ragerunner

But, but, but... up until today everyone from Wall Street on down was telling people that sales were strong and would be positive for the holidays. Another prediction bits the dust. Retail sales drop 0.3% on widespread declines For 2009, sales sank a record 6.2% to $4.14 trillion "WASHINGTON (MarketWatch) - U.S. retail sales fell a seasonally adjusted 0.3% in December on widespread weakness across different kinds of stores, the Commerce Department estimated Thursday. The decline was unexpected, as economists surveyed by MarketWatch were forecasting a 0.5% gain." http://www.marketwatch.com/story/retail-sales-drop-03-on-widespread-declines-2010-01-14 Jobless claims jump in latest week; trend positive "WASHINGTON (MarketWatch) -- First-time jobless claims rose last week by the largest amount in five weeks, surprising economists who had expected a decline." http://www.marketwatch.com/story/jobless-claims-up-in-latest-week-trend-positive-2010-01-14 Man, the economist are on one impressive streak.

It should be interesting to see if their crystal ball is working well. For this kind of improvement in home prices you are going to need a significant demand increase, employment growth, and a lot more government stimulus money.

Wait. It's only a loss if it's sold at the lower price. Who in their right mind would sale now is beyond me. All those that are unemployed and can't find employment to cover their cost, those that need to move due to jobs, all those that can't afford what they bought and those that are having their rates reset. That covers a lot of homes and condos and will cover even more over the next few years.

Add in their crime problems and its one 'happening' city.

A quick look at the average price of homes in Ohio from the peak to today. 2005 2006 2007 2008 2009 Cincy $183,277 $173,331 $174,106 $163,874 $150,563 Columbus $172,834 $167,371 $173,441 $165,377 $157,352 Cleveland Area $171,229 $164,761 $164,761 $141,523 $118,903 Dayton $132,524 $129,322 $134,419 $126,139 $122,123 Average Price lose per area: Cincy ($32,714), Columbus ($15,482), Cleveland Area ($52,326), Dayton ($10,401) http://www.ohiorealtors.org/news/stats/index.aspx I think these numbers will continue to drop year over year in 2010 as the foreclosures continue and the ARM and I/O resets begin in force. I do think we may start seeing more loses and foreclosures in suburbia (as well as the urban condo market) and less in the urban city area since most ARMs and I/O where used for higher income individuals and more expense homes/condos.

Are we taping future buyers today, leaving tomorrow with a smaller and smaller buying pool? Sales were up year over year because of the taxpayer handout. Without the taxpayer hand out sales would be below 2008. Pending home sales index plunges 16% Expiration of federal subsidy drives sales lower, NAR says "The fact that pending home sales are comfortably above year-ago levels shows the market has gained sufficient momentum on its own," said Lawrence Yun, chief economist for the lobbying group. "We expect another surge in the spring." http://www.marketwatch.com/story/pending-home-sales-index-plunges-16-2010-01-05 The NAR has and is full of it. What sad leadership this organization provides. The market has gained NO momentum on its own. The taxpayer ($50 billion and growing) has had to provide the momentum. Take what this group and its leaders have to say with a grain of salt. Below is a nice sample of how 'WRONG' they have been. I will give this organization one thing, they are consistent with being wrong. Great NAR Quotes (in chronological order): 08/2005: "All of the doom and gloom forecasts of a housing debacle are not only irresponsible, but also downright wrong." David Lereah, National Association of Realtors 04/2006: “We can expect a historically strong housing market moving forward, earmarked by generally balanced conditions across the country and fairly stable levels of home sales with some month-to-month fluctuations.", NAR 07/2006: "Right now we are on course for a soft-landing in housing.", NAR 10/2006: "The worst is behind us, as far as a market correction. This is likely the trough for sales. When consumers recognize that home sales are stabilizing, we'll see the buyers who've been on the sidelines get back into the market.", NAR. 12/2006: "At least the bottom appears to have already occurred. It looks like figures will be improving.", NAR. 01/2007: "It appears we have established a bottom" David Lereah, NAR Chief Economist. 07/2007: "Home sales will probably fluctuate in a narrow range in the short run, but gradually trend upward with improving activity by the end of the year.", NAR 11/2007: "I don't anticipate any further major sales declines," Yun said. However, the NAR didn't anticipate the sales declines of the past two years, and it's been predicting a bottom nearly every month since early 2006. (from Marketwatch) 02/2008: Reuters reports that "The NAR's chief economist, Lawrence Yun, said the market is 'scratching the bottom,' with sales holding at a deflated rate of around 5 million units for the past several months." 07/2008: “There are signs of pent up demand …. I think we are very near to the end of the housing downturn,” Yun said. 04/2009: "We are close to the bottom, says Lawrence Yun, chief economist for the National Association of Realtors. Once home sales begin to rise that could boost home buying confidence and get others off the sidelines." 04/2009: The "worst may be over" in parts of the West, said Lawrence Yun, NAR Chief Economist. Will their latest quote(s) be added to this list in the future? I think we have a good chance. The truth to all of this is the real estate market needs to fully correct itself. Prices must come in line with incomes and excess inventory must be consumed or removed from the market. This is and will continue to be very painful for the economy and will take years to work through (since we are taking the Japanese approach to this problem - i.e. lost decades).

Speaking of Frannie and Freddie. The system is broke, in more ways than one. The Biggest Losers Behind the Christmas Eve taxpayer massacre at Fannie and Freddie. "Even better for the political class, much of this is being done off the government books. The White House budget office still doesn't fully account for Fannie and Freddie's spending as federal outlays, though Washington controls the companies. Nor does it include as part of the national debt the $5 trillion in mortgages—half the market—that the companies either own or guarantee. The companies have become Washington's ultimate off-balance-sheet vehicles, the political equivalent of Citigroup's SIVs, that are being used to subsidize and nationalize mortgage finance." http://online.wsj.com/article/SB10001424052748704152804574628350980043082.html?mod=WSJ_hpp_sections_opinion

Fed economist calls for US government MBS guarantees "* Fed economist wants asset-backed securities guaranteed * Would avert Fannie Mae, Freddie Mac collapse, he argues * Suggests guarantees similar to FDIC's structure * Comments come as fate of Fannie Mae/Freddie Mac debated" "ATLANTA, Jan 3 (Reuters) - A U.S. Federal Reserve economist called on Sunday for the creation of a new federal institution to backstop losses on asset-backed securities to prevent any future collapse of mortgage finance giants Fannie Mae (FNM.N) and Freddie Mac (FRE.N)." http://www.reuters.com/article/idUSN0320287220100103?type=marketsNews The concept of risk is simply being removed from the system as the taxpayer is being asked to be the one to bailout all things. Including bad home investments.

I won't be picking that up since I'm screening for just the private sector employment. Which might be picking up on jobs generated by the stimulus. ...I'd like to know the source for those durable goods numbers as that is a good indicator. I got that data from another blog site. But, here is some info from the New York Fed. http://www.newyorkfed.org/education/bythe.html#durgoods

Part of the attempt to turn the economic stituation around is to convince Main Street things are really improving (consumer sentiment is very important in a consumer driven economy). This thread is full of these PR attempts. They started by selling hard the concept that subprime was contained, and used the media system on a daily basis to try and convince someone it would be fine (of course it turned out to be anything but contained). Then we moved to CDOs are no problem, housing prices will not drop, and even telling Main Street the banking industry had no problems, etc. (We now see how those things are working out.) Now we are being feed on a daily bases that ARMs, I/O and commercial defaults will be contained. Is their a conspiracy, not in my opinion, is there a strong PR movement to paint a rosier picture than what exists, YES!! I also think part of the problem is the media has become lazy. They cut and past the press releases from RE industry, banking industry, the FEDs and do very little questioning. It would be nice to see a reporter on a major network asked Tim or Ben, how are the ARMs, I/O resets and commercial defaults going to be contained?

Speaking of date. Here is some date that I came across in another forum. It makes you realized the underlining economics are not improving like the media and FEDs would like people to think. Petroleum Distillates Distribution Historic Annual Levels Off Peak - anything below 0.8% growth is recessionary to previous periods historically: 1993 ….. 3.0% 1994 ….. 1.9% 1995 ….. 0.4% 1996 ….. 2.2% 1997 ….. 2.7% 1998 ….. 1.0% 1999 ….. 2.4% 2000 ….. 2.2% 2001 ….. -0.1% Last acknowledged recession 2002 ….. -0.1% Ibid 2003 ….. 2.0% 2004 ….. 1.9% 2005 ….. 1.6% 2006 ….. 0.6% 2007 ….. 0.5% 2008 ….. -4.2% 2009 YTD ….. -10.4% Durable Goods Shipments and New Orders YTD Comparisons Year Category ….. Y/Y % Change 1993 Shipped ….. 0.0% 1994 Shipped ….. 9.9% 1995 Shipped ….. 8.1% 1996 Shipped ….. 4.0% 1997 Shipped ….. 8.4% 1998 Shipped ….. 4.0% 1999 Shipped ….. 4.4% 2000 Shipped ….. 2.4% 2001 Shipped ….. -8.2% Last acknowledged recession 2002 Shipped ….. -2.3% Ibid 2003 Shipped ….. 0.3% 2004 Shipped ….. 5.5% 2005 Shipped ….. 6.9% 2006 Shipped ….. 6.2% 2007 Shipped ….. 0.3% 2008 Shipped ….. -2.1% 2009 Shipped ….. -17.0% 1993 New ….. 0.0% 1994 New ….. 11.7% 1995 New ….. 7.3% 1996 New ….. 5.7% 1997 New ….. 7.3% 1998 New ….. 2.2% 1999 New ….. 4.9% 2000 New ….. 4.1% 2001 New ….. -10.7% Last acknowledged recession 2002 New ….. -3.2% Ibid 2003 New ….. 3.3% 2004 New ….. 5.7% 2005 New ….. 9.3% 2006 New ….. 6.9% 2007 New ….. 1.1% 2008 New ….. -4.3% 2009 New ….. -21.7% Federal Budget Performance YTD Year ….. Rcpts (Millions) Outlays (Millions) Deficit (Millions) Deficit % 1999 YTD ….. 233,952 ….. 283,531 ….. 49,579 ….. 17.5% 2000 YTD ….. 242,410 ….. 296,712 ….. 54,302 ….. 18.3% 2001 YTD ….. 260,777 ….. 295,787 ….. 35,011 ….. 11.8% 2002 YTD ….. 278,396 ….. 342,048 ….. 63,652 ….. 18.6% 2003 YTD ….. 244,971 ….. 358,062 ….. 113,091 ….. 31.6% 2004 YTD ….. 254,047 ….. 366,564 ….. 112,517 ….. 30.7% 2005 YTD ….. 271,447 ….. 386,621 ….. 115,174 ….. 29.8% 2006 YTD ….. 288,328 ….. 418,617 ….. 130,290 ….. 31.1% 2007 YTD ….. 313,559 ….. 435,921 ….. 122,363 ….. 28.1% 2008 YTD ….. 329,230 ….. 483,025 ….. 153,795 ….. 31.8% 2009 YTD ….. 309,630 ….. 711,203 ….. 401,574 ….. 56.5% TARP $ 2010 YTD ….. 268,916 ….. 565,569 ….. 296,653 ….. 52.5% No TARP $ Unemployment Filings YTD 2009 ……. 2008 ……. 2007 ……. 2006 ……. 2005 28,771,747 .. 20,905,776 .. 16,393,559 .. 15,740,398 .. 16,752,987 Federal Food Stamp Data (SNAP) Month .. People .. Households .. $/Total Month .. $/Person .. $/Household Sep-07 .. 26,929,496 .. 12,029,068 .. 2,578,932,497 .. 95.77 .. 214.39 Sep-08 .. 31,586,923 .. 14,087,387 .. 3,365,488,472 .. 106.55 .. 238.90 Sep-09 .. 37,175,938 .. 16,890,668 .. 4,937,365,687 .. 132.81 .. 292.31 http://www.marketwatch.com/story/us-stocks-open-lower-as-investors-avoid-risk-2009-12-30

I thought the little gun guy would make you realize I thought the exchange was no big deal? That aside, Merry Christmas Cincinnatus and I hope you have a great new year.

I have some pics, but the links Living in Gin posted are much better and more comprehensive. Currently Denver has about 39 miles of light rail. With another 12 miles under construction with the west line.

It is in the millions upon millions of Americans that are unemployed. Ohio jobless rate rises in November http://www.bizjournals.com/cincinnati/stories/2009/12/14/daily53.html It is in the trillions that have been needed to keep our financial system from a depression. It is in the construction industry that has only begun to see huge defaults in the commercial sector. It is in the housing sector that needs taxpayer money to keep sales from drop even more. It is in biggest foreclosure crisis since the great depression. It is in state and local government budgets that in many places are nearing default levels. Including Ohio. It is in the growing concern that major nations in Europe and Asia may default on their national debt. I know to some these are small, minor issues. But for those that are trying to insure shelter for themselves or their family (tent cities are become quiet popular around the country), are on food stamps and living on unemployment checks, its seems a little larger. Unfortunately, those having these issue continue to grow and are at levels not seen since the great depression. Other than that you are right, what recession? You two might be arguing apples and oranges. Perhaps Cincinnatus' question was operating under a traditional definition of a recession as a "business cycle retraction" Things are bad, no doubt. But if they are better then they were 6 months ago, we are not currently "in" a recession. The "end" of a recession is not when things get back to the way they were. The "end" is when the economic "slowdown" ends and we either reach the point of stagnation or growth. That said, I have no opinion on whether we are currently in a recession. I leave that analysis to more boring people. Actually this exchange is more about a little 3 year pissing match on this subject. He shows up in this thread every once in a while, makes a little comment, then I or someone else response and life goes on. :shoot: The official determination if a recession is over will come from National Bureau of Economic Research(NBER). They have said they will not make any determination until probably mid 2010. They are concerned that we may only be seeing a short one or two quarter GDP bump from artifical government stimulus and not real long term economic growth. If you look at previous recessions many of them have positive GDP data for certain quarters, but the entire event was still determined to be a recession. I hope we are getting better, I am just not convinced it from the real economy. I think its mostly on the back of taxpayer money (stimulus) and not from the 'real' economy. I am believing more and more we have decide to take the Japanese way out. Slowly bleed the system for a decade or more to avoid the more severe, short term pain. I guess if the second biggest economy in the world can be in its second lost decade, then why not us?

Full Housing Crisis Effect Yet To Be Felt: Economist "I think we haven't seen the full effect of (the housing crisis) yet, because the servicers are not foreclosing that fast on homeowners… they realized they can leave these people in houses for a while, not paying," Geanakoplos told "Squawk Box." "The servicers don't own the mortgages, they have no interest in cutting down the principals," he explained." http://www.cnbc.com/id/34571747 Add this to the shadow inventory of homes the banks do own but are not putting on the market and the massive resets that will start in 2010 for ARMs and I/O loaned homes and you have a lot more pain/loses still to come.

I think your posts have made it clear you don't like Denver and you are glad you know longer live here. Denver's urban neighborhoods are anything but 'plastic feeling'. But, to each their own.

Hope you get a chance to visit. I think Denver and Minneapolis do have a lot in common (outside of the mountains). But, I think Denver has more active urban neighborhoods, more TOD development and a much larger mass transit system. I think the cultural scene and their downtown's are very equal. (Just an observation, not trying to start a who is better discussion). I like both.

While John is right that FasTracks (like most transit systems in the US) is over budget and/or underfunded (and may not be able to build its entire envisioned system by its current deadline) its still one of the best systems in the US. They currently have 5 light rail lines up and running, 1 more light rail line under construction (west), and have started phase one on the BRT line to Boulder. They also have started utility work on the new Union Station transit hub with full construction starting early in 2010. Here is the latest powerpoint showing the design of the complex. It will include facilities for light rail, commuter rail, Amtrak (California Zephyr), Ski Train, buses and the 16th street mall clean air shuttles. http://denverunionstation.com/pdfs/dec17_present/mtng_121709_fullpresent.pdf Also, not Denver rail related but, Colorado transit related. Fort Collins has begun work on their new BRT line in the core of the city (5 miles). There is a video on the opening page showing the system. http://www.fcgov.com/mason/

It is in the millions upon millions of Americans that are unemployed. Ohio jobless rate rises in November http://www.bizjournals.com/cincinnati/stories/2009/12/14/daily53.html It is in the trillions that have been needed to keep our financial system from a depression. It is in the construction industry that has only begun to see huge defaults in the commercial sector. It is in the housing sector that needs taxpayer money to keep sales from drop even more. It is in biggest foreclosure crisis since the great depression. It is in state and local government budgets that in many places are nearing default levels. Including Ohio. It is in the growing concern that major nations in Europe and Asia may default on their national debt. I know to some these are small, minor issues. But for those that are trying to insure shelter for themselves or their family (tent cities are become quiet popular around the country), are on food stamps and living on unemployment checks, its seems a little larger. Unfortunately, those having these issue continue to grow and are at levels not seen since the great depression. Other than that you are right, what recession?

Harvard Swaps Are So Toxic Even Summers Won’t Explain (Update3) "Dec. 18 (Bloomberg) -- Anne Phillips Ogilby, a bond attorney at one of Boston’s oldest law firms, on Oct. 31 last year relayed an urgent message from Harvard University, her client and alma mater, to the head of a Massachusetts state agency that sells bonds. The oldest and richest academic institution in America needed help getting a loan right away." http://www.bloomberg.com/apps/news?pid=20601087&sid=axcFIC0N68k0 A lot of retirement funds, investment funds, university etc... got/are caught in this ponzi scheme create by Wall Street and the big boys.

Cedar Fair to be acquired by New York private-equity firm "Sandusky-based amusement park operator Cedar Fair Entertainment Co. has an agreement to be bought by a large New York private-equity firm, the company announced." http://www.cleveland.com/business/index.ssf/2009/12/cedar_fair_expected_to_be_boug.html To much debt. They needed all the stars to align perfectly to make the huge Paramount parks deal to work financially. The economic turmoil made sure the stars never got close.

Home buyers need good credit score even with 20% down payment "But in this new era of tight credit, having a big down payment no longer guarantees you’ll qualify for a mortgage. Starting this week, mortgage finance giant Fannie Mae will require borrowers with a 20% down payment to have a credit score of at least 620. Previously, the cutoff was 580." http://www.usatoday.com/money/perfi/columnist/block/2009-12-15-ym15_ST_N.htm If they stick to this, this will drive another knife into the housing system. I think this is what we need to someday get back to a solid housing market, but the pain will be even more severe until we reach that point. U.S. gave up billions in tax money in deal for Citigroup's bailout repayment "The federal government quietly agreed to forgo billions of dollars in potential tax payments from Citigroup as part of the deal announced this week to wean the company from the massive taxpayer bailout that helped it survive the financial crisis." http://www.washingtonpost.com/wp-dyn/content/article/2009/12/15/AR2009121504534.html?hpid=topnews The backdoor fun just keeps on going and going and going and so does the corruption.

The bigger issues is that we are adding homes, to an already bloated number product market. There are people that cant even get mortgages and the government is subsidizing this?! WTH!! People are not spending. Prices of still falling. Unemployment is still high. Individual credit is shot! Sing it to the choir.

Home construction rebounds from 6-month low "Construction of new homes rose to an annual rate of 574,000 during the month, 8.9% above the revised October rate of 527,000. The rate was still 12.4% below the 655,000 rate during November 2008." http://money.cnn.com/2009/12/16/real_estate/housing_starts_November/index.htm Lets be honest here. Any data that is below 2008 is not good. Since 2008 data was in the middle of the deepest recession in American history. Year over year the industry is still in free fall. But, I give the media and the industry an A for spin.

Lenders put bad loans in subsidiaries "Some call the technique 'extend and pretend,' others 'delay and pray.' But by any name, the FDIC calls it fine." http://www.heraldtribune.com/article/20091214/ARTICLE/912141013/2413/BUSINESS?Title=Lenders-put-bad-loans-in-subsidiaries It creates a picture of fairies flying wildly around sprinkling pixie dust as fast as they can and chanting please make it so, please make it so.