Comments on: Time for a Reality Check http://www.ritholtz.com/blog/2009/02/time-for-a-reality-check/ Macro Perspective on the Capital Markets, Economy, Geopolitics, Technology, and Digital Media Tue, 14 Feb 2012 17:26:45 +0000 hourly 1 http://wordpress.org/?v=3.0.5 By: mikeinpanglao http://www.ritholtz.com/blog/2009/02/time-for-a-reality-check/comment-page-1/#comment-146251 mikeinpanglao Tue, 17 Feb 2009 11:39:43 +0000 http://www.ritholtz.com/blog/?p=19090#comment-146251 @usphoenix What happens when America catches pneumonia? @usphoenix

What happens when America catches pneumonia?

]]> By: usphoenix http://www.ritholtz.com/blog/2009/02/time-for-a-reality-check/comment-page-1/#comment-146180 usphoenix Tue, 17 Feb 2009 01:17:36 +0000 http://www.ritholtz.com/blog/?p=19090#comment-146180 I am reminded of what is probably a very old saying, that most considered irrelevant today: When America sneezes, Japan gets the flu. Just change Japan to the world. Perhaps there was a time where parts of the globe were not dependent on us. Time changes everything. I am reminded of what is probably a very old saying, that most considered irrelevant today:

When America sneezes, Japan gets the flu. Just change Japan to the world. Perhaps there was a time where parts of the globe were not dependent on us. Time changes everything.

]]> By: izzy http://www.ritholtz.com/blog/2009/02/time-for-a-reality-check/comment-page-1/#comment-146106 izzy Mon, 16 Feb 2009 18:03:53 +0000 http://www.ritholtz.com/blog/?p=19090#comment-146106 Check out the plan by Phil at http://www.philstockworld.com/2009/02/16/for-timmy-g-how-to-solve-the-housing-crisis-tomorrow/ . I love it because it's simple, bold and can immediately solve the housing crisis as well as the bank. THis is just the sort of out of the box thinking that Geithner need to come up with. What'd you think Barry??? Check out the plan by Phil at http://www.philstockworld.com/2009/02/16/for-timmy-g-how-to-solve-the-housing-crisis-tomorrow/ . I love it because it’s simple, bold and can immediately solve the housing crisis as well as the bank. THis is just the sort of out of the box thinking that Geithner need to come up with.

What’d you think Barry???

]]> By: How the Common Man Sees It http://www.ritholtz.com/blog/2009/02/time-for-a-reality-check/comment-page-1/#comment-146102 How the Common Man Sees It Mon, 16 Feb 2009 18:01:28 +0000 http://www.ritholtz.com/blog/?p=19090#comment-146102 I think a writedown of 20% off the top of all debt owed worldwide and then a new set of lending standards in order to prevent those people from ratcheting things back up would work. If it doesn't then another 20%. At some point people will become economically viable again Also, he talks about 20 million unemployed in China but 20 million of 1.4 billion is still just over 1%. It would be a huge number next to America's population but China's population is almost 5 times bigger I think a writedown of 20% off the top of all debt owed worldwide and then a new set of lending standards in order to prevent those people from ratcheting things back up would work. If it doesn’t then another 20%. At some point people will become economically viable again

Also, he talks about 20 million unemployed in China but 20 million of 1.4 billion is still just over 1%. It would be a huge number next to America’s population but China’s population is almost 5 times bigger

]]> By: ashpelham http://www.ritholtz.com/blog/2009/02/time-for-a-reality-check/comment-page-1/#comment-146073 ashpelham Mon, 16 Feb 2009 16:00:27 +0000 http://www.ritholtz.com/blog/?p=19090#comment-146073 I am actually in favor of cancelling debt. There simply will never be a time in the next 25 years in which we will see a "recovery" of home prices back to their elevated early-2006 levels. By that time, many mortgages will have been paid or won't have been paid, and it will be an afterthought anyway. I would actually presume that continuing declining home values will make many more people stop paying mortgages, and the banks will have no other recourse than to write-down the debts to make the mortgage more affordable. Perhaps some kind of annually adjusting sliding scale mortgage workout? In other words, an annual survey of home sales that is used for property tax assessments, then used for giving a "mortgage payment" for that year for the property? I am actually in favor of cancelling debt. There simply will never be a time in the next 25 years in which we will see a “recovery” of home prices back to their elevated early-2006 levels. By that time, many mortgages will have been paid or won’t have been paid, and it will be an afterthought anyway. I would actually presume that continuing declining home values will make many more people stop paying mortgages, and the banks will have no other recourse than to write-down the debts to make the mortgage more affordable. Perhaps some kind of annually adjusting sliding scale mortgage workout? In other words, an annual survey of home sales that is used for property tax assessments, then used for giving a “mortgage payment” for that year for the property?

]]> By: Steve Barry http://www.ritholtz.com/blog/2009/02/time-for-a-reality-check/comment-page-1/#comment-146068 Steve Barry Mon, 16 Feb 2009 15:49:52 +0000 http://www.ritholtz.com/blog/?p=19090#comment-146068 "It is not an experiment that is going to be fun to live through; but when we have the next debt deflation in 70 years or so, our grandchildren may know what to do." Quite possibly the odds of finding the right thing to do are infinitessimal. What is the right thing for Wyle E. Coyote to do when he sees a cliff coming down? Open an umbrella? The best way to solve the next debt deflation is to prevent it by preventing the next bubble. Is that possible, or does human nature guarantee the next one in 70 years? “It is not an experiment that is going to be fun to live through; but when we have the next debt deflation in 70 years or so,
our grandchildren may know what to do.”

Quite possibly the odds of finding the right thing to do are infinitessimal. What is the right thing for Wyle E. Coyote to do when he sees a cliff coming down? Open an umbrella? The best way to solve the next debt deflation is to prevent it by preventing the next bubble. Is that possible, or does human nature guarantee the next one in 70 years?

]]> By: How the Common Man Sees It http://www.ritholtz.com/blog/2009/02/time-for-a-reality-check/comment-page-1/#comment-146064 How the Common Man Sees It Mon, 16 Feb 2009 15:40:37 +0000 http://www.ritholtz.com/blog/?p=19090#comment-146064 I guess it is about time for the grownups to step up, take the toys away from the bankers....and start canceling debt I guess it is about time for the grownups to step up, take the toys away from the bankers….and start canceling debt

]]> By: ironman http://www.ritholtz.com/blog/2009/02/time-for-a-reality-check/comment-page-1/#comment-145989 ironman Sun, 15 Feb 2009 14:26:50 +0000 http://www.ritholtz.com/blog/?p=19090#comment-145989 The deceleration of China's economy, as measured by the decline in the growth rate of what it imports from the U.S., is <a href="http://politicalcalculations.blogspot.com/2009/01/china-in-recession.html" rel="nofollow">simply stunning</a>. Although it had been decelerating since 2006, the steepening slope of that decline in recent months is remarkable - I'm afraid that a rapid turnaround there, even if the government sharply increased its "stimulus" spending, is not likely. The deceleration of China’s economy, as measured by the decline in the growth rate of what it imports from the U.S., is simply stunning. Although it had been decelerating since 2006, the steepening slope of that decline in recent months is remarkable – I’m afraid that a rapid turnaround there, even if the government sharply increased its “stimulus” spending, is not likely.

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