On April 10, 2007 I wrote Why are we having record foreclosures in Miami Dade County? Fraud or Incompetence? and August 7, 2007 I wrote Housing: Is there blood in the streets yet? I knew there was something very wrong as I continued to write about foreclosures. This blog has 54 entries under foreclosures. What I don’t understand is, why didn’t I listen to myself and Gimleteye? Why did I not have enough sense to get out of the stock market? I saw the writing on the wall with the housing market, I knew it was a house of cards ready to fall. I suppose I never thought it would fall this far.
Gimleteye wrote March 9th 2007:
“You are not alone trying to make sense of the mess in the housing markets and the vulnerability of the US financial system to wild excesses in debt creation during the latest, greatest housing boom in history.”
I can’t shake the feeling of guilt, I should have known better. Now, I have to watch every penny. What fun is that? This really sucks. Today, I am mad at myself.
Tell us your story!
6 comments:
Gimleteye writes:
My son asked me the very same question this morning. I think people are truly feeling shell-shock. And it's not over by a long shot.
The most difficult side of an investment is knowing when to sell. Investment psychology is a see-saw between greed and fear. How many investors, last summer, said to themselves, "Oh it's bad, I know. But is the market really going to go down more than 20 or 25 percent?" And then, you have brilliant investors like Warren Buffett jumping in and buying up everything in sight, from those levels: Berkshire Hathaway is down fifty percent!
Right now, the markets are gripped by fear. And not just in the US: everywhere. There is no sanctuary.
This is partly what makes this economic crisis different from anything we've experienced-- any of us. Although not without precedent.
It is true: Eyeonmiami was on this story a lot earlier than the mainstream media in Florida. That's not much consolation. And few got rich from the knowledge.
Most of knew that there was a housing bubble buiding. Markets in Florida, California and Las Vegas were building at an extraordinary rate. For several years people were flipping properties with average annualized returns of 10, 15% plus, while personal incomes were flat. Of course this was unsustainable. However, when the bubble burst few of us could imagine just how far reaching this downturn would go. The question is do we (our governments) interfere with the natural repricing and deleveraging of assets or do we let it run its course?
Brian Raymond Callahan
Miami, Florida
Yes, you knew there was a bubble. A few smart people shorted banks that invested in subprime and now they are laughing all the way to NOT THE BANK. Because securitized sprawl building was the cornerstone of our stupid socio-economic system, when it went down it took everything else down. Roubini understands that and a few others. Even though some are more culpable than others, everybody sinks in the same boat.
You have the greatest blog in South Florida and it should be required reading.
I ask myself the same question. I suppose I was foolish as well and caught up in the greed and emotion on a certain level even though I thought it was unsustainable.
DF
The dumbest thing is, I can't afford to worry about my IRA. I had to do a spend down on it, because of lack of employment, so I am praying that my current company stays solvent.
Now, I have discovered that my new roof is less water tight than the one I replaced. What roofer? He is gone in spite of checking him out before hiring him. That seems like a nightmare from Andrew, not the recession. But, I suppose this year is going to be the pits for me, between having no savings left, a leaky roof, a shaky job, canceled hurricane & peril insurance and a county wide mortgage to top it off. I didn't ask for any of this either. It just happened. I even got a year older to add to the misery, even after I asked to go a year younger. sigh.
Good News: I saw disaster coming. Sold all Fidelity China Fund in Nov 2007, almost at peak $48, now $18. Flipped 5 homes 2002 to 2007. Paid off my home, cars, all credit cards, I have zero debt.
Bad News: Had two companies 13 years and recession put them out of business. I have no income, can't find a job. I am SOOOOOO angry at the stupid greedy flippers who ruined the economy! Everyone I know lied on their mortgage application, but these criminals still have their jobs. I am careful so all my flips I paid in cash, all under $150k. I AM RESPONSIBLE. I learned responsible gets you nowhere! Now I am plowing through my savings, I am scared and depressed.
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