First Houses, Now Gold? What’s the best way to make an asset class appreciate? A. Increase its intrinsic value B. Limit supply C. Increase its liquidity D. Stimulate demand Answer: C. (credit also given for “D.”). Buried in a Wall Street Journal article last week (the good stuff always is) was this nugget: Whenever an asset gets...Read More
National Moratorium on ForeclosuresSurprise, Surprise . . . the same banking behemoths that recklessly originated trillions in dubious mortgages — fuel for Wall Street’s securitization juggernaut — are apparently now running roughshod over the rights of delinquent borrowers as they seek to foreclose on their homes. How big a problem is this? And who’s going...Read More
A 30 Year Overview of Commercial Real Estate Did you know that bubbles can have progeny? That’s John Carney’s take, in his treatise-length (but extremely worthwhile) post, “How A Government Bailout Created Today’s Commercial Real Estate Catastrophe” (Clusterstock; 11/16/2009). According to Carney, today’s commercial real estate bubble is actually a “grandchild” bubble; the “grandparent” was...Read More
Less Trust = Simpler Financial System “The more complex the transaction, the more trust is needed to sustain the transaction.” –Robert Shiller, “Animal Spirits Depend on Trust“; The Wall Street Journal (1/27/2009) Robert Shiller, the Yale economist who made his name calling the 2000 Stock Market Bubble, has an excellent piece in Tuesday’s Wall Street...Read More
Pursuing a Short Sale? Better Be Patient One of the reasons that a “short sale” can be so protracted is all the decision makers involved. For those who aren’t familiar, a short sale is when a listed home is worth less than the mortgage against it. Rather than foreclose, the lender can often do better,...Read More