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NEW -> Contingent Buyer Assistance Program
[quote author="muzie" date=1221132364]From the Lehman conference call:



"[The Lehman] base case assumes national home prices drop 32% peak to trough, vs. 18% to date, with California down 50% vs 27% to date."

Ian T. Lowitt, Lehman CFO



http://investor.shareholder.com/lehman/events.cfm







Fifty percent. Jesus.</blockquote>


Nice that the the financial community is waking up to how bad it will really be...
 
[quote author="IrvineRenter" date=1221133033][quote author="muzie" date=1221132364]From the Lehman conference call:



"[The Lehman] base case assumes national home prices drop 32% peak to trough, vs. 18% to date, with California down 50% vs 27% to date."

Ian T. Lowitt, Lehman CFO



http://investor.shareholder.com/lehman/events.cfm







Fifty percent. Jesus.</blockquote>


Nice that the the financial community is waking up to how bad it will really be...</blockquote>


And people thought I was bearish. BTW, Irvine isn't immune, it's just behind the curve.
 
[quote author="Astute Observer" date=1221173013]After a 100% increase, a 50% drop just does not sound sufficient to bring it back to where it was... ;)</blockquote>


Acutally ,mathematically it is the same. For instance, let's say a foobar cost $1000. After a 100% increase, the foobar costs $2000. From $2000, a 50% drop is .5 x 2000 = $1000. So after a 100% increase, a 50% drop does bring it back to the original foobar price.
 
[quote author="IrvineRenter" date=1221133033][quote author="muzie" date=1221132364]From the Lehman conference call:



"[The Lehman] base case assumes national home prices drop 32% peak to trough, vs. 18% to date, with California down 50% vs 27% to date."

Ian T. Lowitt, Lehman CFO



http://investor.shareholder.com/lehman/events.cfm







Fifty percent. Jesus.</blockquote>


Nice that the the financial community is waking up to how bad it will really be...</blockquote>


They?ve been shopping their $90B commercial real estate portfolio over the past few months to no avail.

They were hoping to land a buyer for the entire portfolio rather than selling it off piece by piece.

Looks like they?ve hit the panic button, shifted focus, and are now willing to do whatever necessary to survive.

No different than a number of individuals out there that are in the same boat and have taken on water.
 
[quote author="Anonymous" date=1221177925][quote author="Astute Observer" date=1221173013]After a 100% increase, a 50% drop just does not sound sufficient to bring it back to where it was... ;)</blockquote>


Acutally ,mathematically it is the same. For instance, let's say a foobar cost $1000. After a 100% increase, the foobar costs $2000. From $2000, a 50% drop is .5 x 2000 = $1000. So after a 100% increase, a 50% drop does bring it back to the original foobar price.</blockquote>




If you look at the Case-Schiller data, and project a return to 2000 dollar values (not inflation adjusted), it is worse than that.



For LA,



<strong>Lowest 25% peaked at 339.78, so a 70.6% decrease is needed to get to CS100</strong>



Middle 50%, 283.44, 64.7%



Highest 25%, 240.26, 58.4%







For SD, which is further along and didn't shoot as high:



lowest 25%, 296.6, 66%



Mid 50%, 254.56, 60.7%



Highest 25%, 250.34, 60.0%
 
Hey I am talking about foobar's here, which are theoretical things in their own theoretical mathematical world. I am not making house price predictions.
 
[quote author="no_vaseline" date=1221177396][quote author="IrvineRenter" date=1221133033][quote author="muzie" date=1221132364]From the Lehman conference call:



"[The Lehman] base case assumes national home prices drop 32% peak to trough, vs. 18% to date, with California down 50% vs 27% to date."

Ian T. Lowitt, Lehman CFO



http://investor.shareholder.com/lehman/events.cfm







Fifty percent. Jesus.</blockquote>


Nice that the the financial community is waking up to how bad it will really be...</blockquote>


And people thought I was bearish. BTW, Irvine isn't immune, it's just behind the curve.</blockquote>


But I thought Irvine was different?
 
Why this is on Canadian Business Online beats me. The democrats want to have Fannie and Freddie suspend foreclosures.



<a href="http://www.canadianbusiness.com/markets/market_news/article.jsp?content=D934OHUO9">http://www.canadianbusiness.com/markets/market_news/article.jsp?content=D934OHUO9</a>
 
[quote author="No_Such_Reality" date=1221215827]Why this is on Canadian Business Online beats me. The democrats want to have Fannie and Freddie suspend foreclosures.



<a href="http://www.canadianbusiness.com/markets/market_news/article.jsp?content=D934OHUO9">http://www.canadianbusiness.com/markets/market_news/article.jsp?content=D934OHUO9</a></blockquote>


I saw that on <a href="http://calculatedrisk.blogspot.com/2008/09/bloomberg-senators-ask-fannie-freddie.html">Calculated Risk</a>. I hope they do it. In my opinion, you would see a massive wave of defaults if they did this. If you were barely hanging on and considering giving up, that would be the time to stop making your payments because you know the foreclosure process will be delayed and you will get an extra 90 days. Also, it will cause interest rates to jump almost immediately as investors realize they will not have the ability to foreclose and get their money back if people stop paying. It would greatly magnify their risk.
 
[quote author="IrvineRenter" date=1221220594][quote author="No_Such_Reality" date=1221215827]Why this is on Canadian Business Online beats me. The democrats want to have Fannie and Freddie suspend foreclosures.



<a href="http://www.canadianbusiness.com/markets/market_news/article.jsp?content=D934OHUO9">http://www.canadianbusiness.com/markets/market_news/article.jsp?content=D934OHUO9</a></blockquote>


I saw that on <a href="http://calculatedrisk.blogspot.com/2008/09/bloomberg-senators-ask-fannie-freddie.html">Calculated Risk</a>. I hope they do it. In my opinion, you would see a massive wave of defaults if they did this. If you were barely hanging on and considering giving up, that would be the time to stop making your payments because you know the foreclosure process will be delayed and you will get an extra 90 days. Also, it will cause interest rates to jump almost immediately as investors realize they will not have the ability to foreclose and get their money back if people stop paying. It would greatly magnify their risk.</blockquote>


I've been falling behind on Calculated Risk. I really miss the insight Tanta and CR provided, but as of late, there's so much financial news that they are largely exerpting it and no longer providing the in depth insight that they used to.
 
[quote author="Anonymous" date=1221267864]http://piggington.com/shambling_towards_affordability



http://piggington.com/images/pricetoincome0608.gif</blockquote>


In 2003/2004 we were at the top of what would have been a bubble similar to the late 80s/early 90s. Now that San Diego has declined back to 2003 pricing, they are back to price levels approximating the degree of inflation that earlier bubble had. If history repeats itself with respect to the bottom, they have about 20% more to drop, and it will take several more years to get there. I would also note that OC has been 1 year behind San Diego for the entire bubble. They started earlier, peaked earlier, and crashed earlier.
 
I haven't been here much, because all I've been doing is reading

Calculated Risk, and I can't keep up on that.



Well, surely we live in interesting times.



I prefer boring times myself.



Everybody should take in Tanta's mortgage pig/Palin cartoon.
 
Looks like GM is trying to get in line for Government intervention too.



<a href="http://online.wsj.com/article/SB122124521106329063.html">Wagoner State Case for Federal Loans (Wall Street Journal)</a>



Although I must admit, $50 Billion sounds like a spit in the bucket. But then again, they're only 'worth' $7 billion at the moment...
 
They can die. They should have died years ago but regulatory loopholes made SUV's popular and profitable and GM was able to march on for a bit.



Good riddance.
 
F & F are so last week.



Lehman going dooowwwnnnnn.



They are doing "netting" in advance of a probable bk

filing Monday. I assume you can't file on Sunday, bk courts

not open. If no bk, netting trades never happened.



I don't like this at all.



Hysterical?? CR bears saying maybe bank holiday Monday.

Glad I have some cash in the non-mattress.
 
<blockquote>In a rushed bid to ride out the storm sweeping American finance, 94-year-old Merrill Lynch & Co. agreed late Sunday to sell itself to Bank of America Corp. for roughly $44 billion.</blockquote>




<a href="http://online.wsj.com/article/SB122142278543033525.html?mod=mktw">http://online.wsj.com/article/SB122142278543033525.html?mod=mktw</a>
 
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