Posted by: The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

51 responses to “Weekly Open Thread (2013-05-27)”

  1. toad37

    @ Ira- Thank you for answering my MLS question on last open thread.

    Mysecretagent.com looks interesting.

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  2. softwarengineer

    Bernanke Dares Seattle Home Owners to Buy Stocks

    Then when he pulls the $1T/yr QE money out of the federal bond market [keeping mortgage interest 6-7% lower than a free market with scarce money] this year [?] or very soon, he’s hoping that will keep interest rates low without federal deficit welfare to the middle incomes.

    Meanwhile, the present/future danger of more short sales is getting news too:

    http://www.reuters.com/article/2013/05/28/fitch-short-sales-now-the-order-of-the-d-idUSFit65858420130528?feedType=RSS&feedName=financialsSector&rpc=43

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  3. Howard

    Mortgage interest rates shot up today to 4% plus…

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  4. Blurtman

    Will they add a drive-through service? Go boomers!

    Top 2 US funeral companies merge as baby boomers boost demand

    http://www.reuters.com/article/2013/05/29/stewartenterprises-servicecorporation-idUSL3N0EA2N720130529?feedType=RSS&feedName=industrialsSector&rpc=43

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  5. No Name Guy

    Be very afraid……

    “There’s a lot of — bluntly — stupid money that jumped into the trade [rental housing] without any infrastructure, without any real capabilities and a kind of build-it-as-you-go mentality that we think is somewhat irresponsible.”

    “And if people think the bottom will fall out of the market when the Fed pulls the curtain, just wait to see what happens to housing when the day comes that Blackstone announces it is shifting from the net buyer to net seller.”

    http://www.zerohedge.com/news/2013-05-29/meanwhile-big-investors-quietly-slip-out-back-door-housing-stupid-money-jumps

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  6. softwarengineer

    RE: Blurtman @ 4

    Hey Ya Got It All Wrong Blurtman

    Bush, Obama and the Yahoos at CDC all say we’re all living MUCH longer lives; so we must butcher ax Social Security and Medicare…..LOL….conversely, the Census Bureau released documents that our live spans in America were getting shorter, WAY down to the 60s levels….that report was conveniently destroyed….I wonder why?

    Buy casket STOCK!

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  7. softwarengineer

    RE: No Name Guy @ 5

    What Me Worry?

    Its you guys in underwater [and soon to be underwater] loans that should worry….if my vast stock investments tank, I lose money….your home mortgage debt tanks and ya can’t afford to sell or walk away, or even sell short….you’re out of the game with a poor credit report if ya do that…

    Ya think ya would learned from the first bubble, not to touch the burner when its hot….ya get burned….

    But Bernanke will print money again when he likely shuts the low interest rate spigot off soon, its just gotta happen? One thing’s for sure in 2014….it will be an interesting year….

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  8. Blurtman

    Obama Sucks!

    Like Cockroaches, Bank Lobbyists Never Really Went Away

    Much has been said about the New York Times’ recent article detailing how lobbyists for Citigroup (who else?) drafted — nearly word for word — legislation that would further deregulate complex derivative transactions for the biggest of the Too Big To Fail banks.

    None of this is — at least should be — terribly surprising.

    We have, after all, experienced decades of lobbyist-driven deregulation, most notably following the 1998 merger between Citicorp (who else?) and Travelers. At the time, the merger was banned by what was left of Glass-Steagall, the Depression-era law that separated commercial banking from riskier activities.

    But the merger was announced in anticipation of Congress and the administration dutifully kicking to the curb that quaint 1933 law that helped usher in decades of stability and growth. In 1999, Citi’s wish was granted, thus setting the megabank consolidation stage for the financial crisis of 2008.

    Now, in the 2013 update, we have Citi once again pulling its campaign contribution and lobbying strings to roll back some of the few potentially effective aspects of the 2010 regulatory reform package enacted in response to the crisis, including a provision that would impose some Glass-Steagall-esque limitations on certain types of potentially dangerous derivative transactions.

    What is surprising, however, is the characterization that the recently uncovered evidence of how the lobbyists serve as the Edgar Bergen to Congress’ Charlie McCarthy is an indication that the Wall Street banks are now “back.”

    Well, guess what, they never went away.
    ……………….

    https://www.redliontrader.com/twitter/neilbarofsky-my-latest-like-cockroaches-bank-lobbyists-never-really-went-away-linkedin-httpt-co9rlnp1aedr/

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  9. softwarengineer

    We’re All Arm Chair Seers

    And blind as bats too.

    “….”Prophesy is a good line of business, but it is full of risks.” – Mark Twain

    No point in burying the lead, folks. The biggest risk to stocks is now bonds, and the speed of yield-curve steepening.

    Last week may have been a major turning point not in equities, but rather in mentality. Both the Fed minutes — which showed quite a few favored “tapering” quantitative easing (which I guess is no longer “forever”) — and volatility in Japan, with the 7%+ collapse in the Nikkei due to bond yields spiking, are shaking confidence in the illusion of stability….”

    http://www.marketwatch.com/story/the-biggest-risk-to-stocks-2013-05-29?siteid=yhoof2

    I’d add even Mark Twain went bankrupt buying up early 20th century real esate….he thought he was right too.

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  10. Blurtman

    RE: softwarengineer @ 9 – Prediction is very hard, especially about the future – Yogi Berra

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  11. No Name Guy

    RE: softwarengineer @ 7

    I’m not in underwater. Heck, I don’t even have a mortgage. Free and clear is the only way to be. I’m holding off buying rental until it shakes out. I wasn’t ready in ’09 or 10, so I missed the current window. I’ll wait patiently, keeping the powder dry, until the next melt down, then buy, Buy, BUY.

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  12. Ira Sacharoff

    By Blurtman @ 4:

    Will they add a drive-through service? Go boomers!

    Top 2 US funeral companies merge as baby boomers boost demand

    http://www.reuters.com/article/2013/05/29/stewartenterprises-servicecorporation-idUSL3N0EA2N720130529?feedType=RSS&feedName=industrialsSector&rpc=43

    But it’s a dying industry.

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  13. Tim McB

    Congrats to KC (I think) for winning the Guess the Price round 6. Only 1k off, not bad.

    http://seattlebubble.com/blog/2013/04/12/guess-the-price-round-6-ready-to-shine-in-fremont/#comments

    Reference:
    http://www.redfin.com/WA/Seattle/4214-Midvale-Ave-N-98103/home/120067

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  14. Howard

    So Tim……….. How was that commute this morning?

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  15. Jillayne Schlicke

    I wonder if this will amount to anything.

    http://dealbook.nytimes.com/2013/05/29/swiss-officials-to-allow-banks-to-sidestep-secrecy-laws/

    Where will people go to hide their money now?

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  16. pfft
  17. ChrisM

    RE: Jillayne Schlicke @ 15 – Of course, the brother of the Mexican President had numerous suspicious forms filled out, but he was above the (US) law.
    http://www.pbs.org/wgbh/pages/frontline/shows/mexico/family/citibankaffair.html

    Not sure why anyone thinks this is even a crime to begin with, esp. if the government enforcers are corrupt to begin with.

    In the meantime, there are opportunities in Micronesia, if you think Caymans isn’t good enough.

    Additionally, the NAR has nice money laundering exemptions:
    http://www.realtor.org/law-and-ethics/complying-with-federal-regulations/anti-money-laundering-rule

    So, I have to wonder if the recent foreign money real estate transactions (esp in California) are just glorified money laundering.

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  18. David Losh

    RE: Jillayne Schlicke @ 15RE: ChrisM @ 17

    I’ve thought the same thing for years, about using mortgage money to launder foreign funds.

    There was a bank here in Seattle that took money from Korea to lend to people here to buy homes. It was all up, and up like a Bedford Falls in It’s a Wonderful Life kind of way, but there have been other financiers I’ve met that I wonder about.

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  19. Blurtman

    RE: David Losh @ 18 – You can be certain that Eric Holder is OK with it, as long as the money launderers are well connected enough.

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  20. softwarengineer

    RE: ChrisM @ 17

    Last I Heard in California

    The Mexican Drug Cartel runs its state headquarters from the California Prison [prostitutes and a luxury style office?]….thank God we legalized pot before organised crime got too big and kept the peoples’ initiatve from passing…..makes me wonder if there are guns to peoples’ heads down there now.

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  21. softwarengineer

    RE: David Losh @ 18

    Yeah David

    We’re furloughing American defense workers July 8th [BTW, 100,000 engineers work for DOD] for a paltry $1.8B in savings, but God forbid we reduce the defense contrator base instead [the rest of the $45B Sequestor needed] …..a lot of its foreign owned too, i.e., BAE.

    Our American federal defense spending tax dollars hard at work putting foreigners in jobs….albeit butcher axing Americans.

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  22. softwarengineer

    RE: Jillayne Schlicke @ 15
    Jillayne

    I call banks at 0% Money markets “Mattress Banks”….albeit, your matress would be safer place to hide it….ask that Greece island….LOL

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  23. softwarengineer

    RE: pfft @ 16
    Yeak Pfft

    All your Democrat cable news rants about is the Republican women pulling out of the presidential race…..like we have two political NWO parties now-a-days…..LOL

    All the Republican FOX rants about is Obama lies….

    All the NWO politicians from both parties lie, when it comes to getting real legal Americans working again…

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  24. pfft

    By softwarengineer @ 23:

    RE: pfft @ 16
    Yeak Pfft

    All your Democrat cable news rants about is the Republican women pulling out of the presidential race…..like we have two political NWO parties now-a-days…..LOL

    All the Republican FOX rants about is Obama lies….

    All the NWO politicians from both parties lie, when it comes to getting real legal Americans working again…

    no offense dude but I don’t know what you’re trying to say. can you restate that?

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  25. pfft

    Unbelievable.

    Here’s The Threatening Letter Sent To Obama And Mayor Bloomberg

    Read more: http://www.businessinsider.com/ricin-letters-obama-bloomberg-gun-control-pictures-2013-5#ixzz2UoQOX78z

    What is is so stupid about these gun owners is that they think people are going to take away their guns. They don’t even know the law. In the future you may not be able to buy certain guns but nobody is taking your guns away.

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  26. Plymster

    RE: pfft @ 25 – Restricting certain gun sales is just where the slippery slope STARTS.

    It’s just like the First Amendment. First we can’t shout “Fire!!!” in a crowded movie theater, and now NOBODY can blog about politics, Facebook pictures of our kids, or tweet about the horrible service they got at the local coffee shop. Heck, you can’t even publicly spend money to buy air-time to spew lies about a candidate you don’t want elected. The First Amendment was completely gutted by this sort of slippery slopism.

    Oh, wait…

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  27. wreckingbull

    RE: pfft @ 16 – Are you saying that you are happy that the IRS is in charge of implementing Obamacare? The GAO is not so sure.

    http://www.gao.gov/assets/330/320403.pdf

    What, Tea Partier? NO CANCER TREATMENT FOR YOU! NEXT!

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  28. sam

    http://www.reuters.com/article/2013/05/30/usa-housing-idUSL2N0EB0U320130530?feedType=RSS&feedName=marketsNews&rpc=43

    Where are more numbers on the shadow inventory? Are banks (not just Fannie/Freddie) holding on to inventory and creating a supply issue and driving prices up?

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  29. wreckingbull

    RE: sam @ 28 – Agreed. The problem is not REO shadow inventory, it is hamster-wheel shadow inventory.

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  30. Blurtman

    American Islamic Terrorist Killed in Syria

    http://www.seattlepi.com/news/us/article/Family-Michigan-woman-33-killed-in-Syria-fight-4563679.php

    President Obama, a comment on the US exporting of terrorism, please.

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  31. pfft

    By wreckingbull @ 27:

    RE: pfft @ 16 – Are you saying that you are happy that the IRS is in charge of implementing Obamacare? The GAO is not so sure.

    http://www.gao.gov/assets/330/320403.pdf

    What, Tea Partier? NO CANCER TREATMENT FOR YOU! NEXT!

    never going to happen.

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  32. wreckingbull

    RE: pfft @ 31 – Answer the question, pfft, Do you think the IRS is the right organization to run 47 major provisions of Obamacare?

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  33. whatsmyname

    By wreckingbull @ 32:

    RE: pfft @ 31 – Answer the question, pfft, Do you think the IRS is the right organization to run 47 major provisions of Obamacare?

    Poor pfft is probably reading through your entire power point to give you an informed answer. I’ll answer in his place. Yes, the IRS is the right organization to work through the taxation administration issues arising from this legislation. They are clearly identified as such in exhibit IV. These issues do not involve patient care decisions.

    Your entire slide show is an IRS affirmative response to a GAO recommendation that they do this. You should read this stuff before you hyperventilate yourself into the fever-swamp. Your previous hint that the IRS will be denying cancer care to Freeper types is pure fantasy. albeit one that reminds that every cloud has a silver lining.

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  34. Blurtman

    Blurtman’s home is now up about 7% from his early 2005 purchase. It was down about 10% at the RE market crash lows. So that is a 17% roundtrip if I have done the math correctly. Hence I have increased my upper purchase price to $15, from $10, for red wine typically purchased at Safeway. I trust that inflation will not keep me in the same exact reds, which might cause me to drink more. Green shoots!

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  35. Dirty Renter in Banjo Country

    Blodgett is on tv all the time; this morning Grubman was on.
    Let’s make it a trifecta and ask Madoff to host ‘Money Matters’.

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  36. pfft

    By wreckingbull @ 32:

    RE: pfft @ 31 – Answer the question, pfft, Do you think the IRS is the right organization to run 47 major provisions of Obamacare?

    I don’t know I don’t know what they’re going to do. do you have a better agency in mind?

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  37. wreckingbull

    RE: whatsmyname @ 33 – Uh, it was a joke, dude. I guess I’ll have to put cute little smiley faces so you can see this. Do you really think the soup Nazi works for the IRS?

    The part that is not a joke is that the IRS has gotten dangerously large and out of control. This is going to make a bad situation worse. Good for you if you have had good experiences with them. I have not.

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  38. wreckingbull

    RE: pfft @ 36 – Nice logic, pfft! The IRS is the least-sucky organization to take it on, but we have to ram this through, so lets just use them.

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  39. pfft

    Can there be a bond bubble if everyone is freaking out on every uptick? If this was a bon bubble we’d hear buy the dips. As the economy, wages and corporate profits recover the extra savings will provide support for interest rates.

    http://krugman.blogs.nytimes.com/2013/06/01/what-we-have-here-is-a-failure-to-communicate/

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  40. pfft

    By Dirty Renter in Banjo Country @ 35:

    Blodgett is on tv all the time; this morning Grubman was on.
    Let’s make it a trifecta and ask Madoff to host ‘Money Matters’.

    going after blodgett was a mistake.

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  41. pfft

    By wreckingbull @ 38:

    RE: pfft @ 36 – Nice logic, pfft! The IRS is the least-sucky organization to take it on, but we have to ram this through, so lets just use them.

    the IRS is only dealing with the tax side of obamacare. do you have a better organization to collect taxes?

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  42. wreckingbull

    RE: pfft @ 41 – Read Appendix IV. Or “Exhibit IV” as whatshisname calls it. You guys both need to work on reading comprehension. Quite a bit more than just the “tax side of obamacare”

    BTW, I like this one:

    “Amends the cellulosic biofuel producer credit
    (nonrefundable tax credit of about $1.01 for
    each gallon of qualified fuel production of the
    producer) to exclude fuels with significant
    water, sediment, or ash content (such as black
    liquor). ”

    This one is good too.

    “Clarifies and enhances the applications of the
    economic substance doctrine and imposes
    penalties for underpayments attributable to
    transaction lacking economic substance. ”

    OK, my gut hurts from laughing. I need to go now.

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  43. whatsmyname

    By wreckingbull @ 37:

    RE: whatsmyname @ 33 – Uh, it was a joke, dude. I guess I’ll have to put cute little smiley faces so you can see this.

    Is this the Limbaugh, “Hey I’m just a comedian” defense? The point you were trying to make was obvious enough. Also wrong. Your toe-tapping follow-up demand for a response made it irresistible for me to jump in.

    Also, thanks for your post 42 concern about my reading comprehension, but tax credit changes and tax penalties, as in your examples, are tax issues for most English speakers. It was you that insisted all 47 issues were obamacare, so you have successfully refuted one poster here.

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  44. Macro Investor

    By pfft @ 39:

    Can there be a bond bubble if everyone is freaking out on every uptick? If this was a bon bubble we’d hear buy the dips. As the economy, wages and corporate profits recover the extra savings will provide support for interest rates.

    http://krugman.blogs.nytimes.com/2013/06/01/what-we-have-here-is-a-failure-to-communicate/

    Quoting Krugman is like quoting a lobbyist. Or asking Pepsi what you should drink. Or believing anything a real estate agent says. You have the intellect of a chimp.

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  45. pfft

    By wreckingbull @ 42:

    RE: pfft @ 41 – Read Appendix IV. Or “Exhibit IV” as whatshisname calls it. You guys both need to work on reading comprehension. Quite a bit more than just the “tax side of obamacare”

    BTW, I like this one:

    “Amends the cellulosic biofuel producer credit
    (nonrefundable tax credit of about $1.01 for
    each gallon of qualified fuel production of the
    producer) to exclude fuels with significant
    water, sediment, or ash content (such as black
    liquor). ”

    This one is good too.

    “Clarifies and enhances the applications of the
    economic substance doctrine and imposes
    penalties for underpayments attributable to
    transaction lacking economic substance. ”

    OK, my gut hurts from laughing. I need to go now.

    to an agenda 21 meeting? why are you laughing?

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  46. pfft

    By Macro Investor @ 44:

    By pfft @ 39:
    Can there be a bond bubble if everyone is freaking out on every uptick? If this was a bon bubble we’d hear buy the dips. As the economy, wages and corporate profits recover the extra savings will provide support for interest rates.

    http://krugman.blogs.nytimes.com/2013/06/01/what-we-have-here-is-a-failure-to-communicate/

    Quoting Krugman is like quoting a lobbyist. Or asking Pepsi what you should drink. Or believing anything a real estate agent says. You have the intellect of a chimp.

    paul krugman has been right since day one of this crisis. I should trust anything he says? He’s a Princeton economist. He literraly wrote the book in on economics. He also won a Nobel Prize. What again were you saying?

    Paul Krugman Is America’s Most Correct Pundit
    http://gawker.com/5797755/paul-krugman-is-americas-most-correct-pundit

    Actually I am going to turn this back around on you. Who should I listen to? Roubini? Peter Schiff? Some right-wing think tank? CNBC? I’ll stick with Krugman.

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  47. Macro Investor

    RE: pfft @ 46 – “Who should I listen to?”

    You could think for yourself.
    Never mind… it is hopeless.

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  48. David Losh

    RE: pfft @ 46

    Krugman, and anyone else who followed the party line of Fed interference was correct. It didn’t take a genius to see that lowering interest rates by infusing cash would increase speculation in commodities, and assets. What it didn’t do was help the individuals who think they got something only to have it taken away, again.

    So Krugman will get rich, and we will pay for that for decades to come.

    Roubini, you’ll notice got rich, Shiller of Case Shiller got rich, Glenn Beck got more rich, the same as Limbaugh.

    All the talking heads get rich, but you, the guy who is quoting the BS, gets nothing.

    You need to wake up because we are moving into the corrections that we all knew were coming. You are either situated or not, but in my opinion the cards are already dealt.

    What do you think the world will look like after Obama leaves office? What is the next administration going to look like? Those are the questions we need to be asking.

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  49. Blurtman

    RE: David Losh @ 48 – President Clinton and Vice President Khardashian will be up to the challenge.

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  50. whatsmyname

    By Macro Investor @ 44:

    Quoting Krugman is like quoting a lobbyist. Or asking Pepsi what you should drink. Or believing anything a real estate agent says. You have the intellect of a chimp.

    What a devastating argument. I am sure that M.I. could have gone the easy route, and refuted everything pfft and Krugman said without breaking a sweat.
    Or one thing………

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  51. pfft

    By Macro Investor @ 47:

    RE: pfft @ 46 – “Who should I listen to?”

    You could think for yourself.
    Never mind… it is hopeless.

    right because I’m an economist? I do think for myself. I read many sources and weigh the evidence and real-time results. Pre-crisis I was a follower of Austrian economics. I was even against the stimulus. When GM and Chrysler almost went under I had to rethink everything. I became a Keynesian. Austerity in Europe told me I was right in real-time. I dropped belief in a gold standard too!

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