary lows?
The real estate market will always ebb and flow, just like anything else. Up and down, up and down. Now and then, now and then. If houses are too expensive or rates too high, then just rent and wait for it to come down. I have missed many "booms" (dot com, stock markets, real estate) but I never panic cause I know I will get my opportunity soon enough. Deferring gratification, patience, making wise decisions will pay off in the end (in my opinion). I never had a chance to capitalize on the low interest rates of the past few years, nor did I get in on the tech boom stocks. but hey, more opportunities will arise.
By the time I will be ready to buy a house, rates will either fall again, or due to the previous frenzy, there will be lots of awesome foreclosures to be had at fantastic prices.
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....and:
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Originally Posted by aceventura3
....I stand by my first post in this thread. The sub-prime definition was my way of illustrating how the term only has meaning in the "eye of the beholder". Given the worse case - what has happend in the subprime market? Some people who were renters became homeowners. Some people who were doing little or no investing bought some investment property. Given that - if they loose - their credit score goes down and the bank owns some real-estate that will be sold at below market prices. When that happens strong investors and strong buyers will benefit. Like the old saying - the rich will get richer.
So again, I ask for the economic guru who can explain what is going to happen to net demand for housing and how long-term, the market goes down. Everything else is just smoke and mirrors and a means to sell newspapers and TV ads.
P.S. Also - if you don't own stock in a subprime lender, didn't get a subprime loan and lost your ability to pay, don't own property in high risk areas what going to happen to you if the subprime market blows up - pretty much nothing. But you say there will be a chain reaction - but thats where you or the economic guru needs to make the link with long-term demand and supply and a short-term market correction. No one has done it yet, other than to say the sky is falling. Last time I checked Chicken Little is not a trained economist.
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The competition that is the presentation of ideas and opinion is what the "revolution" of the mass availability of the internet brings to places like this forum. We have the ability to make well documented presentations as we attempt to share/exchange information. This privilege did not exist, during the first 2/3 of my adult lifetime.
If we can't or won't exercise this resource, and set an example of doing so, in depth, in a place like this....a place where we come to discuss politics, where will it ever happen?
We can exchange "banter" in a supermarket check out line, sitting on a barstool, or with neighbors who stroll by, as we are watering our lawn.
If we don't post in favor of a higher level of presentation here, complete with linked text in support of our points, much of the potential of the internet is reduced to just "shooting the shit" with each other. We can do that over on the Gen. Diss. forum...or in the parking lot, and next to the office watercooler.
....and nobody is required to participate in any thread that I author, so I guess that I am unable to see why my thread OP's receive responses that are not competitive and "jack" the topic and the spirit of the intent of the OP ideas and supporting references.....
It makes me feel like Al Greenspan must have....after he spoke about the potential for economic recession in the US, and this "response" came:
Quote:
http://www.foxnews.com/story/0,2933,257002,00.html
FOXNEWS.COM HOME > FOX FAN CENTRAL > COLUMNS
"Two Words Mr. Greenspan: Shut Up"
By Terry Keenan
Alan Greenspan, former Federal Reserve Chairman.
There he goes again. Just in time for his 81st birthday, former Fed Chief Alan Greenspan is showing once again who's still the boss when it comes to commanding the attention of markets, here and around the globe. And this time, he's putting odds on his predictions.....
........Which raises the question on the minds of many investors: is it unseemly for 81-year-old Greenspan to earn millions with statements that last cost investors about a trillion dollars in lost market value? Even though he is out of office, is Greenspan somehow violating the public trust, much in the way a former CIA chief might if his paid remarks warned of an impending threat from a sworn U.S. enemy?
Tough questions, but there's no doubt that there has been a bull market in outrage over Greenspan's comments. As Gary Kaltbaum of Kaltbaum Associates put it: "Two words, Mr. Greenspan: shut up."
Adding to the considerable consternation is that this isn't the first time private citizen Greenspan has been criticized, both for his remarks and for the venue in which he chose to express them. Remember the private meeting with fewer than a dozen top clients of Lehman Brothers a year ago? As word leaked out, those remarks jolted markets as well.
When Greenspan was Fed Chief, he knew all too well that even a few words taken out of context could rock world markets — think back to "irrational exuberance?" Now, with no cameras trained on his every word, Greenspan's words need to be chosen with even greater care. Not only would a little more discretion on Al's part please the markets, it would make Ben Bernanke's job a whole lot easier as well.
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Is the equity market so fragile that a tepid description of forward risks by Mr. Greenspan, justifies such harsh criticism of him personally and a "STFU" title?
Would that Terry Keenan, and ace and jorgelito, exhibibit some curiousity and concern as to how Richard Syron, got the job of heading Freddie Mac, and then....only after his GSE's ridiculously lax lending policy provided the liquidity that drove housing prices to unsustainable and unreasonable valuations in the first place, sees a need to "toughen" lending rules, now that lending to unqualified and poorly documented mortgage applicants cannot be further justified on the grounds that even the massive liquidity flowing from his agency is not enough to assure that it is fine to lend to people who have poor credit and "no money down" because doing so would continue to push up the valuations of all homes.
I'm also wondering why Freddie Mac would ever purchase the mortgage loans of home buyers who were unqualified and had little or no downpayment at the time they applied, and I'm more concerned as to why Richard Syron still has his job, than I can be about any comments made by Greenspan about economic risks.
Quote:
http://www.cnbc.com/id/17359800/site...lnk&cd=3&gl=us
Freddie Mac Toughens Standards For Buying Subprime Mortgages
Companies:Freddie Mac
By CNBC.com | 27 Feb 2007 | 01:04 PM
.....In an exclusive appearance on CNBC, Richard Syron, Chairman and CEO of Freddie Mac, said he was taking the action now because borrowers have been squeezed by higher interest rates and falling housing prices.
"At a time when housing prices were going up 5% a year, and it went up 10% in two years, if someone paid 5% to get a mortgage, they were still ahead," said Syron. "But in the last few months, housing prices have softened."
Iin addition, Freddie Mac will limit the use of low-documentation loans where borrowers cannot verify their income.
The new standards won't take effect until Sept. 1, 2007 because Freddie Mac wanted a transition period.
"We don't want people that have things in the pipeline now or may be in a position that they have to refinance in the very short run to be squeezed out of the market," said Syron.
Freddie Mac has financed about 50 million homes. Syron says the company is developing new, more consumer-friendly subprime products.
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I guess that our respective concerns are driven by our individual priorities....