BluefoxToday blog : How did some predictions about 2008 turn out? You guessed it.

How did some predictions about 2008 turn out? You guessed it.

2008 is at last behind us and it was what it was. A thoroughly memorable year for the mortgage and real estate industries, and the entire U'S economy for that matter. As years go, a few in the recent history have had as many spectacular market events rumble through the landscape as this one, leaving charred and burnt wreckage smoldering behind.  

Some of the true visionaries inhabiting this land had a few encouraging words to pass on about how 2008 would shape up and now they ought to be spanked for ever opening their mouths. Consider this.

"I expect there will be some failures.... I don't anticipate any serious problems of that sort among the large internationally active banks." That was Fed Chairman Bernanke expressing his views on February 28, 2008. This past fall WaMu just flat out fell apart, Citigroup survived on the taxpayer's money to see another day and so on. The list is long and colorful.

"Existing home sales to trend up in 2008." This from NAR's press release dated December 9, 2007. That was an entirely optimistic view of the future that proved to be plenty of hot air that all active housing market observers can attest to.

"Freddie Mac and Fannie Mae are fundamentally sound.... I think they are in good shape going forward." Barney Frank, House Financial Services Committee Chairman, had the nerve to say this on July 14, 2008. Only two short months later the government took over their operations because they were basically collapsing under the weight of bad mortgage paper.

Generally speaking, it's good to be optimistic about life and markets and those sorts of things. Yet, when the writing is rather plainly on the wall, saying something that goes straight against reality is dangerous to your reputation. Not only that but when people in high positions do it the marketplace starts doubting the soundness of the business environment and becomes really nervous about what lies ahead. That predictably leads to more caution and further slowdown of economic activity. Be careful out there what you say.  

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Provided by: 

Esko Kiuru
Mortgage, real estate and apartment industry analyst 

www.BluefoxToday.com - syndicated mortgage, housing and property management blog

eskokiuru@gmail.com
My cell: 702-499-1006

Comment balloon 6 commentsEsko Kiuru • January 13 2009 05:19PM

Comments

Esko, 2008 fell far short of what I hoped it would be, but I am hoping that 2009 shines a little brighter.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) over 9 years ago

Well, at least one of them was right with the trend going upward.  Everyone is crying in their beer about 2008, but in reality, we closed more homes in 2008 than 2006 (and obviously crushed 2007) here in the Las Vegas / Henderson area.  They may have sold for less money, but the activity is there and that is a major first step to a strong recovery effort.

Now if we could only get reduced doc loans back......if only......

Posted by Mike D over 9 years ago

I love the post. I missed all of my predictions. The good news is I know 2009 will be better.

Terry  Miller

Posted by Terry Miller, Miller Homes Group and Tyler Apartment Locator (Miller Homes Group) over 9 years ago

George,

It's a new year and a new attitude is called for.

Posted by Esko Kiuru over 9 years ago

Mike,

Low-doc mortgages will return once the lenders clean up their balance sheets.

Posted by Esko Kiuru over 9 years ago

Terry,

It's fun to check back on what people said about certain things and compare it to the real thing.

Posted by Esko Kiuru over 9 years ago

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