Oh dear, my bad

I was busy trying to increase real estate sales this morning and so missed the NAR’s paid liar economist Yun’s speech at the Milbrook Club this morning. Greenwich Time sent along a young reporter who, not surprisingly, heard nothing and asked nothing that would disturb the paper’s real estate advertisers. Everybody!: Everything is beautiful …


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22 responses to “Oh dear, my bad

  1. Inagua

    “in Greenwich, year-to-date home sales are up 2 percent from 2010, more than double from 2009.” Sounds like a stable market to me.

  2. Burning Madolf

    Every time i see that guy’s (Yun) BS printed somewhere I want to hit something.
    Any Realtor (I like to use this term now more than broker, or agent, or asshole, but I say it with a pompous accent, lot’s of emphasis on Reeaallltor) who would listen to his constant attempts to call a bottom should lose their license.
    I also scream at the tv whenever that blonde from the NAR comes on telling me about what a great investment real estate has been and always will be.
    But the real kicker is the NAR ad that comes on talking about $60k in the economy and 2 jobs for every house sold.
    What a bunch of tools.

  3. digler

    Inagua, we are in a momentary pause…………………..before the bottom drops out again. Prices have to fall at least to where they traded in ’97 (and will probably overshoot on the downside). More pain ahead. This has just been a little calm before the storm. No matter how painful it may be for some, It is so easy to see that this has to happen. It is better to be prepared than to blindly hope and pray for something that is not going to happen. Not to add insult to injury but did you see the article on wall street layoffs in today’s WSJ? This can’t bode well for local prices. You better hope and pray that the man behind the curtain keeps on printing!

  4. lolo

    This is surreal :
    Surreal journalism or economism :
    “Yun, chief economist at the National Association of Realtors, said that in Greenwich, year-to-date home sales are up 2 percent from 2010, more than double from 2009.”
    So the % has more than doubled (from paltry 1 pc to paltry 2pc) but it is written like the number of sales has more than doubled. Besides, if the base is low, say 100, then the rate has doubled and one more house has
    been sold.
    “It’s not due to lack of demand. The reason new houses are not selling is because builders are not building,” Yun said. “This is a reflection of lack of supply rather than lack of demand.” Lack of ??? supply ????? of ??? houses ?????

    “A contributing factor to this dilemma is that builders haven’t been able to get construction loans because they don’t have government guarantees.”
    What dilemma ? what are the terms of that dilemma ? “a usually undesirable or unpleasant choice ” and now builders are entitled to govt guarantees ? on what basis ? nationalization of homebuilding industry ?

    Barbara Stephens, a realtor with Sotheby’s in Greenwich who attended the event. “If that’s the finger in the dyke, then why isn’t that happening? That’s something I’m going to look into.”
    What is the relevance of the metaphor “finger in the dyke” ? does she means : bottleneck ? and what is she going to look into ? Homebuilding national economics ? fingers ? levees ?

    “Both of these are optimistic signs, Yun said. ”
    SO this sentence is a positive. Why then does the next one start with an opposing “however” ?
    “However, the chief economist also predicted that prices could potentially increase and the country could run into a housing shortage in the next few years. ”
    So he predicted a potentiality ? I will today predict that the world could potentially end tomorrow or house prices in Greenwich could potentially raise or fall or stay the same.

    Next time I suggest the paper just publishes the NAR usual press release.

  5. Cobra

    I want some of what Yun is smokin’.

  6. vitabrevis

    ….and there was a unicorn seen grazing on the BHC lawn during Yun’s presentation!

  7. Inagua

    Digler – You may be right. This may be a temporary pause before another price decline. But a pause that lasts for a year on steady volume can also be consistent with longer term stabilization. My Greenwich thesis is simple — that there are always people willing and able to pay a premium for homes in a very few select communities. Layoffs generally do not have much of an impact on this type of buyer.

    Also, if you are right and prices are going to 1997 levels, then the American Dream is lost to an entire generation. I simply do not think the economy is goimg to collapse to that extent, but I admit that I may be wrong.

  8. Anonymous

    That GT reporter probably didn’t look at the front page of today’s (Thursday’s) New York Times where the story called “In Connecticut, Affluent Image, But Fiscal Pain” reminds us that our beautiful state has come in dead last in creating new jobs. And our bond rating went from stable to negative. But as you said, the Greenwich Time likes to keep advertisers happy, and readers entertained.

  9. Inagua

    Chris – I have been right so far with respect to Greenwich real estate, and my macro economic thesis is equally simple — that poor policies under Clinton, Bush and Obama have injured, but not seriously threatened the private sector. This wave of damage is over, and the economy has stabilized at its current weak level. We have seen our future, and it is the Euopean welfare state. America will have lower growth, a lower standard of living, higher unemployment, and higher inflation in the next 25 years than we had in the past 25 years. But there will always be enough successul private sector achievers and an increasing number of rent-seekers like Al Gore who can afford to pay a premium for Greenwich. Did you notice that it was a Greek bidder who just paid a record price at an art auction?

  10. Finger in the Dyke?

    . . . said Barbara Stephens, a realtor with Sotheby’s in Greenwich who attended the event. “If that’s the finger in the dyke, then why isn’t that happening? That’s something I’m going to look into.”

    I hope Stephens realizes what she’s getting herself into — or is it just a slip of the tongue . . . I mean pen . . . I mean finger . . . by that young Greenwich Time reporter, Olivia Just?

  11. Retired IB'er


    Unfortunately your basic macro economic thesis is flawed IMHO because you leave out the damage (in the form of over leverage to both public and private sector balance sheets) inflicted on America by the policies of Greenspan and Bernanke.

    The damage of goosing growth through ever increasing amounts of debt is what is killing the economy much more so then the policies of Clinton, Bush and Obama. Though I will admit that the repeal of Glass Steagal runs a close second.

  12. Olivia? Babar Stephens?

    1. Dike, not Dyke…. The story is about a Dutch boy who saves his country by putting his finger in a leaking dike. The boy stays there all night, in spite of the cold, until the adults of the village find him and make the necessary repairs. A small effort that averts a major disaster.

    2. But what did Barbara mean that then…?

    • I met and made friends with a marvelous Dutch composer when I was in Italy two years ago and she insisted that the story of the Dutch Boy is completely unknown in Holland. Completely! Apparently, its’s a story invented by outlanders. Too bad.- it should be true.

  13. digler

    I agree with retired IB’er. It is all about leverage. It is leverage that elevated these housing prices and the absence of that that will cause them to lose more value. Wages and home prices always moved in tandem (until they did not) and buyer’s were using debt in a variety of ways to make up for what they were not taking home in real wages. That game is over. A rising tide lifts all boats but an ebb tide takes them all lower. Greenwich will always trade at a premium but it does not exist in a bubble and if the national averages go much lower then Greenwich will go lower too. The 2% is dependent on the other 98% in many ways. We are all in this together.

  14. ajnock

    Yun is a dope. A well paid dope and shameless pumping shill. It must pain you to be required to pay dues that in part support the drivel he continually spews.

  15. Inagua

    RIB – You are of course correct about the critical role of the Fed. I had subsumed the Fed policies into Administration policies as a shorthand, but perhaps I should have been more specific. I entirely agree with you about repeal of Glass-Steagal. It was by far the worst thing Clinton ever did, and we all paid a huge price for it.

    I am not worried about excessive debt because it is largely limited to government and unsophticated marginal consumers. Most business have low debt and are in fact pretty liquid.

  16. digler

    Inagua,unsophisticated marginal consumers make up the bulk of the nation and the bulk of the home buyers. They buy homes, not businesses with low debt, which is why you should be worried about them if you want to see housing prices stabilize.

  17. Inagua

    Digler – I don’t expect housing prices nationally to stabilize. I expect them to contnue to go down. I say only that a very few select communities, including Greenwich, stabilized about a year ago after dropping by about a third from the high. And I expect those very few communities to have slightly increasing volume and prices for the next few years.

    I don’t think there is any possibiity of a robust national economy for at least ten years. And it is almost a certainty that inflation will become a significant problem with four to seven years.

  18. digler

    Inagua, you expect prices nationally to go down but to stabilize in Greenwich (and select communities). This does not make any sense at all. You seem like a very smart person. Why you seem to think that some land and/or homes are immune from this and not part of a total market? You may want to brush up on your Ricardo. Also, you still have not addressed what a significant amount of wall street lay offs (and the multiplier effect that goes hand in hand with that) will do to “select” community home prices. How is that not going to put downward pressure on the market even if it has stabilized. My point (is not to argue with you) it is that nothing has been accomplished (other than postponing the real day of reckoning) by kicking the can down the road and that prices will revert to the historical mean.

  19. Inagua

    “Inagua, you expect prices nationally to go down but to stabilize in Greenwich (and select communities). This does not make any sense at all.”

    Digler – Prices in Greenwich bottomed out last summer, stabilized for about six months, and have increased slightly since then. That fact may or may signify anything. Since I called a Greenwich bottom last summer and predicted stability going forward, I obviously am partial to the interpretation that a bottom was reached, and that a very modest price recovery has begun, despite the adverse national trend.

    You say that prices will revert to the historical mean, and I agree with you. Here is a Greenwich median price chart from Tulia which suggests that Greenwich is back on the historical mean. If you have better data, I would love to see it.