Sy,

Certainly it is possible but I would doubt he would be purposely deceptive in an article published on the WSJ OPINION page! In any case, it is his argument that is important, more than this personal position. But each can interpret the article however they want.

Ray 

"I would doubt he would be purposely deceptive in an article published on the WSJ OPINION page! "

Why not when there's millions to be gained through deception? Even the presidential candidates make deceptive statements in public.

Sy

True but they are politicians! Everyone expects them to tel one set of lies to one audience and another to a second and around and around it goes!

Ray 

A person doesn't have to be deceptive to be wrong.

Traxis partners may have made a bet.  It's an opinion piece, not a compelling analysis.  I'd  love to see if Traxis has walked its talk, but funds like Traxis are anything but transparent.

On the other hand, the S & P Case-Shiller Index or Realtytrac, which are entirely transparent and use real-time numbers, offer a far more different picture than the Opinion piece.

Just in case anyone has forgotten, foreclosure rates are up, banks are not lending even to many creditworthy customers, and now home equity loans are being called in even for creditworthy clients.  Worse yet, the credit crisis has spread to auto loans and student loans.

It's a crisis and it ain't over.  Bob U. 

He was interviewed on CNBC this morning with two of the female CNBC staff both of whom are astute. The criticism one made is he ignored the problem with obtaining a mortgage. His response was that the issue was what the 90% of people with performing mortgages would do in the near future. They have good credit and can get mortgages and they can now buy homes at relatively cheap prices in affordability terms, which is certainly true. He based this argument in turn on the early signs of a recovery in sale of new homes and forecast this would spread to existing home resales.

I would not be so sure in arguing he is wrong. And ee shall see. It is brash prediction but I like his logic.

Ray 

If the gentleman is talking about folks with cash, then I quite agree that opportunities abound.

However, we live in a time where lots of folks have mistaken good credit for immediate liquidity (i.e., cash).

Everything I've read, Ray, indicates that banks or lenders in general are demanding more cash up front and lots of folks with good credit don't have the cash.  That's the issue.

This is a point so many people missed while the residential housing market was flying: a house is not a liquid asset, all the more so for those who did cash-out refis, many of whom are now upside down (house worth less than loan amount).  Bob U.

All I know is what I read and what I heard. He was talking of the 90% of home owners with performing mortgages and who he argued had good credit. Presumably they also have solid equity in their home. Some would undoubtedly have cash. Don't know any more. Again, it is the logic that appeals to me. He could be right; he certainly is right about most people having performing mortgages.

Ray 

Hi Ray,

Here's Fannie Mae's view of the housing market hot off the press.  http://biz.yahoo.com/ap/080506/economy.html     Bob U. 

I just sold a piece of property, so this is a first-hand observation. Trying to get a mortgage right now is very difficult. Yes, the credit has been tightened up substantially. You have to have a high credit score (or equivalent if utilizing manual underwriting in lieu of a credit score) to be able to purchase a piece of property or have all cash. Most buyers now have, at best, only a 5% down payment, whereas 20% is the normally recommended amount. So, buyers are not saving the appropriate down payment, plus credit is tight. Add these two points together, and you get the popping of the real estate bubble, which is now spreading to other credit markets like auto loans, student loans, and credit cards (Bob U is correct.). Not to mention the US average of zero savings rate. We're still getting conflicting information in the media, so you just have to pick one or the other opinion as to whether the housing crisis is over or not.

Dan

P.S. - I hope no one minds this Boglehead posting here in a very interesting discussion. ;)