Thursday, March 12, 2009

Why so doomy Mr. Gloomy?

You know - an amazing thing happens when banks provide loans. They make money! Funny how that works. Of course banks say all sorts of things. So we are all cautious to believe them.

So when I saw this report last night (which I'm unable to imbed) but you should watch - backs up some of the stuff banks are claiming. It isn't only that houses are now starting to move. They are getting an unheard of amount of offers and houses are going for over asking. While housing prices were too expensive - the lack of loans created an artificial overreaction in price.

I've learned a lot about human behaviour over this housing mess. When people think they'll get something for cheaper - they wait. When they think they can't - they get off their asses and buy things.

Sure - the whole thing is probably a head fake. But, the story is interesting in how many offers houses are getting, and that 99% of the buyers are credit worthy qualified buyers.

From Yahoo News.

"BOSTON (Reuters) – Bank of America Corp (BAC.N) Chief Executive Kenneth Lewis said on Thursday the largest U.S. bank was profitable in January and February and said it should be able to ride out the recession without new help from the nation's taxpayers.

Lewis joined Citigroup Inc's (C.N) Vikram Pandit and JPMorgan Chase & Co's (JPM.N) Jamie Dimon among chief executives to say their banks were in the black this year.

He also said Bank of America will make money for all of 2009, after reporting the bank's first quarterly loss in 17 years for the October-to-December period."

1 comment:

  1. I was watching a report on the Minneapolis Star-Trib's site. The reporter said he had good news and bad news on houses in the Twin Cities (or maybe all Minne.). The good news is that house offers and closing were up, way up. The bad news was that the house prices were down. He made NO connection between the two.


    What was the old story? "Jails are full, we can't figure out why robberies and murders are down."