Wednesday, September 30, 2009
“Music has to be recognized as an element of socialization,” [Jose Abreu, who organized "The System" in which Dudamel learned music] says in Arvelo’s documentary, “as an agent of social development in the highest sense, because it transmits the highest social values, such as solidarity, harmony, mutual compassion, and it has the ability to unite an entire community and express sublime feelings"....
Or, as an 11-year-old violinist in Arvelo’s documentary puts it: “I imagine that God must be like music because something so beautiful can only be the work of God.”
* The Federal Accounting Standards Board changed the accounting rules in April 2009, so the banks could wait until the assets appreciated in value (read: until the real estate market improved) and therefore take less of a write-down against the losses.
BOTTOM LINE: The "toxic assets" are still on the banks' books.
"Liquidations" of delinquent loans are taking much longer than usual.The banks are taking longer to foreclose and holding foreclosed properties to avoid putting pressure on prices (and thus triggering writedowns). Mortgage mods are delaying foreclosures. Many houses are early in the foreclosure process.
We have wrapped many of Amherst's charts into the presentation below. Here is the firm's bottom line:
We are concerned that, in light of this housing overhang, the stabilization we have seen in home prices the last few months is temporary....
During the boom, sales of existing homes soared to 7 million a year. Now they're back to a more normal 5 million.
At the current rate of sales, it would take 8.5 months to clear all the inventory on the market. This is still high. Normally "inventory-months" averages about 6.
If Amherst Securities is right, meanwhile, there are another 7 million houses of "shadow inventory" that will hit the market in the next couple of years. It would take 16 months to sell this inventory.