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| User Info | The Home Price Valuation Mess And The Dollar in forum [Ticker] | |||
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Genesis Posts: 71433 Incept: 2007-06-26 
KD^2 
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http://market-ticker.denninger.net/2008/....
---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-03-06 17:04:22
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Prometheus Posts: 30 Incept: 2008-02-26 
Online
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Today is Thursday March 6 not the 5th.
2008-03-06 17:17:49
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Uncleoxidant Posts: 1704 Incept: 2007-07-10 Stumptown
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Interesting idea about the county being obligated to buy homes at assessed value. But what would obligate countys to do this? Also, there must be a few thousand countys in the US. How would you get them all to do this? ---------- I am NOT a consumer, I am a Citizen!
2008-03-06 17:21:36
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Genesis Posts: 71433 Incept: 2007-06-26
KD^2
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You're right Pro - I wrote part of it last night. I'll go fix that. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-03-06 17:29:11
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Av8rphil Posts: 1817 Incept: 2007-06-26
Platte City, MO
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Karl, When house prices are dropping the county would undoubtedly have a provision that would let them revalue the home before being required to purchase it. But if the bank held the property they have 2 options: 1. Ask the county to revalue the property and if more than what they think they can get in the open market, they put it to the county - not likely as the county will low ball value and the bank gets stuck with lower value on its books. 2. Not do anything and retain higher value on its books as it knows #1 won't work. The county has no interest to drop the value without a request as that would drop their revenues. So what makes the bank have a realistic value on their books? ---------- "Two things in life are infinite: the universe and human stupidity; and i'm not sure about the universe" -Einstein
2008-03-06 18:02:29
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Genesis Posts: 71433 Incept: 2007-06-26
KD^2
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The county squicks the bank if they try that as the tax value is based off their appraisal! ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-03-06 18:06:50
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Av8rphil Posts: 1817 Incept: 2007-06-26
Platte City, MO
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I would think the bank would be more inclined to pay a higher tax than write down assets. Of course you could have a provision of mandatory revaluation by the county on all foreclosures. That should work I think. ---------- "Two things in life are infinite: the universe and human stupidity; and i'm not sure about the universe" -Einstein
2008-03-06 18:15:57
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Genesis Posts: 71433 Incept: 2007-06-26
KD^2
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Actually, its kinda simple - mandatory revaluation on all transfers. There goes that problem; they already do this in most places (they sure do here!) ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-03-06 18:17:25
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Av8rphil Posts: 1817 Incept: 2007-06-26
Platte City, MO
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Quote:That is more than 1 in 20 of ALL mortgages delinquent; this is no longer a "subprime" problem, it has not infested THE ENTIRE HOUSING STOCK. "not"? ---------- "Two things in life are infinite: the universe and human stupidity; and i'm not sure about the universe" -Einstein
2008-03-06 18:18:20
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Gitm Posts: 189 Incept: 2007-06-26
Colorado
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Assessments are already way below actual value (at least in my county). For instance, there is a house recently sold for $575,000 but it is assessed at $45,760. If you are a smart county you would cut the assessed value in half and double your tax rate. Same revenue, no risk of a put.
2008-03-06 18:25:34
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Sandor Posts: 1002 Incept: 2007-08-08
Deltaville,Virginia Online
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Ok. So it IS Photoguy bad!
2008-03-06 18:27:27
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Cobra2411 Posts: 6153 Incept: 2007-06-26
Dark Side of the Moon
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Hold up a second... You need to understand how property taxes work. First, they are super liens, so they go in front of any mortgages, liens, judgments, etc. regardless of when those liens were created. There are two basic types of tax sales. Tax deeds and tax certificates. In a tax deed state, you buy the house, free and clear of all mortgages and encumberences. Typically the first mortgage holder will either bid an upset amount or pay the taxes and then go after the homeowner. In a tax cert state you buy a tax coupon and bid the interest rate. You then have the right to foreclose after a set amount of time. Some states just give you the deed without a foreclosure. This is generic info and there may be a couple tax cert states that give you the deed without wiping the title, but in most states the mortgage gets wiped out at a tax sale. So there really isn't any reason for them to assess low in fear of owning the property, they will get paid by the lender, the homeowner or the person buying at tax sale... Oh and the amount of the sale is the past due taxes, not the assessed value... ---------- Suppose you were a criminal, and suppose you were a member of Congress; but I repeat myself... Last modified:
2008-03-06 19:04:39 by cobra2411
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Nightowl Posts: 2279 Incept: 2007-06-26
On a 45 for 18
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Great ticker Karl. Thanks for all the work you've done, did and will do! One can only hope more elected officials are reading it.
2008-03-06 19:01:37
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Bozonian Posts: 14033 Incept: 2007-09-01
PFT - Pure F'n Tin
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The written tickers are available to the general public right? I can send a link to someone and they'll be able to read it? ---------- I'm so depressed about outsourcing I called the suicide hotline and got a call center in Pakistan. They got all excited and asked me if I could drive a truck. Everything I write is my opinion and not to be considered proven fact. Nothing I write should be considered financial advice.
2008-03-06 19:08:49
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Cobra2411 Posts: 6153 Incept: 2007-06-26
Dark Side of the Moon
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Yes ---------- Suppose you were a criminal, and suppose you were a member of Congress; but I repeat myself...
2008-03-06 19:12:46
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Bw8472 Posts: 6446 Incept: 2007-06-28 
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Kind of like standing on a damn and watching the water trickle through then poof, you're gone. This stuff isn't funny anymore, I can't believe Ben dosen't just come clean and get it over with, any attempt to paper it over more is only going to make it worse from here on out. We're going to see things no one thought we'd ever see again like Dow 5k or lower IMO, not right away but that might be optimistic before this is all over if they don't simply start valuing the truth. ---------- At what point then is the approach of danger to be expected? I answer, if it ever reach us, it must spring up amongst us. It cannot come from abroad. If destruction be our lot, we must ourselves be its author and finisher. As a nation of freemen, we must live through all time, or die by suicide. ~Abraham Lincoln
2008-03-06 19:35:12
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Bubblesee Posts: 3768 Incept: 2007-06-27
nyc
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I think Ben WANTS to mark to market and get this mess over with but the situation is so big that they perceive M2M as too collossal an option to consider..........and THATS why they are all so friggin scared! ( i sure hope i'm wrong on this - LOL! ) BTW - Is the Carlysle Group (mentioned in KD's ticker) the MEGA Company that has members of the Bush family as well as numerous Saudi's on their board??? ---------- Ticker Forum Special: "Bennie and the Feds" Melody:Elton John Lyrics:Bubblesee http://www.youtube.com/watch?v=etfVMtCq9Oc (Larry Kudblow eat your heart out) Last modified:
2008-03-06 19:46:29 by bubblesee
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Yahuw Posts: 342 Incept: 2008-01-17
Charlotte
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Bubblesee- Yes. It is. Which is even more amazing in itself. ---------- I have no signature!
2008-03-06 19:47:34
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Bubblesee Posts: 3768 Incept: 2007-06-27
nyc
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WOW!!! Never thought i'd see the day when THOSE guys got squicked!!! Looks like more than just their Karma is circling the toilet bowl........... ---------- Ticker Forum Special: "Bennie and the Feds" Melody:Elton John Lyrics:Bubblesee http://www.youtube.com/watch?v=etfVMtCq9Oc (Larry Kudblow eat your heart out) Last modified:
2008-03-06 19:52:43 by bubblesee
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Mtgspy Posts: 6122 Incept: 2007-10-27
Online
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I think the jawboning is a bluff that has been obviously called. I dont always wholeheartedly agree to the chieftain here, but keep "threatening" rate cut and the impact would be none of us gonna be able to buy food - not a funny situation anymore. Time to fix the investing trust directly while there is still a shred of credibility. Dude, I have seen that housing "put" option in an article before 
---------- It sounds antiquated, merchantilistic - until you figured out that I was hoarding for war. Last modified:
2008-03-06 22:02:30 by mtgspy
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Perplexd Posts: 144 Incept: 2007-06-26 Seattle
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The housing put option? Worst idea ever. Would this have stopped the housing mess from blowing up? Only if local government recognized the bubble better than my real estate agent did. And they so ****ing didn't. People think market solutions are so damn magical. This just moves risk around becuase people don't want to pay high taxes (but they wanted the house appreciation!). I see zero benefit from this idea. Ultimately, this just puts counties in the derivatives game. Is that a good idea? Maybe we can cut the crappy tax assessments up into tranches, too? That seems to work well. Also disagree about the 70's. The spending on the Great Society and the "police Action" in Vietnam played a meaningful role. We're doing the same things now with social programs and our ongoing wars of attrition. Quote:We either restore trust right here and now or our capital markets - and our economy - are toast. The alternative is we lose control of global energy flows and face a political revolution at home on some level. It might be better to pull that trigger, but as always, a gaggle of people in power will stand around and say "no, YOU pull it" to one another. It doesn't tend to get pulled and someone finally starts looking for a scapegoat. I'm tellin' ya. No cops will show till the horses are out of the barn and RTC 2 is already in the saddle. ---------- “Of all the contrivances for cheating the laboring classes of mankind, none has been more effective than that which deludes them with paper money.” - Daniel Webster
2008-03-06 21:50:23
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Boz_inc Posts: 274 Incept: 2008-01-20
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Quote:That is more than 1 in 20 of ALL mortgages delinquent; this is no longer a "subprime" problem, it has now infested THE ENTIRE HOUSING STOCK.
2008-03-06 21:59:51
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Murf Posts: 2814 Incept: 2007-08-28
the surf
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Bravo! So many of the tickers lately are true "out of the park homeruns". I wish all thinking Americans would read them. Keep up the outstanding work, Karl.
---------- The recovery up is losing steam
2008-03-06 22:17:54
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Late_to_the_party Posts: 457 Incept: 2007-08-14
Nor Cal
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Quote:This morning the IRX is trading at 13.05, or 1.3%. With the FFT at 3% this is clearly in "emergency rate cut" territory but should Ben do this it will simply roach the dollar further, which will drive even more people into Treasuries and push the IRX down more, while ramping import costs even more quickly! Would further roaching the USD really drive people into Treasuries, or would it trigger capital flight? Earning 1.3% on T-Bills ain't that appealing if the DX is on a rocket sled ride to 60. ---------- -The toughest part of being principled is when it means you must support NOT doing something that would personally benefit YOU. (KD) -A pig and his money are soon parted. Last modified:
2008-03-06 22:45:25 by late_to_the_party
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Genesis Posts: 71433 Incept: 2007-06-26
KD^2
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God help us if we trigger capital flight. Let's not go there. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2008-03-06 22:47:43
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