Peridot Capitalist

For some reason I have not updated my long running home inventory chart in recent months, so I figured I would show the most recent data from the National Association of Realtors. As I have long discussed on this blog, inventories are the crucial part to the story because a balancing of longer term supply [...]

We have been hearing warnings for years. Just wait until China stops buying our debt… the borrow and spend cycle in the U.S. will come to a grinding halt. Since the Obama Administration has already spent about $1.4 trillion (~$800 billion on stimulus and ~$600 billion on a down payment for healthcare reform), these calls [...]

From the Associated Press this morning:

“Construction of new homes jumped in May by the largest amount in three months, an encouraging sign that the nation’s deep housing recession was beginning to bottom out. The Commerce Department said Tuesday that construction of new homes and apartments jumped 17.2 percent last month to a seasonally adjusted annual [...]

Call me a skeptic when it comes to getting really nervous about rising interest rates. “All of this debt we are selling is really having a severe impact on interest rates,” they say. It is true that interest rates on 10-year government bonds have doubled from 2% to 4% in recent months. However, not looking [...]

An interesting story of how even those who follow the financial system intimately on a daily basis can get pulled into the mess.
From the 5/14 edition of the New York Times: My Personal Credit Crisis by Edmund Andrews

Enjoy this post? Subscribe to the blog and never miss another one: Subscribe in a reader | Subscribe [...]

One of CNBC’s finest, David Faber, recently completed a two hour documentary about the housing bubble and the credit crisis. I had the chance to watch it on Sunday and it is very well done. For those of you who are interested in how the combination of mortgage brokers, Wall Street, and consumers led to [...]

Lots of people are already complaining about Obama’s housing plan unveiled yesterday based on the presumption that it is bailing out lenders and homeowners who made poor decisions at the expense of those who are paying their mortgages on time each month. Here are the details of the actual plan, which don’t seem as bad [...]

Updating our long-running chart of existing home inventories, we see a sharp drop in December. The chart below shows 2007 and 2008. You can see that monthly inventory drops in the past have been temporary, and not the beginning of a new trend. Hopefully this can change going forward.

In order for the economy, our financial [...]

It is going to be very difficult for the U.S. economy to turn a significant corner without a housing market that is at least stable. Amazingly, the housing situation has not improved much at all during 2008, even as builders halt new construction and slash prices on newly built inventory. Increases in foreclosures have completely negated [...]

Has anyone else noticed that whenever Treasury Secretary Henry Paulson speaks the market goes down? Today is no exception, as we learned that Paulson has abandoned the idea of using the TARP funds to buy bad assets from banks using a reverse auction process. When the idea of auctions first came to light I was [...]