From: "Bill Reid" 
Newsgroups: misc.invest.stocks misc.consumers.frugal-living misc.invest.real-estate
Subject: Re: Where did the 400 billion USD in subprime mortgage losses go
Date: Wed, 21 Nov 2007 08:12:58 GMT
Bytes: 4795


FrediFizzx  wrote in message
news:5qhn1sF106e2qU1@mid.individual.net...
> "Bill Reid"  wrote in message
> news:nKM0j.123036$kj1.50673@bgtnsc04-news.ops.worldnet.att.net...
> > FrediFizzx  wrote in message
> > news:5qhfkiFvj35pU1@mid.individual.net...
> >> "Rod Speed"  wrote in message
> >> news:5qgub4F103pskU1@mid.individual.net...
> >> > FrediFizzx  wrote:
> >>
> >> >> Good example.  The money is still out there.  The people that sold
> >> >> at
> >> >> the top have the money.
> >> >
> >> > No they dont when the whole market drops significantly due to the
> >> > large
> >> > oversupply of houses that are the result of mortgage defaults with
> >> > those
> >> > who should never have been given that mortgage in the first place.
> >>
> >> What the heck does that have to do with people that sold at the top?
> >> This totally answers the OP's original question as to where the money
> >> went.  It doesn't just vaporize.
> >
> > Oh, but it does, eventually.  Last time this question came
> > up, I mentioned my brother-in-law and sister kind of sold
> > at the top in one of the most expensive real-estate markets
> > and moved to the same size house in a much less expensive
> > market and pocketed the difference.  So THAT'S where the
> > money went...first.
> >
> > Then of course they bought a boat, and then they needed a
> > new giant truck to haul it around, so the boat dealer and the
> > truck dealer got it, and so on.  So everybody wound up getting
> > a little piece of it.
> >
> > But now THAT well is dry, so where is the NEXT $400billion
> > gonna come from?  I think my brother-in-law and sister and their
> > boat and truck dealers deserve an answer to that question...as do
> > we all, or at least those of us who are smart enough to even ask
> > the question (and answer it)...
>
>   I really thought that perhaps you were "smarter than a fifth
> grader". ;-)

Reminds of the joke about how smart you have to be to train
a dog...

> The money is still out there circulating, isn't it?

Might be getting a little limp and frayed at this point, but
even if it's ripped in half you can get a new bill from the bank
if you have the larger half...

> Your
> sister's family have some assets they didn't have before, don't they?

Yeah, a truck that lost 20% when they drove it off the lot, only an
idiot would ask about the boat's value, and a house that's depreciating
in value...

> The next $400 billion comes from working for it

BWHAHAHAHAHAHAHAHAHAHAHAHAHAHA!!!!

Thanks, my sinuses were a little clogged, that really hit the spot!

> and for time that passes
> to make real estate worth more.

You mean "inflation"?  Or a thousand years from now when it
is under water from global warming maybe it will be really valuable
as an exotic vacation destination time-share?

> Sure, real estate is kind of like a
> pyramid scheme but it has always been that way and will continue barring
> some major catastrophic event.

Like "deflation"?

What's really fun, as usual, is to go back and read the discussions
on this group concerning real estate a few years back, compared to
the constant drumbeat of bad news today.  As usual, only a VERY
few had it right, could somehow "magically" predict the future...how'd
dey do dat?

---
William Ernest Reid
Post count:  856