Comments on: Case-Shiller Index falls 17.4% http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/ Macro Perspective on the Capital Markets, Economy, Geopolitics, Technology, and Digital Media Sat, 21 Nov 2009 08:40:44 -0500 http://wordpress.org/?v=2.8.5 hourly 1 By: philipat http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128933 philipat Wed, 26 Nov 2008 02:12:47 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128933 Sorry, I meant inflation adjusted or expressed as a multiple of income. Sorry, I meant inflation adjusted or expressed as a multiple of income.

]]> By: philipat http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128931 philipat Wed, 26 Nov 2008 02:10:25 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128931 Yes, % YOY price changes alone can be misleading. The latest CS alone tempts the view that wow, it's dropped so much it must be near bottom already. Yet there were 20 years of price increases and just 2 of declines. To see the complete picture, a bar chart below of the same years showing median house price in the same markets would be useful. Yes, % YOY price changes alone can be misleading. The latest CS alone tempts the view that wow, it’s dropped so much it must be near bottom already. Yet there were 20 years of price increases and just 2 of declines. To see the complete picture, a bar chart below of the same years showing median house price in the same markets would be useful.

]]> By: Pete http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128929 Pete Wed, 26 Nov 2008 02:04:08 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128929 CR ( http://calculatedrisk.blogspot.com/)again has several threads on this today too (here's one - http://calculatedrisk.blogspot.com/2008/11/real-house-prices.html ) . A few of those distress sales /REOs etc in specific locations (good urban areas ,close to rapid transit etc) are very tempting but still may be priced far from the bottom . CR ( http://calculatedrisk.blogspot.com/)again has several threads on this today too (here’s one – http://calculatedrisk.blogspot.com/2008/11/real-house-prices.html )
. A few of those distress sales /REOs etc in specific locations (good urban areas ,close to rapid transit etc) are very tempting but still may be priced far from the bottom .

]]> By: Steve Barry http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128924 Steve Barry Wed, 26 Nov 2008 01:38:40 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128924 This is no joke...at the current rate, housing will bottom in 2016. The spike up started in 1996...peaked in 2006...it looks symmetrical, so in 2016, it makes the round trip. This is no joke…at the current rate, housing will bottom in 2016. The spike up started in 1996…peaked in 2006…it looks symmetrical, so in 2016, it makes the round trip.

]]> By: AGG http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128911 AGG Wed, 26 Nov 2008 00:03:43 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128911 Average gross wages multiplied by 2.5 is the eventual average sale price of a residential property. High unemployment obviously will exacerbate this trend because a plethora of "motivated sellers" will depress prices further. The problem is further complicated by the current green push to forget the bling and consume only what you need. This is the new status symbol. What do you need a two car garage for if nobody wants two cars? (never mind a three and four car garage). How does 3,000 square feet fare against 1,500 square feet in projected heating and cooling costs? The only thing I see gaining in price is fertile land. The whole modern living model is in jeopardy. Reducing yourself is not tree hugging any more; It's IN. Average gross wages multiplied by 2.5 is the eventual average sale price of a residential property. High unemployment obviously will exacerbate this trend because a plethora of “motivated sellers” will depress prices further. The problem is further complicated by the current green push to forget the bling and consume only what you need. This is the new status symbol. What do you need a two car garage for if nobody wants two cars? (never mind a three and four car garage). How does 3,000 square feet fare against 1,500 square feet in projected heating and cooling costs? The only thing I see gaining in price is fertile land. The whole modern living model is in jeopardy. Reducing yourself is not tree hugging any more; It’s IN.

]]> By: Mannwich http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128904 Mannwich Tue, 25 Nov 2008 22:59:10 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128904 This is not a good sign. Looks like no country will be spared by this downturn.... http://www.nytimes.com/2008/11/26/business/worldbusiness/26chinasteel.html?hp This is not a good sign. Looks like no country will be spared by this downturn….

http://www.nytimes.com/2008/11/26/business/worldbusiness/26chinasteel.html?hp

]]> By: Mannwich http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128900 Mannwich Tue, 25 Nov 2008 22:51:37 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128900 Bruce: From what I see/hear, I think that far too many people are STILL in denial (or shock) about the state of things today. Honestly, not enough people have a clue (or want to have a clue) about what's going on, even the basics..... Me-thinks that too many will use the holidays to stay mired in blissful denial and/or drown their sorrows in buying even more goods they don't need. Credit is still far too easy for too many people. The first place the masses can look for a role model in how to handle debt are the Feds. How are they doing on that front? 'Nuff said there. Bruce: From what I see/hear, I think that far too many people are STILL in denial (or shock) about the state of things today. Honestly, not enough people have a clue (or want to have a clue) about what’s going on, even the basics…..

Me-thinks that too many will use the holidays to stay mired in blissful denial and/or drown their sorrows in buying even more goods they don’t need. Credit is still far too easy for too many people.

The first place the masses can look for a role model in how to handle debt are the Feds. How are they doing on that front? ‘Nuff said there.

]]> By: ButtoMcFarty http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128899 ButtoMcFarty Tue, 25 Nov 2008 22:50:31 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128899 I bought my sweetie a swimman ipod yesterday. I'm asking for some new Asics trainers. Shopping done. Ideally we'll be fitter when the EOTWAWKI comes. :) I bought my sweetie a swimman ipod yesterday.
I’m asking for some new Asics trainers.
Shopping done.

Ideally we’ll be fitter when the EOTWAWKI comes.

:)

]]> By: Bruce in Tn http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128888 Bruce in Tn Tue, 25 Nov 2008 22:12:29 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128888 Home from the salt mine... Mannwich: Let's just think about this for a second or two...let's say that the retailers, by slashing prices, are able to get people to buy so that the Xmas season is merely awful and not catastrophic...ok.. That would mean that the late fall 2008 consumer takes on "non-productive" debt (presents, not starting up a business, you know..) just at the time job losses start to accelerate. Plus next quarter has so many unknowns...like, will China abandon buying our debt? Will oil start to go up in price? Are pension funds going to require higher state and local taxes...(see Mish today), is CRE going to be the problem we all think in early 2009?... Maybe the consumer would be Happier this holiday season if they were more solvent.. Home from the salt mine…

Mannwich: Let’s just think about this for a second or two…let’s say that the retailers, by slashing prices, are able to get people to buy so that the Xmas season is merely awful and not catastrophic…ok..

That would mean that the late fall 2008 consumer takes on “non-productive” debt (presents, not starting up a business, you know..) just at the time job losses start to accelerate. Plus next quarter has so many unknowns…like, will China abandon buying our debt? Will oil start to go up in price? Are pension funds going to require higher state and local taxes…(see Mish today), is CRE going to be the problem we all think in early 2009?…

Maybe the consumer would be Happier this holiday season if they were more solvent..

]]> By: Mannwich http://www.ritholtz.com/blog/2008/11/case-shiller-index-falls-174/comment-page-1/#comment-128879 Mannwich Tue, 25 Nov 2008 21:35:01 +0000 http://www.ritholtz.com/blog/?p=10890#comment-128879 @Bruce: I agree with you but I have a feeling the expectations are set so low for Black Friday that anything short of the apocalypse is going to be viewed positively by the market....at least for the very short term. Any quasi-positive news (even of the delusional type) in this environment seems to spur a buying panic, which says to me that people still aren't fearful enough (and still too worried about missing the bottom) of the unprecedented times we are living in. IMO, the real bad news (more lost jobs in droves) isn't likely to start happening until Q1 of '09. @Bruce: I agree with you but I have a feeling the expectations are set so low for Black Friday that anything short of the apocalypse is going to be viewed positively by the market….at least for the very short term. Any quasi-positive news (even of the delusional type) in this environment seems to spur a buying panic, which says to me that people still aren’t fearful enough (and still too worried about missing the bottom) of the unprecedented times we are living in.

IMO, the real bad news (more lost jobs in droves) isn’t likely to start happening until Q1 of ‘09.

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