stock market was up today...

[Rasputin_Vol]

Stocks Tumble On Report Boeing Faces Criminal, Civil Probe Over 737MAX Production

 

[SpaceCoastVol]

POS Boeing.

 

[Rasputin_Vol]

Boeing Has New Problems With the MAX Jet’s Software. The Stock Is Rising Anyway.

At what point do you cut your losses and throw in the towel?

Boeing 737 MAX expected to remain grounded until at least August: sources

 

[05_never_again]

One more: which city does Chattanooga sprawl towards?

Chattanooga actually sprawls towards Knoxville, but I don't think that's because Knoxville is some big center of gravity.

Chattanooga is precluded from sprawling towards Nashville because of Lookout and Signal Mountain. It's also kind of prohibited from sprawling towards Birmingham for the same reason (Sand Mountain). There's a state border just to the south with a state income tax on the other side of it, so that probably precludes sprawl towards Atlanta. The areas east and northeast of town are flat and spacious, so the city has basically had to grow that way over the years. Ooltewah, East Brainerd, Collegedale, Apison. There's also some lower-density sprawl north of town (Red Bank, Hixson, Soddy-Daisy).

I think if the state tax structure was the same in Tennessee and Georgia, Chattanooga absolutely would have sprawled pretty extensively towards Atlanta over the years. If you drive on I-75 South towards Atlanta, it never really becomes all that rural except for a couple of spots. All sorts of smaller towns and the associated sprawl right until you get to the Atlanta suburbs. The drives from Chattanooga to Knoxville, Nashville, and (especially) Birmingham are much more rural by comparison.

 

[NorthDallas40]

So I just read a WSJ article on how AirBnB property owners or “hosts” are completely upside down during this fiasco since there is no travel or vacation business.

Basically you have a bunch of debt fueled want-to-be hoteliers. They bought properties on credit and counted on bookings to be able to make their mortgage payments.

And I’m really not having any sympathy for them from reading it. I mean what the hell should they expect. Their balance sheet is nothing but liabilities. And I see no reason there should be any money provided to bail them out.

What do y’all think?

 

[hog88]

So I just read a WSJ article on how AirBnB property owners or “hosts” are completely upside down during this fiasco since there is no travel or vacation business.

Basically you have a bunch of debt fueled want-to-be hoteliers. They bought properties on credit and counted on bookings to be able to make their mortgage payments.

And I’m really not having any sympathy for them from reading it. I mean what the hell should they expect. Their balance sheet is nothing but liabilities. And I see no reason there should be any money provided to bail them out.

What do y’all think?

Nope, no bailout. Let them be foreclosed on so I can scoop up some cheap investment properties........

 

[NorthDallas40]

Nope, no bailout. Let them be foreclosed on so I can scoop up some cheap investment properties........

Only if when you scoop them up you have enough assets to make bank when nobody is occupying them you noob!

Also I bet that will be their scare mantra. If you don’t save us we will flood the real estate market with depressed properties!

To your point yeah bring that **** on.

 

[37L1]

So I just read a WSJ article on how AirBnB property owners or “hosts” are completely upside down during this fiasco since there is no travel or vacation business.

Basically you have a bunch of debt fueled want-to-be hoteliers. They bought properties on credit and counted on bookings to be able to make their mortgage payments.

And I’m really not having any sympathy for them from reading it. I mean what the hell should they expect. Their balance sheet is nothing but liabilities. And I see no reason there should be any money provided to bail them out.

What do y’all think?

Did we bailout property owners who bought to flip before the housing crash?

This is the same thing.

 

[hog88]

Only if when you scoop them up you have enough assets to make bank when nobody is occupying them you noob!

Travel will come back. People will need rentals when the banks start foreclosing. Plenty of opportunity out there

 

[05_never_again]

So I just read a WSJ article on how AirBnB property owners or “hosts” are completely upside down during this fiasco since there is no travel or vacation business.

Basically you have a bunch of debt fueled want-to-be hoteliers. They bought properties on credit and counted on bookings to be able to make their mortgage payments.

And I’m really not having any sympathy for them from reading it. I mean what the hell should they expect. Their balance sheet is nothing but liabilities. And I see no reason there should be any money provided to bail them out.

What do y’all think?

Don't disagree at all, but you have to expect that everyone is going to have their hand out when you look at what happened during and since the financial crisis. They are basically giving money away to small businesses via the PPP. Depending on what you were making pre-virus and what your state's unemployment benefits are, many people are in a situation now where they make more on unemployment than they did working.

Upside down Airbnb-ers are just the latest group looking to get "theirs."

 

[05_never_again]

Did we bailout property owners who bought to flip before the housing crash?

This is the same thing.

They bailed out the banks that owned the bad paper, not the property owners themselves.

 

[Rasputin_Vol]

Basically you have a bunch of debt fueled want-to-be hoteliers. They bought properties on credit and counted on bookings to be able to make their mortgage payments.

And I’m really not having any sympathy for them from reading it. I mean what the hell should they expect. Their balance sheet is nothing but liabilities. And I see no reason there should be any money provided to bail them out.

So wait, you mean debt is a liability? Huh, who woulda thunk it?


As far as a bailout for them? I lean 80/20 on the side of not bailing them out for the very reason you mentioned. Plus, if it wasn't coronavirus, they would have eventually rolled over just based on the fact that the economy was well overdue for a correction anyways. However, these governments shutting down the economy is some unprecedented nonsense.

 

[rjd970]

They bailed out the banks that owned the bad paper, not the property owners themselves.

This.

And on top of it, the PMI most of them were paying were worthless and didn't pay out anyway. People are still paying it too, that is a racket.

I say everybody makes their own bed.

If you bail out the banks, you should bail out the homeowners. Otherwise, lets all play by the same rules and everyone go under like this is supposed to work. I'm sick of seeing the big guys bailed out when an investment fails and then everyone else is told "that is the risk with any investment".

 

[05_never_again]

This.

And on top of it, the PMI most of them were paying were worthless and didn't pay out anyway. People are still paying it too, that is a racket.

I say everybody makes their own bed.

If you bail out the banks, you should bail out the homeowners. Otherwise, lets all play by the same rules and everyone go under like this is supposed to work. I'm sick of seeing the big guys bailed out when an investment fails and then everyone else is told "that is the risk with any investment".

The banks are able to get away with it because of the role they play in the financial system. They weren't kidding when they talked about Armageddon-type stuff occurring if they weren't bailed out in 2008/09 and forced to recapitalize. If there is really going to be a cataclysmic event if nothing is done, then of course something is going to be done, even if it pisses everyone off. "Too big to fail" is their business strategy. They get to participate on the upside, and their downside risk is limited.

 

[Velo Vol]

At what point do you cut your losses and throw in the towel?

Boeing 737 MAX expected to remain grounded until at least August: sources

You've convinced me that you shouldn't buy Boeing stock, if you were on the fence about it.

 

[rjd970]

The banks are able to get away with it because of the role they play in the financial system. They weren't kidding when they talked about Armageddon-type stuff occurring if they weren't bailed out in 2008/09 and forced to recapitalize. If there is really going to be a cataclysmic event if nothing is done, then of course something is going to be done, even if it pisses everyone off. "Too big to fail" is their business strategy. They get to participate on the upside, and their downside risk is limited.

Then this isn't capitalism. It's corporate socialism.

If that is what it is, then fine. The banks should have to offer better terms and payment forgiveness type programs. The socialism should have to play both ways.

 

[NorthDallas40]

Then this isn't capitalism. It's corporate socialism.

If that is what it is, then fine. The banks should have to offer better terms and payment forgiveness type programs. The socialism should have to play both ways.

Don’t disagree with this. They are tasked to have risk models to determine loan terms. If they suck at their jobs then they should pay the price. I think it gets clouded when you have government mandates on forcing certain loans which goes back to Carter but those are primary residence loans too. When these hosts are buying their 4th and 5th properties all on credit I think that should have to rest squarely on piss poor risk mgt by the lenders

 

[05_never_again]

Then this isn't capitalism. It's corporate socialism.

If that is what it is, then fine. The banks should have to offer better terms and payment forgiveness type programs. The socialism should have to play both ways.

Of course it isn't capitalism. It's capitalism in bull markets, corporatism in bear markets.

 

[rjd970]

Don’t disagree with this. They are tasked to have risk models to determine loan terms. If they suck at their jobs then they should pay the price. I think it gets clouded when you have government mandates on forcing certain loans which goes back to Carter but those are primary residence loans too. When these hosts are buying their 4th and 5th properties all on credit I think that should have to rest squarely on piss poor risk mgt by the lenders

This is a large part of it, totally agree. Banks being forced to give these loans are an issue. Government should stay out of it.

If a homeowner has a mortgage for their primary residence, it is a shared risk on agreed terms. If a homeowner gets a mortgage on thier fifth investment property and the bank approves the loan, the bank has a problem.

 

[Rasputin_Vol]

The banks are able to get away with it because of the role they play in the financial system. They weren't kidding when they talked about Armageddon-type stuff occurring if they weren't bailed out in 2008/09 and forced to recapitalize. If there is really going to be a cataclysmic event if nothing is done, then of course something is going to be done, even if it pisses everyone off. "Too big to fail" is their business strategy. They get to participate on the upside, and their downside risk is limited.

So are you ok with this "too big to fail" arrangement? I'm asking because I can't tell just by reading this.

 

[Velo Vol]

Of course it isn't capitalism. It's capitalism in bull markets, corporatism in bear markets.

Win - win.

 

[05_never_again]

So are you ok with this "too big to fail" arrangement? I'm asking because I can't tell just by reading this.

No, of course not. Just stating what the current arrangement is.

What the regulators and the big banks don't allow is a conversation about "too big to fail" to occur in a good economy. If they did, there might be incremental steps taken to change the arrangement (of course, in a way that still benefits the banks, but might reduce systemic risk). There's always inevitably some other "priority" to be found when things are good, and nobody worries about a future banking crisis in a moment where everybody is making money and things are stable. They aren't worried about the conversation occurring in a crisis situation. It inevitably will, and the "let them fail" argument is always a loser in that moment because there are no libertarians in a crisis.

I was in college during the financial crisis and was a finance major. Quite often debates would occur during classes about the current events of the time, and when I spoke up it was usually some kind of sarcastic comment about bailouts. In one of these discussions I had a professor tell me something to the effect of "I don't disagree with you in principle, but what you're doing is telling a guy in the ER who is in the middle of having a heart attack that he should have changed his diet and started exercising 10 years ago. Nobody wants to have to do bailouts, but there isn't really an alternative at the moment."

I disagreed with that notion at the time, but as time has gone on I've grown to agree with that sentiment. However, let's continue the professor's analogy. Shortly after the heart attack, that man was released from the hospital and in relatively short order was able to return to a normal life without any ill effects. Not only has the man returned to a poor diet and no exercise, he's eating even unhealthier than he was before, and his doctor is actually encouraging this behavior and saying he doesn't think he'll have another heart attack.

IMO, the essentially unlimited QE in the wake of the financial crisis is way more difficult to justify than that bailouts were.

 

[05_never_again]

Win - win.

Yep. Rules apply to little people.

 

[Velo Vol]

I disagreed with that notion at the time, but as time has gone on I've grown to agree with that sentiment. However, let's continue the professor's analogy. Shortly after the heart attack, that man was released from the hospital and in relatively short order was able to return to a normal life without any ill effects. Not only has the man returned to a poor diet and no exercise, he's eating even unhealthier than he was before, and his doctor is actually encouraging this behavior and saying he doesn't think he'll have another heart attack.

In January 2020, would you have described the patient (US economy) as healthy? Or about to have a heart attack?

 

[Rasputin_Vol]

In January 2020, would you have described the patient (US economy) as healthy? Or about to have a heart attack?

I'll answer that. Heart attack was imminent.