Wednesday, March 01, 2006

New York Times Reporter Wonders If Anyone Remembers The Last Housing Bust


By Elaine Meinel Supkis

Some young whelp of a reporters looks at the stats of the last Bush housing bust and says, "Who remembers it? No one!" Well, buddy boy, I remember it vividly because I lost $100,000 thanks to that! And I am still pissed off about why.

From the NYT:

YOU remember the great real estate crash of the 1990's, don't you?

In New York, inflation-adjusted prices dropped almost a third in less than a decade. The fall was even worse in Los Angeles, and it wasn't pretty in Boston, San Francisco or Washington, either. Thousands of families were forced into much smaller homes. Many have never lived as well as they did in those giddy pre-crash years. It was a painful preview of what the dot-com meltdown of 2000 would bring.

What? You don't remember any of this? You think I just made up those numbers about plummeting house values?

I didn't. The real estate crash really happened. The median house price in the New York area fell 12 percent from 1988 to 1995, which is nearly 33 percent in inflation-adjusted terms.
My husband got injured at work right in the middle of this mess. I had to use all resources while waiting for the courts to hear his several cases. This took years!

And so I sold my house in a very down market, lost my equity, lived in a tent, YES, A TENT, you moron! While the courts ran through the case, we won, we now have a house which has zero debts because I am like Scarlett O'Hara, nevermore!

Indeed.

I know what true suffering is, how it feels to fall all the way to the bottom, visiting food pantries, for god's sake. My son's school raised money to buy him shoes, for example. I had to sell our flock of sheep, too. All sorts of things. Thank goodness, in summer, I had a garden and chickens and ducks! And turkeys. So we had pretty good food, in summer.

In winter, I melted snow on the woodstove for water.

This idiot thinks no one sold their homes during that crash! Many families lost jobs, they had to relocate, often to other communities, seeking work. They, too, lost big time. The pain of every crash hurts people. My grandparents didn't even notice the Great Depression but all around them, people suffered. They weren't so brain dead as to imagine this was no big deal.

Why does the Times hire idiots like this? For shame, for shame. Is the mental illness afflicting most of their editorial opinion writers seeping into the entire newspaper?

Heh. Obviously.

All our pundits are screaming at us to not worry about the hostile sheiks of the UAE running our vital port systems! They don't care if we lose housing value, no one will notice! The home ATM machine shutting down won't translate into millions of people losing jobs!

Here is a much better article, head and shoulders above the garbage in the New York Times: From AP:
Consumers, lured out to the stores by the warmest January in more than a century, spent at a rapid clip that outpaced their incomes. However, construction activity slowed to the slowest gain in seven months, indicating the nation's housing boom is easing.

The Commerce Department reported Wednesday that personal spending shot up by 0.9 percent, the strongest gain in six months, while incomes rose by a solid 0.7 percent.

But in a separate report, the department said that construction spending rose by a tiny 0.2 percent in January, the weakest gain in seven months and far below the 1 percent increase Wall Street had been expecting.

A big reason for the slowdown was a tiny 0.1 percent increase in private home building, far lower than the 0.9 percent surge in December. Economists believe housing, which has been setting sales records for five straight years, is set to slow this year. Sales of both new and previously owned homes fell in January despite the unusually warm weather.
Oh oh, the pesky popping ballon noise! People spent money like drunken sailors because the entire media system was screaming at them to spend and the amount was greater than ever before only because of INFLATION. If the rise in spending was pro-rated with the rise in prices then the trend would be clear to even clowns: spending had to go up since costs went up. And the dollar is worth less.

Once the dour effects of the loss of free money via going steeply into debt at a cheap interest rate will be gone. Only the nightmarish 24%+ credit card loans will remain.
Economists say that this is exactly the wrong time for the savings rate to dip into negative territory with the impending retirement of 78 million baby boomers.

Part of the reason for the dip is that Americans who own homes felt more wealthy in recent years given the huge increases in home values. That spurred them to spend more of their paychecks since their net worth was increasing with their rising home values.

However, the Federal Reserve reported last week that even with the rise in home values, Americans' net worth rose over the past three years at the slowest pace in more than a decade, reflecting in part reduced investments in the stock market since the bursting of the Internet stock bubble at the beginning of the decade.
People's net worth could barely stay afloat even with the tremendous increase in value of their homes? This is terrible news. Income down, the house balloon barely able to make up the difference and now, that gone, we face ruthless cutting of people's incomes, lock outs, give backs, bankruptcies and the entire sheebang of a depression which happens when a government cuts back on the inflation ruthlessly by slashing the money available for workers and not taxing the rich.

Yes, all depressions come because the rich don't have to re-invest their money in capitalist ventures, they put it in "safe" havens and to keep it valuable, need a depression so the dime stowed away in bonds can make money while doing absolutely nothing.

Ie: buying America's government debts and forcing us to pay them back while they pay no taxes.

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