Financial News

[southsider2k5]

I find this silly. Trying to find an exact bottom is something generally not smart with any investment, real estate or otherwise.

 

Seems clear to me that some time in the 2009-2011 period will end up being a bottom for the market, that's what pretty much everyone is saying. I said that last year. Its going a little later than I would have guessed (I think I said late 2009 or early 2010 originally), but again, you should really shoot for general timeframes on this market, not high precision. If you wait too long, mortgage rates will start to go up (they HAVE to, because interest rates HAVE to go up somewhat soon, and inflation with it). If I were you, if you see youself buying somewhere in the next couple years, I'd start bargain hunting now (lots of foreclosures and distressed properties to choose from), and jump at something when it looks to you like the place you want.

 

I'm perfectly fine going in a little bit early, versus trying for perfection and getting socked with a bigger mortgage.

 

I'm sure you have heard the saying... People who pick bottoms get s*** on their fingers.

[NorthSideSox72]

http://www.reuters.com/assets/print?aid=USTRE67N55X20100824

I don't see how anyone can doubt that the Stim bill did indeed have a positive impact on overall employment. That, to me, isn't even the discussion to have. The things worth discussing are how effectively that money was used, what types of stimulus work and don't, whether or not to do another round, and if so, what that round would entail.

 

[Balta1701]

I don't see how anyone can doubt that the Stim bill did indeed have a positive impact on overall employment. That, to me, isn't even the discussion to have.

Then why do we hear it so regularly?

[NorthSideSox72]

I'm sure you have heard the saying... People who pick bottoms get s*** on their fingers.

That would be the short and sweet way of putting it, yeah.

 

Home values may still go down, maybe even a significant amount - but at worst, it will be a small percentage of what has already happened. And being a long term investment for most people (real estate), that smaller amount should be less of a concern than other issues (finding the right home at the right relative price, with the right mortgage, etc.) that will ultimately be more material.

 

[NorthSideSox72]

Then why do we hear it so regularly?

Because people on both sides rely so heavily on hyperbole to make their point. People see major flaws in the stim bill, and they see ballooning deficits - both very valid concerns - but then they start shouting and making blanket statements like "The stim bill was useless!" because they feel the need to shout.

 

[jasonxctf]

ELFA Leasing Index Shows Equipment Finance Sector Continues to Strengthen

Monday, August 23, 2010

 

The Equipment Leasing & Finance Association released its Monthly Leasing & Financing Index (MLFI) for the month of July, showing a 17% increase when compared to the same period in 2009.

 

Respondents said they financed $5.6 billion of new equipment in July, compared with $5.5 billion in May and $4.8 billion a year earlier. The July increase in originations was the strongest in two years.

 

"Financing demand appears to be picking up," said ELFA president William G. Sutton. "Our data mirrors recently reported government statistics showing the annual rate of overall business investment in equipment and software up nearly 22% in the second quarter. It appears we're heading in the right direction and our members remain cautiously optimistic that this trend will continue."

 

The July increase marked the fourth straight month of year-over-year growth in the financing survey, following 20 consecutive months of declines caused by the recession and reduced access to lending.

 

Credit quality is mixed. Receivables over 30 days increased marginally to 3.5%, up from 3.3% in the prior month, but improved when compared to the year-earlier period (3.9%). Charge-offs fell to 1.5% when compared to the previous month (1.8%) and the same period in the previous year (1.7%).

 

The number of credit approvals stabilized at 70% in July compared to the previous month, and improved compared to the same period the prior year (66%). Thirty-six percent of participating organizations reported submitting more transactions for approval during the month. Finally, total headcount for equipment finance companies remained relatively flat during the June-July period. Supplemental data shows that small business and construction lead the underperforming sectors.

 

"There have been some positive signs in the industry," said Crit DeMent, Chairman, CEO, LEAF Financial Corporation. "In addition to the recent encouraging trends in origination growth and portfolio performance, the asset back securitization market seems to be strengthening for equipment leasing. Several lessors have completed transactions in 2010, and investors have been very receptive to our asset class because of its relatively good performance. The latter half of the year promises to be even stronger as issuers and rating agencies become more comfortable operating under some of the new government regulations. The return of this critical source of capital is a vital component to the long-term success of many in our industry, especially among independents and captives."

 

[NorthSideSox72]

ELFA Leasing Index Shows Equipment Finance Sector Continues to Strengthen

Monday, August 23, 2010

 

The Equipment Leasing & Finance Association released its Monthly Leasing & Financing Index (MLFI) for the month of July, showing a 17% increase when compared to the same period in 2009.

 

Respondents said they financed $5.6 billion of new equipment in July, compared with $5.5 billion in May and $4.8 billion a year earlier. The July increase in originations was the strongest in two years.

 

"Financing demand appears to be picking up," said ELFA president William G. Sutton. "Our data mirrors recently reported government statistics showing the annual rate of overall business investment in equipment and software up nearly 22% in the second quarter. It appears we're heading in the right direction and our members remain cautiously optimistic that this trend will continue."

 

The July increase marked the fourth straight month of year-over-year growth in the financing survey, following 20 consecutive months of declines caused by the recession and reduced access to lending.

 

Credit quality is mixed. Receivables over 30 days increased marginally to 3.5%, up from 3.3% in the prior month, but improved when compared to the year-earlier period (3.9%). Charge-offs fell to 1.5% when compared to the previous month (1.8%) and the same period in the previous year (1.7%).

 

The number of credit approvals stabilized at 70% in July compared to the previous month, and improved compared to the same period the prior year (66%). Thirty-six percent of participating organizations reported submitting more transactions for approval during the month. Finally, total headcount for equipment finance companies remained relatively flat during the June-July period. Supplemental data shows that small business and construction lead the underperforming sectors.

 

"There have been some positive signs in the industry," said Crit DeMent, Chairman, CEO, LEAF Financial Corporation. "In addition to the recent encouraging trends in origination growth and portfolio performance, the asset back securitization market seems to be strengthening for equipment leasing. Several lessors have completed transactions in 2010, and investors have been very receptive to our asset class because of its relatively good performance. The latter half of the year promises to be even stronger as issuers and rating agencies become more comfortable operating under some of the new government regulations. The return of this critical source of capital is a vital component to the long-term success of many in our industry, especially among independents and captives."

I wonder if this is businesses realizing that rates on borrowing right now are about as cheap as they will ever see, and now is the time to jump on it, even if the recovery is slow and will take years.

 

[southsider2k5]

I wonder if this is businesses realizing that rates on borrowing right now are about as cheap as they will ever see, and now is the time to jump on it, even if the recovery is slow and will take years.

 

I think more likely is that this kind of stuff has been put off as long as possible, and for many it is getting to the point where it has to be done.

[NorthSideSox72]

I think more likely is that this kind of stuff has been put off as long as possible, and for many it is getting to the point where it has to be done.

Or some of both. Long term needs that have been put aside too long, and borrowing rates being so low.

 

[jasonxctf]

I think more likely is that this kind of stuff has been put off as long as possible, and for many it is getting to the point where it has to be done.

 

i'm in the industry and I can tell you that this is true. There is pent-up demand out there and at somepoint, it's going to have to move. It kind of reminds me a bit of the technology sales slowdown of 2003. You can only use that old PC for so long...

[Jenksismyhero]

I don't see how anyone can doubt that the Stim bill did indeed have a positive impact on overall employment. That, to me, isn't even the discussion to have. The things worth discussing are how effectively that money was used, what types of stimulus work and don't, whether or not to do another round, and if so, what that round would entail.

 

Really? Is that why unemployment claims keep rising?

 

http://www.cnbc.com/id/38768328/Weekly_Job...ump_Hit_500_000

 

The four-week average of new jobless claims, considered a better measure of underlying labor market trends as it irons out week-to-week volatility, rose 8,000 to 482,500, the highest since early December.

 

Claims for unemployment benefits have been stuck at lofty levels for much of this year, which many economists say points to unemployment staying uncomfortably high for some time.

 

Claims have not come close to the 400,000 level that most analysts generally view as the dividing line between payrolls growth and contraction. Payrolls grew in the first five months of this year, partly due to hiring for the decennial census, and have declined in both June and July.

[jasonxctf]

Really? Is that why unemployment claims keep rising?

 

http://www.cnbc.com/id/38768328/Weekly_Job...ump_Hit_500_000

 

those numbers are misleading and at the end of the day, not that important.

it doesn't tell you how many people were hired during those months. So while initial unemployment claims may go up, so might hiring.

[Jenksismyhero]

those numbers are misleading and at the end of the day, not that important.

it doesn't tell you how many people were hired during those months. So while initial unemployment claims may go up, so might hiring.

 

Ok fine, here's the unemployment numbers:

 

http://www.tradingeconomics.com/Economics/...aspx?Symbol=USD

 

 

[jasonxctf]

Ok fine, here's the unemployment numbers:

 

http://www.tradingeconomics.com/Economics/...aspx?Symbol=USD

 

and that's my exact point. The unemployment level has dropped by 0.6% in the past 9 months. It's not a ton, but it's nothing to disregard either.

 

I'm interested to see what happens between now and Dec. You've got students (Hs and college) who were working hours this summer as cheap labor at some businesses. (either full time or part time) If those positions are truly necessary, they will now need to be filled again.

[Jenksismyhero]

and that's my exact point. The unemployment level has dropped by 0.6% in the past 9 months. It's not a ton, but it's nothing to disregard either.

 

I'm interested to see what happens between now and Dec. You've got students (Hs and college) who were working hours this summer as cheap labor at some businesses. (either full time or part time) If those positions are truly necessary, they will now need to be filled again.

 

You don't think the X millions hired for the census messed up those numbers?

 

 

[NorthSideSox72]

Really? Is that why unemployment claims keep rising?

 

http://www.cnbc.com/id/38768328/Weekly_Job...ump_Hit_500_000

How do you not see that those two things can both be true? Yes, the Stim bill added jobs and GDP. Yes, UE claims keep rising. They are not mutually exclusive. The point being made is that jobs are still being lost, but at a lesser rate than they otherwise would be.

 

[Jenksismyhero]

How do you not see that those two things can both be true? Yes, the Stim bill added jobs and GDP. Yes, UE claims keep rising. They are not mutually exclusive. The point being made is that jobs are still being lost, but at a lesser rate than they otherwise would be.

 

it may have added jobs, but more or less the same number of people are unemployed from the time the stimulus bill was signed. I dunno how you can say the stimulus alone slowed the rate of job loss.

 

Either way, the real discussion is that even if you agree with the bolded above, the question becomes if the cost was worth it. Especially since people want even more stimulus.

Edited August 25, 2010 by Jenksismybitch

[jasonxctf]

You don't think the X millions hired for the census messed up those numbers?

 

800,000 people were hired as temp census workers. Each on average worked 19 hours a week for 6 weeks.

 

Also, as previously reported, in 1990 and 2000 the census workers hiring/firing had very little if not zero effect the BLS unemployment numbers.

[NorthSideSox72]

One of the oddities in the current recession... despite the increasing financial and employment pressures, credit card debt by consumers has hit an 8 year low.

 

[southsider2k5]

One of the oddities in the current recession... despite the increasing financial and employment pressures, credit card debt by consumers has hit an 8 year low.

 

I would be willing to bet that this is a function of banks drying up credit lines to save their lending ratios.

[NorthSideSox72]

I would be willing to bet that this is a function of banks drying up credit lines to save their lending ratios.

Could be, but it takes years to clear the flotsam you get from doing that, so that means they would have had to start doing that a while back.

 

Another theory is that people are simply looking at the insane rates they are paying on credit cards, and realizing that pretty much anything else is better than that.

 

[southsider2k5]

Could be, but it takes years to clear the flotsam you get from doing that, so that means they would have had to start doing that a while back.

 

Another theory is that people are simply looking at the insane rates they are paying on credit cards, and realizing that pretty much anything else is better than that.

 

The numbers I remember seem like about half of people saw their lines canceled or reduced in prior years. Now that we are about two years into this mess, it has been enough time to see balances start to get paid down to reach those lowered lines.

[Balta1701]

Another theory is that people are simply looking at the insane rates they are paying on credit cards, and realizing that pretty much anything else is better than that.

Another portion of that is that the remaining few people with good credit are able to refinance it downwards to lower rates right now.

[Balta1701]

it may have added jobs, but more or less the same number of people are unemployed from the time the stimulus bill was signed. I dunno how you can say the stimulus alone slowed the rate of job loss.

The question then is...why did job loss turn around basically in March 2009?

[Balta1701]

I'm sure you have heard the saying... People who pick bottoms get s*** on their fingers.

In hindsight, what actually amazes me about the last 8 years is how easy it was to call exactly what was going to happen. I mean, I didn't get the tiny details like which bank was going to fail, but in 2004 I was writing that whoever won the Presidential election was screwed in 2008 because there was a massive credit bubble out there, allowing for growth of consumer spending despite the fact that wages were stagnant. In 2003 I decided to rent instead of buy, because I thought California had a housing bubble. In 2005, I moved, but made the same decision. again.

 

About the only thing I think of as a mistake was not realizing how easy it would have been to pick out the peak of the housing bubble. If I'd anticipated that I could have cashed in on the bubble myself. My favorite "the peak is here" story was the "Buy a condo get a prius deal" showing up in more than a few places in California in early 2007...where condo-owners were using the free car as a way of keeping up the nominal sale price but giving the purchaser an extra incentive.