Jim Cramer: "The Worst Is Over"

By
Real Estate Broker/Owner

Despite RealtyTrac's recent announcement revealing that foreclosure filings surged 33% from last year, Jim Cramer is refusing to back down from his shameful housing bottom call that he made in June.  In fact, Cramer took his prediction one step further on Thursday when he wrote, "the worst is over" while referencing JPMorgan Chase's recent earnings and statement about delinquencies stabilizing.

While the case can certainly be made that the banking system has been back-stopped thanks to TARP, hundreds of billions of loan guarantees made by the Treasury, and some very bank-friendly tax benefits, it is reckless for Cramer to think that the worst is over for the housing market, how could it be?

With unemployment not projected to peak for another 9-12 months and with most economists agreeing that there is a correlation between job losses and foreclosures, with a wave of option-arm defaults on the horizon, and with foreclosures already surging 33% from last year, Cramer's math doesn't add up.  It's not 1991 all over again, Cramer, its 2008 all over again.

 

 

 

 

 

Comments (9)

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Ugh, don't get me started on Cramer.  Credibility = ZERO.

Jul 17, 2009 04:33 PM
Christine McDaniel
Christine McDaniel Realty, LLC - Avon, IN
Broker Associate

Consider the source - next he'll be quoting Biden "We misread how bad the economy was"

Jul 17, 2009 04:48 PM
Terry Chenier
Homelife Glenayre Realty - Mission, BC

Mark, Yhis guy's an a*****e and shouldm't have air time. Read my previous blog on him.

Jul 17, 2009 05:45 PM
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate

Mark:  I think Jim Cramer is a simply a BLOWHARD.  Now, if we can start sending the mortgage payment stubs of our short-sale sellers to him, and have him promise to pay them all... THEN I will believe him.  Until then... noper.

Jul 17, 2009 05:51 PM
Jim Hale
ACTIONAGENTS.NET - Eugene, OR
Eugene Oregon's Best Home Search Website

I don't know Cramer...don't want to know Cramer.

But there ARE some signs he might be right.  In a lot of places.

None of those are in Arizona, Mark -- so I (sort of) feel your pain.

 

AND, Mark, it is fair to point out:

As an author of a book on the subject, you now have a vested interest in the continuation of doom and gloom.

Jul 17, 2009 06:07 PM
Sharon Alters
Coldwell Banker Vanguard Realty - 904-673-2308 - Fleming Island, FL
Realtor - Homes for Sale Fleming Island FL

There are definite signs of improvement in the housing market - but it remains to be seen if the banks are going to really be able to work with people to keep them in their homes. From what I have heard about loan modifications, there isn't much working right there.

Sharon

Jul 17, 2009 07:25 PM
Fernando Herboso - Broker for Maxus Realty Group
Maxus Realty Group - Broker 301-246-0001 - Gaithersburg, MD
301-246-0001 Serving Maryland, DC and Northern VA

Kramer is funny and keeps me entertained every time I see him. . specially when he disagrees with Jerry Seinfield. .and the other CRAMER too. .is ENTERTAINMENT!

Jul 17, 2009 11:17 PM
Mark MacKenzie
Phoenix, AZ

Jim:  I base my argument on facts.  I would be happy to debate them if you have a counterpoint you would like to make. :)

As for agendas, those in the sale of real estate have one as well.  I can assure you I make more money selling real estate than I do a book.

For what it is worth, Phoenix, along with Las Vegas and several markets throughout CA are one of the few markets showing sings of supply and demand strength.  All of these markets have under a 4 month supply of housing.  According to our NAR, only six states have shown increases in home sales over last year and 88% of metros lost value from last year.

We track local market conditions in real time (see Personal Real Estate Investor Magazine) by analyzing the supply and demand relationship for real estate.  While we have seen signs of things not getting worse over the past couple of months, there is still an awful lot of inventory out there which is continuing to drive down prices.  There are indications from multiple sources that a flood of inventory is about to make land-fall soon. 

 

Jul 18, 2009 01:17 AM
Mark MacKenzie
Phoenix, AZ

Jason:  Agreed. :)

Christine:  Don't get me started on Biden.

Terry: I will.

Karen:  Blow-hard is a great word to describe Cramer.

Sharon:  What I have seen is that demand certainly appears to have stabilized, how could it not considering the incentives.  The issue is that it is not strong enough to quickly absorb the excess supply of properties that are for sale, we still have price value declines to worry about.

Fernando:  I think you may have given me an idea for another post. :)

Jul 18, 2009 01:22 AM