Quick: Synonym for “Other-than-Temporary?” Want to get rid of something? Change — or obscure — its name. So, it’s no longer swine flu, it’s an acronym. In finance, all the toxic loans still on too-big-to-fail bank balance sheets are not “toxic loans” — suddenly, they’re “legacy assets.” And how are those to be valued? According...Read More
Key Factors Now: Job Losses, Historical Precedent When it comes to predicting housing prices, I’m officially agnostic: in the short run, I have no idea what they’re going to do (and neither does anyone else). In the long run, I’m on record forecasting that they’ll be higher: historically, at least, that’s been a very safe...Read More
“Home Prices May Fall Further”–generic headline discussing the housing market Whenever I see a “non-headline” headline like this, it reminds me of a colleague’s comment about an ad for income property a few years ago. Along with the property’s asking price, key stat’s, etc. was this language: ‘rents could be higher.’ To which my colleague...Read More
Renting vs. Owning: Not-So-Perfect Substitutes Every article I’ve seen in the last few years trying to divine the direction of housing prices inevitably compares renting to owning. The underlying assumption: when the cost of home ownership is more expensive relative to renting, housing is (still) too expensive. By contrast, when owning a home is cheaper...Read More
