An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
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Wednesday, October 15, 2014
1937?
"Buy the dip" again, figuring on a Greenspan to Bernanke to Yellen put, or is this 1937, and the beginning of the second leg down with looming deflation?
I drive by vacant buildings all the time where you see a brand new building being put up right next to it....
Leasing a new construction is cheaper than leasing at the prices the banks with the forclosed properties have them listed at for leasing... if the banks with the vacant buildings drop the asking price, they THEN run afoul of the regulators as the pro forma at the new lower price doesnt equal what they are saying the BV of the property is...
so this will take a long time to work off for the banks but it stays off the liquidations a la the RTC in the early 90s....
No 1937 with TBTF nowadays. .
ReplyDeleteNo forced liquidations ... buildings sit vacant and repossessed vehicles sit on lots...
Those still remaining in the grace of flows created by now 4.2T of leading government spending buy a new construction house and a brand new car....
I drive by vacant buildings all the time where you see a brand new building being put up right next to it....
ReplyDeleteLeasing a new construction is cheaper than leasing at the prices the banks with the forclosed properties have them listed at for leasing... if the banks with the vacant buildings drop the asking price, they THEN run afoul of the regulators as the pro forma at the new lower price doesnt equal what they are saying the BV of the property is...
so this will take a long time to work off for the banks but it stays off the liquidations a la the RTC in the early 90s....