Saturday, October 20, 2007

Holy Shucking Fit! Vol. 2

(Click on pic to see her vibrate like a banged gong.)

I don't want to be alarmist. But I'll admit, it's getting to be a habit.

You may have heard that the price of a barrel of crude oil went over $90 for a hot minute on Thursday, but then fell to a "mere" $88.50 by Friday, finishing lower for the first time in the week. As I understand it, these are the prices for six month contracts. The gas we use right now was made from crude oil that sold at about $65 a barrel. The rule of thumb is a gallon of gas will cost about 1/20 of the price of a barrel of crude. We could easily be looking at $4.50 a gallon for gas by the spring in the U.S. Also, it's fair to say that oil is to industrialized economies what water is to living organisms. This will have an effect on the worldwide economy, not just on Americans.

Then there's news on a more local level. This story on the SF Gate website (home on the internet of the San Francisco Chronicle) from Friday gives the September sales numbers for existing homes. This was the worst September in 20 years.

How long have they been keeping this statistic? 20 years. Imagine that.

The drop is a 44.8% decrease from this time last year. It's a 34% decrease from August. The big problem is that "jumbo loans" are drying up. A jumbo loan is any loan over $417,000.

The median price of a home that sold is $670,000. This means you get a jumbo loan or you put down a BOATLOAD OF CASH.

The housing market in the San Francisco Bay Area has been nuts for at least 20 years. There needed to be a correction. I don't have the data for the rest of the country, but even taking all that into account...

Holy Shucking Fit!

Anyone who tells you the economy is strong when you kind of feel like it's getting tougher to get by causes the famous old problem first stated by Groucho Marx: "Who are you going to believe? Me or your lying eyes?"

Your eyes aren't lying. The economy is in trouble and headed for more.

Now playing: Chris Isaak - Things Go Wrong
via FoxyTunes


Distributorcap said...

The economy is in trouble and headed for more.

no shit......this is not good.....

only does it all crash before or after Jan 20 2009 so gwb can blame the next one

Matty Boy said...

Numbers are being fudged on a massive scale. The lie that has been around longest is "the core inflation rate". Core inflation doesn't measure energy prices or food, so it doesn't have anything to do with how any person or even any business is effected by price changes.

It was instituted to screw government pensioners. That was during the administration of Saint Ronald Reagan.

Karla said...

Yeah - Saint Reagan. I've been astounded to see that old sidekick to a chimp being lionized - even on NPR - as the great communicator. I'm not capitalizing that phrase, because it's so wrong it doesn't deserve big letters.

WTF about Reagan - and candidates trying to clothe themselves in his mantle? He was impossible to watch or listen to - he made no sense at all!

Do you remember Oliver Sacks writing about the aphasics at his hospital who lost language but could still understand subtext? Every time Reagan would come on the TV, the aphasics would gather around and hoot and howl at how funny he was.

I'm with the aphasics on this one.

FranIAm said...

And my man Matty knows his numbers.

My shitty ass little broken down house is for sale. Even a year ago I would have gotten 400K. Right now I just need out and to eliminate some other debt beyond the mortage and if I walk away penniless and free, I am good.

But it is looking a little not so good.

We shall see.

Matty Boy said...

When it comes to housing markets, your mileage may vary, but the whole nation is seeing the mess left behind by subprime lending. For me, a renter so far and not building the nest egg necessary to become a homeowner, I wonder if rents will go up as the foreclosed have to find new places to live.

And, of course, we have the Republican solution for how to fix the bankruptcy crisis, which is to make bankruptcy a very unattractive option.

A lot of people are getting squeezed in a very nasty way. It's almost the 21st Century combination of debtor's prison meets indentured servitude.

dguzman said...

"the core inflation rate". Core inflation doesn't measure energy prices or food -- exactly what I was going to say. Proof positive that the CIR is complete bullshit and has no bearing on reality. I've been noticing the cost of groceries going higher and higher by the week.

The Kat and I are going to have to sell our home when she's done with the PhD--we can only hope that some sucker will want that "farm livin' is the life for me!" lifestyle of our little valley.