The Housing Bubble

Not to mention that oversize inventories must start to decline before any pricing floor is reached.

Supply/demand anyone?

are you sure it’s not pramerica?

google “Primerica Scam” and see what comes up - it’s a doozy. have had a couple of friends start to get caught up until I point them in this direction.

I believe they bought the A.L. Williams life insurance company in the 80’s or early 90’s (or maybe they simply were A.L. Williams and changed their name to Primerica) …. they were a “term” life insurance company that was accused of shady sales practices (by the folks who sold whole-life insurance). Of course, they may be involved in a lot more — but that’s one thing they were into.

Zero is correct. They bought A.L. Williams, and it was an A.L. rep that approached me. About a year later, another “rep” approached me with the EXACT same pitch, word for word. Their thing was “buy term and invest the difference.” What they conveniently left out was “invest in A.L. mutual funds with 5 or 6 percent loads.” When Primerica bought them, I just figured it was one scammer getting in bed with another.

Look in the Florida post - I gave you some information there.

Thanks for all the information everyone.

“are you sure it’s not pramerica?”

or Kramerica.

I spoke to a realtor on Friday about how long it would take a transaction to go through and she said that cash should be two weeks but that all the ducks needed to be lined up if there was a mortgage involved. Not sure what that meant in terms of weeks but I got the feeling that it was between one and two months.

It’s been a quiet but wild day in the markets. Fed did a nice pump this morning and there’s an inverted head and shoulders on the QQQQs right now. I wonder which way she breaks.

Got cash?

“Got Cash?”

The problem with cash is that Bernanke is becoming a Jedi Master at stealthy ways of creating money. It’s starting to look like his game is to lend banks money, and later forgive that debt.

Recessions (and deflations) are big pluses for cash, only if the Fed does nothing and allows the recession to happen. The question is — is Bernanke capable of sitting on his hands? The evidence so far, says no.

In which case, “Cash” is not king.

“The problem with cash is that Bernanke is becoming a Jedi Master at stealthy ways of creating money. It’s starting to look like his game is to lend banks money, and later forgive that debt.”

He didn’t create any money. He just loaned money to give the banks time to sell assets to raise cash. What makes you think the Federal Reserve will forgive that debt? No way they will do that. They are not loaning any money on non-performing mortgages, only top rated debt.

Books…and more books. Loathe tv. I admit it - I’m a 20-oz latte addict. We fairly frequently treat ourselves to terrific restaurants….

We live significantly under our means. You’d laugh if you saw the 23 year old furniture we have.

I use my credit card for all purchases, even when I buy a $2 hamburger. I am taking my family on a free vacation to Disneyworld this winter. Thanks, Citi! Betcha hate me because I don’t carry a balance. HAHA!

I got so sick of people looking down their noses at me and my 5+ y-o vehicles… “I’ll always get a new car every 2 years”…

Great, that means I can get a 2-year-old car for half the price of new, then drive it for 10 years… Thank you ms./mr. Have-to-have-a-new-car! You cut my transportation costs substantially.

I’m pretty much in line with y’all on the fiscal prudence issue but I have to ask, does anyone here splurge on ANYTHING? What is/are your weaknesses?

Lou, they make fees on the transactions. They do NOT hate you. They don’t love you, but they really don’t hate you.

The credit card people (and just about everyone else) hates the people that still write checks…

“What is/are your weaknesses?”

Food & liquor.

Truly, my weaknesses are books for my kids. I have trouble going into the school book fair and walking out with less than $100 bucks worth.

My personal weaknesses include skiing and other outdoor activities.

I just splurged on a new guitar, but it was at 60% of the normal street price. I had the full price saved up for a while and was just waiting for a deal. Got the deal, got the guitar.

And a finely poured pint of a good IPA always opens my wallet.

“What is/are your weaknesses?”

I spend $20 a month on Blue Bell ice cream.

Condos, Hummers, and vactations are my only weaknesses. Other than those I could live easily within my means.

I’d snatch up an american strat or PRS at the right price.

Art, specifically, glass art.

I splurge on travel. I prefer luxury travel. It is important to have some indulgences. I have other luxuries that I consider important to recharge my batteries. My income varies greatly between $120,000 and $240,000 per year so I make a point to maximize my 401k contributions and IRA contributions first (pure stock mutual funds), participate at my comfort level in my employee stock purchase plan, buy a set amount of government securities per month (and some precious metals), and then spend extra money on my splurges. In the lean years I don’t do splurges.

I splurge on sporting equipment - a new fangled carbon fiber bicycle this year, news ski’s, seasons ski pass.

“What is/are your weaknesses?”

“I can resist everything but temptation”–Oscar Wilde

books, boat gas and red wine.

Ice cream. Dairy Queen, Marble Slab, Baskin Robbins, home made, store bought, it doesn’t matter. It just needs to be ice cream.
Roidy

Bill, I think I speak for many people here when I say . . . put a cork in it, son. We are tired of hearing about how you fund your various retirement schemes. I suspect you will die with every penny of your money unspent but you’ll have a hell of a good time admiring all your various account statements before that happens.

Loosen up!

Used books, Used DVDs and survival gear. When I splurge, it’s a new rifle or a bucket of ammo. The ammo gets reloaded. The rifles hold their value shockingly well.

Oh, yeah. Forgot one thing - Sweetwater Tavern. Brewhouse with three locations in Northern Virginia, makes its own excellent beer, sells it to go in half-gallon growlers which can be refilled for $6.00 or $7.00, depending on the brew. Awesome. When was the last time you got a half-gallon of great beer for $7.00?

haha roidy, yeah buying ice cream for my girlfriend is definitely one thing I won’t skimp on. Haagen-Dazs mint chocolate chip or black raspberry chip. If food were words, it would mean ‘love’.

And steak. Mmmm, steak.

As far as big stuff like plasma TVs or video game consoles that I am tempted to buy… I shop around the internet, compare models and prices, and then realize that everything will be better and cheaper in 6mos so I put it off til later.

The key to saving money is procrastination.

your weaknesses?” Coors Lite for me…..

Splurges? Biggest recent splurge was getting some original costume sketches I bought in Canada framed - properly framed. Cost a bundle. And I go on vacation at least once a year, most often a week at the Stratford Festival in Ontario. My family never went away on vacation when I was a kid.

Car is a 1997 Ford Taurus that just hit 100K miles and I bought for the estimated wholesale (auction) value because it was a sales support fleet car from my former employers. As long as the AC still works and it starts reliably, I don’t see any reason to switch.

I’ve stopped buying books. No more room for shelves in this apartment.

Strangely, knowing that we can afford pretty much anything we want (well, except for a house at the moment…) makes it a lot easier to ‘just say no’ to excesses.

That said, the husband and I are what the advertising industry calls ‘other-directed’, in that neither of us has ever thought that Things Maketh The Man. We do a budget every year and include luxuries, so no suprise we live within our means.

We splurge on music (download and vinyl) for the husband and I buy a lot of art supplies for my craft business, but we still manage to have a couple of hundred a month left over.

Actually, we do like to travel, and will do so at the drop of a hat - we both have family left in the UK, so an annual trip back to Blighty takes out a lump of change.

@txchick…..glass art, eh? I’m learning Lampwork at the moment, and I’ll let you know if I make anything worth looking at (not much that makes it though the kiln process at the moment, but practise makes perfect…).

Hey Tx. You’re retired aren’t you? You seem to spend time being bothered by my posts. Just ignore me.

Good wine and good beer.

Coors lite scdave? You’re joking right? That’s not even splurging when you’re in college! Give me Guinness or the like any day - don’t really like IPA either.

Good workshop tools are a weakness for me too. I figure at least with that I can recoup some investment over the long run though.

Used books, cherry cordial ice cream, and cheap beer.

Red wine and fine dining.

I splurge on private school for my teen, Cote du Rhone, and the ability to enjoy life debt free.

I have to ask, does anyone here splurge on ANYTHING? What is/are your weaknesses?

Disney vacations. While my wife is middle of the road about them, my kids and I thoroughly enjoy them. We usually do Anaheim vs. Orlando because it is substantially less expensive.

Splurge: Weekends in nice hotels with nice food; hordes of magazine subs from US and various other countries; buying (actually buying, not downloading) every CD made by name-yer-local-unknown-musicians. Other than that, I am perhaps sadly much like Bill in Phoenix, who txchick57 admonishes:

you’ll have a hell of a good time admiring all your various account statements

Hmmm.. I guess I too am a sad git who would just as well admire a nice stock certificate as any valuable modern artwork I could put on the wall. But no, the stocks and various accounts are for a purpose: For when I need a new car and can pay cash, for when I spot a horrendously good deal on some real estate (unlikely recently), and to squander in retirement on easy living.

I’ll try not to be too much of a salesman, but check out our Disney packages next time you are going. I have waaaay better deals than you can get at the front gate, and you can buy your tickets WILLCALL, so you don’t have to stand in line. Just head right to customer service, and your tickets are waiting. Here is the link:

http://reservations.californiasunhotels.com/681_attraction-tickets_a18.html?ticketID=1304

BTW, I wrote a good portion of the e-commerce engine on our site, so I appreciate any constructive criticism.

Good dark chocolate. Single origin is even better.
Books
Accessories for my DSLR camera

My weakness is airplanes. I love to fly them and fly in them. Vacations are a second vice but time off from work is getting scarce. I’m just trying to live cheap and enjoy life.

Arable ranch land with good water sources, and horse-trekking through foreign countrysides and vineyards.

This is a great thread: what do non-home-bubblers spend their money on?

I think that we spend $1,000 on books per year. The Barnes and Nobles membership certainly helps out there. We do use the local library quite a bit too.

Last luxury purchase was a MacBook Pro laptop ($1,800). Our living room and bedroom furniture is almost as old as txchick57’s. Our dining room furniture is back to my single days - mid-80s I think. My desk is early 1980s. Nothing wrong with old furniture. My mother’s furniture is probably from the 1960s.

Weaknesses? I recently spent $500 for a bike to become less fat and a lot of money (for me) on Etymotic ear canal headphones (makes traveling bearable — almost enjoyable), but that purchase was two years ago. Damn, I’m a miser! But I buy whatever groceries I want. Recipe calls for maca-madamia nut oil and lobster, I buys ‘em.

Books — library
No TV
Music — pandora.com and the CDs I ripped lossless and sold, iPod was a gift
Movies — Netflix, never the theater
Good, but mid-priced bourbon.
Free wine from “my source” at an upscale winery

I may not work for pay this year to work on my eco non-profit, so parsimoniousness (and selling 6/05) does have its advantages and freedoms!

Travel and phototograhy are my big splurges - but unlike Bill I’m more of a dirtbag traveller than luxury

Heading back to Namibia next year to 4X4 across the Kalahari then back up into Botswana and the Okavanga.

http://www.twistedcube.com/unclegit/Africa/content/index.html

Some photo’s from this year’s trip in case anyone is interested

Travel, single malt scotch, and more recently, replacing every darn thing that was in my fridge that spoiled after the hurricane blew through Chicago last thursday.

Wow, one heck of a splurge thread!!

“When was the last time you got a half-gallon of great beer for $7.00? ”

I get a half gallon growler refilled at Granite City (a restaurant / brewpub) for $5 on Tuesdays. Otherwise, it’s $9. Just started making my own beer at home too. I’m going to start fiddling with my own recipes very soon. And, I like to ski, a lot. Which is more expensive for me as I live in Iowa, and need to travel to Colorado to do it. However, as I now view most of you as extended family, I will share with you - I’m planning on making my splurge hobby (beermaking) into a business. I hope to go full time with it by Easter.

Uncle Git, you take some beautiful photos!

Guns and ammunition are my weakness. Although, did thin down the collection a bit to just the basics. Reload my own cartridges, so cheaper to shoot. Range fees. All in all target shooting is still less expensive than golf…..at least, the way I do it. Besides, how practical are golf skills?

Whereas my mother doesn’t even have a clue what that means. A childhood of endless collections calls, utilities shut off, charge cards denied for being over their limits, and watching Mom have to go begging to my grandparents for ‘loans’ taught me that I never wanted to live that way. (Thanks, Mom, for the valuable life lesson!)

I think I would have preferred to learn the lesson your way, Slim.

Cato is loaded with mouthpieces for the supply side mantra, a’la Kudlow and Laffer. Allow “most posters” to speak for themselves.

OK, I will speak for myself. Cato is cool with me.

Shifting the tax burden to the middleclass is cool too? How about that good old deficit spending….

Wasn’t Cato the sidekick played by Bruce Lee on “Green Hornet?”

Inspector Clouseau’s Houseboy-’My little yellow friend’

I’m down with Cato.

But the “paying customers” are largely making minimum payments. The zero balancers who are actually good credit risks never have a balance to securitize. Banks have targeted the lowest-quality borrowers for all sorts of credit as the long boom that began with Reagan’s reforms has gone on for 25 years, with only minor interruptions.

If there is any kind of real disruption in the economy, those bad-credit loans largely become losses - some slightly deferred. That’s why financial company earnings are highly deceptive right now. They report profits but are really sitting on enormous losses. Most of the principal will never be paid back and they have to hope they have enough time to collect interest before the whole thing blows up in their faces.

The honest appraisers will emerge because the lenders, who will from now on may have to (gulp) keep the loans they make, will demand that the property appraisals become an accurate reflection of the property’s true value.

Yes.

Better yet, how about we stop “competing” against manufacturers who’s government provides their citizens health insurance and sound pensions? Going up against the likes of Japan where the citizenry have a national healthcare plan instead of burdening employers like Honda and Toyota doesn’t make for a truly competitive market.

can’t we sue Japan under the WTO for these types of subsidies? Don’t we get sued all the time for different types of tax breaks we allow, under WTO? If we can’t sue Japan, then we’ve got to go to some type of socialized healthcare.

“Socialized” healthcare would require the govt. to buy all hospitals and everyone on govt. payroll. The japanese govt. doesn’t own the hospitals but they are smart enough to know that it isn’t a good idea to burden employers with the administration of health benefits.

Better yet, how about we stop “competing” against manufacturers who’s government provides their citizens health insurance and sound pensions?

The government doesn’t “provide” anyone with anything. The health care and pensions are paid for by the taxpayers, i.e. the autoworkers themselves, from the wages that the autoworkers pay them.

The reason universal healthcare provides a competitive advantage for automakers in Japan, Germany, and Canada is that it’s cheaper. US health care spending is 15% of GDP, Germany & Canada 10%, Japan 8%.

“Better yet, how about we stop “competing” against manufacturers who’s government provides their citizens health insurance and sound pensions? Going up against the likes of Japan where the citizenry have a national healthcare plan instead of burdening employers like Honda and Toyota doesn’t make for a truly competitive market.”

Well said, exeter

….and well said, mattR, although I have seen some fine looking American made cars recently. Still, my almost 4 year old Toyota still looks like new after a good vacuum and waxing. Every system works like the day I bought it. Meanwhile my neighbors with the American vehicles are working with the planned obsolescence business model.
Excuse my Dr. Phil-ism when I ask the Big 3: How’s that workin’ for ya?

Er, the wages that the automakers provide them.

No universal social program can be a subsidy to any industry, because everyone pays and everyone benefits. A subsidy exists when society at large pays to give an advantage to a specific industry. Nobody considers public education a subsidy to industry, for example.

So you’re advocating we nationalize our health care? I wouldn’t say the Japanese have “sound pensions” though- their looming retirement crunch makes out Social Security issues look like child’s play.

Yes. Pick your poison. It will happen in some form soon.

You are never going to get the WTO to agree that provision of health care by the government is a government subsidy for any particular industry. Socialized health care has been in place for too long and in too many countries.

That (banana) boat has sailed. (Quick explanation - bananas have been litigated ad nauseum in the WTO)

If the union agreements didn’t allow people to retire so many years before they became eligible for Medicare, it wouldn’t be as much of a problem. The car companies made these agreements when they needed workers and delayed expenses looked like a better deal than increasing salaries. Good for the short term, bad for the long term. It didn’t occur to them that health care expenses might increase - a lot. So I guess short sightedness is nothing new in American business.

Japanese have “sound pensions” though- their looming retirement crunch makes out Social Security issues look like child’s play.

I believe the Japanese government also owns the tobacco companies in Japan. Free smokes == no pension payments

I’ve worked in many countries and US is an anomoly for a modern country. In other nations, businesses don’t have to worry about underfunding healthcare. They just make things.

Healthcare is a competitive disadvantage to US companies.

Or, the automakers could build a relevant product that people want to buy, and stop trying to restructure on the backs of the employees. nah, that makes too much sense.

Funny how you can’t garnish a corporations future profits.

Corporations and priveleged elite have had a 30 year party at our expense. Do they have a clue the party is nearing its end?

The Yen has a ways to go, don’t be surprised for it to hit 102 by year end.

I don’t believe I would have posted it in that format. I know I posted the correlation of the EuroYen to the S&P500 as 0.94 with approximately a 6 hr time lag. But converting a correlation into a percentage drop can be very misleading.

Credit crunch - you have moneys and good prospects, but the bank has no moneys to loan for expansion.

Credit insolvency - you have no moneys and owe interest on your debt, but the bank won’t loan cuz your prospects are not so hot.

The reason the “bank” has no money to loan for subprime mortgages, cdo’s, and certain asset backed cp is that the collateral is deemed at risk of major default (or insolvency). I don’t see any distinction between your credit crunch and credit insolvency in light of current market conditions. My understanding of the term “credit crunch” is when lendors don’t want to lend at any price (interest rate).

A huge difference, 75% of the debt outstanding is junk. Some of the debt will be paid in full, some will not be paid. Good companies are being lumped in with the bad companies.

Solvent, well run companies are not trying to find funds - interest rates are high - these companies are cutting back. The Federal Reserve has an open window policy and the companies that need the moneys cannot get the funding - these companies are credit stretched to the limit. Insolvency.

Main Street believes this to be the result of a few bad mortgages. $4T in corporate debt was repriced ~10% lower. This is a staggering loss. Somebody is sucking a lot of air.

Or think of a credit crunch as “I want to borrow a hundred dollars and the bank says fine but not ’til next month.” Lack of immediate cash.

Credit insolvency “I want to borrow a hundred and the bank says, who is your guarantor”

Last crisis: subprime lending
Next up: covenant-lite lending?

I guess I don’t understand the concept of an investor or bank saying I will buy your debt or lend you money next month. The fact is that the market for certain debt has seized up and market participants are hoping that it is a temporary condition, and that investors will part with their capital in a month or two. But investors are not commiting to buying CLOs or CDOs next month. Market commentators are just expressing our collective hope that the credit crunch dissipates in time.

“I guess I don’t understand the concept of an investor or bank saying I will buy your debt or lend you money next month.”

“I’d gladly pay you Tuesday for a hamburger today.”

–Wimpy–