In one of the most blatant cheerleading fluff interviews in history, Bloomberg touted a “Housing Panel Discussion Like No Other“. Indeed it was. Click on the link for an audio of what can best be described as a three ring circus act.

Meet The Clowns

  1. Chris Kelly (CGK Construction)
  2. John Sauro (North Atlantic Mortgage Corp.)
  3. Conrad DeQuadros (Bear Stearns)

Clown Excepts

Chris Kelly (CGK Construction)

  • Lower home prices are because builders are building smaller homes not because of price cuts.
  • On existing home sales, if people drop their prices they are still going to come out ahead.
  • It’s not like you are going to get a 3000 square foot house for cheaper price. You will get a 2000 square foot house for cheaper price than a 3000 square foot house.
  • Land still costs and materials have not dropped in price.
  • The only savings is in the size of the house.
  • Looking forward to a strong season.
  • The FHA was not giving out enough money to buy a house.
  • FHA raising limits would help things out a lot.
  • If someone can get $425,000 from the FHA they can buy a home from me.

John Sauro (North Atlantic Mortgage Corp.)

  • Chris Kelly is right about home prices.
  • People selling existing homes are still making money.
  • The market was “very healthy” over the last 3-5 years.
  • People pricing their home to sell will still make money.
  • Delinquencies will peak in 2007 well below past peaks.
  • A lot of subprime lending concerns are very overblown.
  • We do not want to see subprime programs go by the wayside.
  • Now is an excellent time to buy as home.
  • The subprime market helped the first time homebuyer to get a home.
  • Rate hikes have gotten the Fed into trouble.

Conrad DeQuadros – Senior Economist – Bear Stearns

  • Unusual weather patterns created volatility in housing.
  • We are probably near the bottom here.
  • Homebuilder sentiment index shows increases in sales are expected this year.
  • OTHEO has it right and saw a 6% increase in prices by Q4.
  • The economy is on a firm footing.
  • The labor market is strong and that will support the consumer.
  • We may see a modest moves up in interest rates second half of 2007.

Totally Lame Excuses

  • Blaming the FHA for not making enough loans.
  • The weather.
  • Rate hikes got the Fed in trouble.

Totally Lame Statements

  • Home prices are not dropping, rather homes are getting smaller.
  • The economy is on a firm footing.
  • Subprime concerns are overblown.
  • The labor market is strong.

Mike Shedlock / Mish/