[IWE] For homeowners, Econ types or not

[Bill Patient]

Home investment implies time in multiples of years. My home investment is
still pretty darned good...even considering its been 15 years in the making.
It has certainly kept pace with inflation (and more). And I've lost...my
guess...15% of value in the past 6 months.

Of course, the investment did carry the cost of capital over those years
(being interest)...but to rent would have incurred the same level of expense
with 0 return.

I must preface, I do not live in Sil Valley or Orange Co...where home
valuations are beyond reality and purely demand based...and thus more likely
to wildly fluctuate with the market.

Which is why, when asked to apply for a position at the big G...I declined.
Too expensive, too uncertain from the living perspective. If I was a younger
man with less baggage....maybe.

-----Original Message-----
From: iwe-admin@warhead.org.uk [mailto:iwe-admin@warhead.org.uk]On
Behalf Of Ashton Brown
Sent: Thursday, February 22, 2007 4:31 AM
To: iwe@warhead.org.uk
Subject: [IWE] For homeowners, Econ types or not


For those Noticing the precariousness of their own home investment, the
impossibility today of deciphering any trend-lines remotely of the sort
which had anchored such transactions.. since about 1850? -- those
vaguely aware of such cute now toys as "Synthetic CDO's" (and the
jackals who spawn, milk then liquidate such sucker-bait) ... Salon
brings us:

"The Mortgage Bomb"

http://www.salon.com/tech/htww/2007/02/20/cdo/index.html?source=newsletter


And for the flavour of such skirmishes -

1) A letter linked at end of article (and about the article.. shades of
The Index of All the Books in the Library - listed within the Index.)

http://tinyurl.com/29n3el

2) Another letter, re. Gretchen Morgenson + yan fine Kunstler quote, within:

> Gretchen Morgenson
>
> Continues to be one of the principle reasons I pay the Times Select
> subscription:
>
> "Consider how torrid the issuance of these securities has been in
> recent years. In the last three years, for example, big banks and
> brokerage firms almost doubled the amount of residential loans they
> issued, going to $1.1 trillion last year from $586 billion in 2003.
> Many of these loans have been packaged into collateralized debt
> obligations and sold to pension funds, hedge funds, banks and
> insurance companies. For example, 81 percent of the $249 billion in
> collateralized debt obligation pools in 2005 consisted of residential
> mortgage products.'
>
> The scale is simply staggering. Now there are scary new instruments
> called 'Synthetic CDO's' and these should have 'systemic risk'
> flashing in giant pulsing letters.
>
> 'Finance has been trending away from economic reality since the Ronald
> Reagan era on an accelerating basis. By this I mean the role of
> finance no longer represents sets of mechanisms and institutions
> designed to raise legitimate capital for investment in legitimate
> productive activities. Finance is now an end in itself, essentially a
> racket.' - Jim Kunstler
>
> “The only function of economic forecasting is to make astrology look
> respectable.” - John Kenneth Galbraith


http://letters.salon.com/tech/htww/2007/02/20/cdo/view/index.html


(It seems that The Gipper's Greed-is-Good Repo mob + the modrin-MBA
fellow travellers out of that slime-mold Petri dish -- have finally
succeeded in creating 'instruments' of such unreality; have hatched
schemes of such transcendent obfuscation.. as to have successfully
rendered the word 'value' [Itself] ... fit to join 'innovation', on the
extinct species word list.)
ie.


'Be Careful out there'
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