Tuesday, August 29, 2006

NAHB trying to strong-arm the FED???

With housing slumping dramatically, hopes for a soft landing in the sector could be evaporating. According to Goldman Sachs (GS ), housing inventories are at their highest levels in more than a decade. Just how worried are homebuilders? A few weeks ago, on the eve of the Federal Reserve Board's Aug. 8 Open Market Committee meeting, the National Association of Homebuilders sent letters to Fed Chief Ben Bernanke and each of the other members of the interest-rate-setting committee. The message: Official stats don't capture how badly housing is hurting, since those figures don't include canceled contracts, which doubled over the past year. The letter also argued that inflation is more benign than feared, because one measure, rising rents, is overweighted in the consumer price index. NAHB Chief Economist David Seiders says this is the first time since he joined the staff, in 1984, that the group has written such a letter to the Fed.Granted, such a move seems mild compared with the actions of the early 1980s, when, to protest double-digit interest rates, a desperate NAHB mailed lumber (two-by-fours, meant to symbolize unbuilt homes) to then Fed Chief Paul Volcker. And it's not known if the NAHB's recent letter influenced the bankers in the marble temple, who chose -- for the first time in two years -- not to raise rates at its August meeting. But, says Tom Schlesinger, director of the Financial Markets Center, a Fed watchdog group, the urgent communication is "certainly a symptom" of the current anxiety.By Catherine Yang


smoggiebakersfield said...

The Fed is doing whatever they can to save the housing market, from the CRASH that is happening as I type this.

The Fed cannot save the market,it's
to far gone already. I/O's are reseting, consumer confidence is the lowest in years. Hundreds of thousands of people across the nation, are already into forclosure and many are in pre-forclosure, Flippers and Speculators included.

I consider homebuilers the biggest speculators of them all.

Shit always runs downhill!

Gary Anderson said...

Seiders cannot stop this housing crash. I think the fed will raise one more time before the end of the year. And the powerful economies of China and India will cause commodities to continue to be highly valued. That will spill over into the inflation measures and the fed will crush inflation and pick up the pieces of the housing market later. Much later.

Rob Dawg said...

The Fed doesn't care about assets. They even say as much. They are scrambling with too few tools, too late, with too little leverage to "save" the banking system at this point. It's a near thing IMHO. The Fed even has a reason to puncture the pustule. They need to withdraw equity from the system even as they flood it through deficit spending.

Rob Dawg said...

BTW, is there a Crisp & Cole Perp Walk Pool I can get in on. Of all the pustule consequences this is the one event that I just cannot wait for.

Current odds:
Caught at the airport boarding his jet: 20%.
At the courthouse while trying to get the macLarren back from creditors: 30%.
Traffic stop with $800k in cash; 30%.
Mysterious fire insurance complications: 20%.

Bakersfield Bubble said...

I would guess the perp walk will be in the next year! I have numerous rumors I would love to spread, but...

I will say that there are so many people in this town who can't wait for that day. I have even heard some of his current agents bitching about the bodyguards and the jet and all of the other wasteful spending he does. When things were great this spending was ok, but with volumes down 40% these guy's (like all realtors in this town) are hurting.

Did you see my post - Flip or Flop - That is Mr. Crisp trying to flip a mansion, in this town, at this stage in the bubble!?!?!?

Rob Dawg said...

I want Crisp taken down for his crimes sure but more so that the event can be rubbed in the newspaper's face. Those fawning sychophants need a 2x4 of reality across the forehead.

Yeah I saw the flop post. The tip of the Ponzi scheme.

Anonymous said...

What do you expect when a cocky young guy rides the bubble?

Does that guy still have his McLaren Mercedes or did the leasing company take it back?

Bakersfield real estate mogul David Crisp, 26, who once loaded UPS trucks for a living, now drives a $560,000 Mercedes-Benz McLaren sports car.


Did he get fried to a Crisp?

Anonymous said...

What crimes did Crisp commit?