Will the Fed cut rates again following August’s depressing home sales numbers? Someone sure thinks so. [Bloomberg]

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  1. beavis88 says:

    I say we’re long overdue for a “correction” to take some of these idiot homebuilders and lenders out of the market, permanently. The Fed should stop enabling their bad behavior with rate cuts. If a rate cut is truly necessary, that’s another story – but knee jerk reactions to crises caused by idiotic behavior should be the last thing we see from the Fed.

    Dear dumbasses: you built too many houses and you made loans to people you shouldn’t have. This is not the fault of the people you lent money to. This is your fault. This is not the Fed’s fault. This is not the stock market’s fault. This. Is. Your. Fault. Try to go about spiraling into bankruptcy in an orderly manner, and avoid dragging the rest of us down with your gross incompetence.

    /rant off

  2. Rupan says:

    I am sure that rates will come down more as this gets worse. For some reason the Fed seems to think that corrections and down swings shouldnt happenn in a modern economy. That everything should be up all the time. So if the market is down, lower rates until it goes back up.

    I agree with Beavis88 that a correction is necessary though.

    The super low rates of 4 or 5 years ago got us in to this mess in the first place. Everyone and their dog got approved for ARMs at 1 or 2%. Then whoops it adjusts upwards to 7%+ and all of a sudden you cant make your payment.

    The whole thing was a disaster waiting to happen. Builders for thinking it could go on forever, lenders for thinking that someone who makes $50K could afford a $300K house and the borrowers for not doing their homework to find out what it was they were really signing. Stupidity all around.

  3. tdogg241 says:

    They need to stop avoiding the correction that’s 100% necessary. Where I live, the median home price is $500k (and *still* rising, for now) while the median household income is just over $50k…almost a 10:1 ratio. Nobody can properly afford to buy a home with those numbers.

    I say bring on the correction and let thousands upon thousands of families lose their homes (that they couldn’t afford in the first place) and builders/lenders go bankrupt. All of their collective poor decisions have made it so that buying a home will be nothing more than a pipe dream for me for the next 5-10 years.

  4. catnapped says:

    Yeah, but we can’t risk a recession and in turn make Bush look bad, can we?

  5. Invisobel says:

    I’m buying my first home this year and things are looking up, the builder was desperate to get rid of homes and rates are low. This is a great time for us FTHB. This is a good opportunity for a whole lot of people who can afford a home to get a great deal. Hooray for subprime meltdown!!!

  6. Rupan says:

    @Invisobel: I am with you there. I was a FTHB earlier this year and couldnt be happier with the purchase. I got something that I couldn’t have gotten just a couple of years ago.

    Now if only I could get my tax assessor to realize that I only paid 2/3 of the assessed value. That is going to be a fun fight come March.