Brian
Posts:2242
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| 08/26/2008 10:54 AM |
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Despite the S&L crisis, housing prices in San Diego did not drop until 1990 through 1997 (there as definitely a lag and we thought we were immune).
Remember how ugly it was in the early 1990s in San Diego? It will get uglier.
Back in the 1990s we had failures of hundreds of small S&Ls in an industry that needed to consolidate anyway. Today, we will have failures of very large institutions, namely Fannie and Freddie and some large banks.
http://en.wikipedia.org/wiki/Savings_and_Loan_Crisis
The savings and loan crisis of the 1980s and 1990s (commonly referred to as the S&L crisis) was the failure of 747 savings and loan associations (S&Ls) in the United States. The ultimate cost of the crisis is estimated to have totaled around USD$160.1 billion, about $124.6 billion of which was directly paid for by the U.S. government -- that is, the U.S. taxpayer, either directly or through charges on their savings and loan accounts-- Ώ], which contributed to the large budget deficits of the early 1990s. The resulting taxpayer bailout ended up being even larger than it would have been because moral hazard and adverse-selection incentives compounded the system’s losses. ΐ]
The concomitant slowdown in the finance industry and the real estate market may have been a contributing cause of the 1990-1991 economic recession. Between 1986 and 1991, the number of new homes constructed per year dropped from 1.8 million to 1 million, the lowest rate since World War II.
Today's Financial Crisis Enters New Stage
JACKSON HOLE, Wyo. (MarketWatch) -- The financial crisis has entered a new phase and will likely bring total credit losses above $1 trillion, according to a leading academic who has been studying the turmoil since its beginning a year ago.
Princeton University economics professor Hyun Song Shin says the subprime mortgage crisis has already cost financial institutions roughly $500 billion. Now, however, the problem has spread to the real economy, and losses on credit cards, consumer and business debt should match or exceed those from subprime mortgages and the like, he said.
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tpc
Posts:504
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| 08/26/2008 11:49 AM |
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| The s&l crisis of the late 80s and 90s was much different from the current banking crisis. The S&L crisis arose because of a combination of deregulation and allowing S&Ls to engage in self dealing. There were 3 groups engaged in S&L activities. 1) Legit groups. 2) Developers-who bought into s&l because they could avail themselves of cheap money. Developers are among the worlds biggest crap shooters. Crazy manic people. Alowing developers to get their paws on the money in federally insured institutions is suicidal. Then combine the developers with the crazy tax shelters dreamed up by the Reaganites and you have see thru office buildings everywhere, shopping centers appearing in remote locations, a hugh inventory of empty warehouse and industrial buildings, massive ill concieved resort properties, etc. Demand didn't trigger building supply, tax shelter policy did. I saw this one up close and personal. 3) scam artists and crooks who stripped the assets of the S&Ls. Many of the latter were S&Ls were bought with money supplied by Michael Milken, the junk bond king. Moral-you have to be nieve and childlike to believe that deregulation is going to work where access to MONEY is involved. |
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Goingup?
Posts:154
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| 08/26/2008 12:34 PM |
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San Diego was for the most part immune from the S&L crisis of the 80's (prices were actually moving higher during the late 80's).. It was the end of the cold war and following cut in defense spending the casued the last crash in SD houses.
Those 1M housing starts also marked a bottom during the last downturn, and that's where the number is today. It's another indicator in my book RE is near or at the bottom (barring a major jar to the economy).
As for the 1 Trillion number, if 500B has already been written off and the gov just threw 300B at the housing, I guess that means there's only 200B left to go. |
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tpc
Posts:504
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| 08/26/2008 2:46 PM |
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| G---up. SD was immune to the s&l crisis????? How about American Savings, Great america, etc, etc, etc. SD was right in there with the rest of the country. If your benchmark for the bottom is a WAG (wild ass guess), then buy. I prefer a better concieved and thoughtout benchmark to reflect the bottom. And it ain't rocket science to figure out. |
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Brian
Posts:2242
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| 08/26/2008 3:34 PM |
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| And Home Fed, and Imperial Savings, and Executive Life, etc... |
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ssyoo
Posts:7
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| 08/26/2008 5:39 PM |
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| Brian - I tried to start a new post asking you to personally respond, but I think it was removed by the administrator. I've been following your posts for quite a while and think you are insightful and obviously very well informed. I'm currently in escrow on a downtown condo at the Grand and wanted to get your opinion on the price?? Would you mind if I personally e-mailed you on it and got your opinion? Susie. |
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Caligirl43
Posts:135
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| 08/26/2008 7:45 PM |
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| Hey TPC - remember from grade school - "i before e except after c" - (conceived) |
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tpc
Posts:504
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| 08/27/2008 10:20 AM |
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| Cali-I wasn't conceived. I just appeared. What is grade school???? |
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jspoto
Posts:218
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| 08/27/2008 10:31 AM |
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| ssyoo are you kidding ? your going to ask Brian about buying a home. After talking to him you will want to walk away from your deposit. Why is it that people gravitate to negativity and fear? The Grand is an impressive building, the likes of which will not be built again for many years. Have you seen the plans for the development of the lands around the building ? PRIME real estate. |
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Caligirl43
Posts:135
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| 08/27/2008 11:39 AM |
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| Jspoto - I think because Brian clearly does a lot of research and his opinions are fact based and well-founded without bias or emotion is why he makes sense to most of us and why we tend to gravitate toward his opinions much more than the obvious fluff and fold posted here by the real estate and financial folks who are financially hurting the most during these down economic times. |
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jspoto
Posts:218
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| 08/27/2008 12:24 PM |
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| I was out yesterday looking at properties at Aria, Alta, and Apperture. In two of the buildings, they had to organize "tours" in groups because there were so many people looking. That was on a Tuesday. GO out in the market and see for yourself. Stop listening to all the armchair quarterback telling you how horrible it will be for the next hundred years. People gravitate towards others because they are scared and looking for confirmation in groups that they are making the right decision. "Obvious fluff and fold posted here by the real estate..." - are you kidding ? let me ask you one question - If you were contemplating purchasing real estate and wanted to hear a guest speaker, would you go to A - a person who did excellent research and had alot of opinions or B - a person who made multi-millions purchasing real estate thru both up and down markets ? |
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jspoto
Posts:218
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| 08/27/2008 12:29 PM |
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| sorry caligirl - I just read your other post on another thread - you went to hear speaker A. Good luck with your rental (sorry, i mean leasehold estate) |
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JAP
Posts:44
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| 08/27/2008 1:09 PM |
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Posted By jspoto on 08/27/2008 12:24 PM
I was out yesterday looking at properties at Aria, Alta, and Apperture. In two of the buildings, they had to organize "tours" in groups because there were so many people looking. That was on a Tuesday. GO out in the market and see for yourself. Stop listening to all the armchair quarterback telling you how horrible it will be for the next hundred years. People gravitate towards others because they are scared and looking for confirmation in groups that they are making the right decision. "Obvious fluff and fold posted here by the real estate..." - are you kidding ? let me ask you one question - If you were contemplating purchasing real estate and wanted to hear a guest speaker, would you go to A - a person who did excellent research and had alot of opinions or B - a person who made multi-millions purchasing real estate thru both up and down markets ?
What an ego. Please get over yourself. |
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ssyoo
Posts:7
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| 08/27/2008 1:11 PM |
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| JAP - in all fairness, I don't see how jspoto's posts manifest an overinflated ego...I think he's merely conveying his genuine opinions based on his experiences and the facts that he has access to... a right that we all have on this blog! |
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Brian
Posts:2242
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| 08/27/2008 2:00 PM |
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Posted By ssyoo on 08/26/2008 5:39 PM
Brian - I tried to start a new post asking you to personally respond, but I think it was removed by the administrator. I've been following your posts for quite a while and think you are insightful and obviously very well informed. I'm currently in escrow on a downtown condo at the Grand and wanted to get your opinion on the price?? Would you mind if I personally e-mailed you on it and got your opinion? Susie.
If you've done your research and can easily afford the purchase. I think that you're good to go. Best wishes to you.
In all honesty, I would never buy during the summer selling season. Winter is the best time to buy.
PS: But if prices at The Grande continue to drop, your purchase might well be featured in one of my future "knife-catcher" posts *wink*.
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Brian
Posts:2242
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| 08/27/2008 2:06 PM |
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Posted By jspoto on 08/27/2008 12:24 PM
B - a person who made multi-millions purchasing real estate thru both up and down markets ?
That statement implies that he's made millions. True or not, that's not relevant.
He's making that statement to lend himself credibility -- kinda like resume puffing. In new Internet vernacular it's called e-balling (from the showy "baller" culture where the biggest cahuna can crush the little midgets). |
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jspoto
Posts:218
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| 08/27/2008 2:12 PM |
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| I'm not implying my net worth, I'm not trying to lend myself credibility. I'm trying to point out that this entire site has turned 99% negative. It's usually when everyone thinks they got the trade so right is when the market proves them wrong. The contrarian is one who attempts to profit by investing in a manner that differs from the conventional wisdom. History has proven us very successful. |
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Caligirl43
Posts:135
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| 08/27/2008 2:39 PM |
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| But these are negative times Jspoto, really negative times - what can you expect but negativity when we have so much working against us economy wise? Bottom line is I'll do what's best for me when I feel it's the best time for me. |
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sleepybear
Posts:116
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| 08/27/2008 2:50 PM |
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| jspoto and others: Although, "this entire site has turned 99% negative," please do not mistake this site for the real world. |
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Brian
Posts:2242
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