In the Basement and in the Tank

Coldwell Banker Announces a 10-day, 10% off sale:

Starting on October 10, 2008, Coldwell Banker will kick-off its first-ever national "10-Day Sales Event" - during which participating home sellers from across the United States will reduce the listing prices of their homes by up to 10 percent. The 10-Day Sales Event will run nationally through October 19, 2008.

"Despite the difficult headlines regarding our overall economy, the residential real estate market has been showing several positive signs over recent months that could be signaling a tipping point," said Jim Gillespie, president and chief executive officer, Coldwell Banker Real Estate LLC.

"Yet our research and discussions with our brokers and sales associates shows that in many markets sellers remain reluctant to list their homes at the proper prices necessary to attract buyers," continued Gillespie.

In a recent survey of 3,379 Coldwell Banker real estate professionals in markets across the United States, 56 percent said that listing prices in their market remain above where they need to be to attract qualified buyers. Additional findings of the survey include:

• 77 percent agreed that the majority of sellers in their market still have unrealistic expectations regarding the initial listing price for their homes
• 79 percent agreed that homes in their market that are priced appropriately are attracting more buyers and moving more quickly
• 76 percent feel that a 10 percent or less reduction in listing prices in their area is all it will take to help push these homes over the "tipping point" to a sale

"Our brokers and sales associates agreed that, even in the current climate, it will not take much movement to attract those buyers who have been watching and waiting," noted Gillespie. "Depending on the market, a price reduction of just 10 percent or less just may make the difference in both satisfying sellers and bringing buyers to the table."

Totally Tanked Stock Prices from NASD100.com

There are very few survivors to date.

The above link takes you to their October 2, 2008 S&P 500 table. Navigate around to find the DJIA and NASDAQ data, then update the prices. (With this bloodbath, it's not difficult.) These tables would be an excellent place to start when you are looking to re-build your portfolio.

Year to date, there in only ONE component (WMT) of the Dow Jones Industrial Average that is positive. Let me rephrase that: 29 out of the 30 DJIA stocks are down year to date.

Only 35 of the S&P 500 stocks are positive YTD. Let me rephrase that: 465 out of the 500 S&P 500 stocks are down year to date. Let me rephrase that: 93% S&P 500 stocks are down year to date.

You can do your own math on the NASDAQ 100.

This is astonishing.


Axel Merk writes on The World in Crisis

Where are the safe havens?

We have been warning for some time that “there is no such thing as a safe asset anymore, you have to take a diversified approach to something as mundane as cash.” Unfortunately, the current crisis shows that we may be right. Physical gold is attractive to many investors because of its lack of counter party risk. The only counter party risk with gold held in your personal vault is that someone may break in and steal it. However, even staunch gold bugs rarely hold all their net worth in gold, but diversify if for no other reason that it is impractical to have essentially all your net worth in gold. And while gold is currently fulfilling its role as sound money, it often trades in tandem with other commodities; this can result in stomach-twisting volatility. As a result, many hold gold as insurance, but few truly live on their personal gold standard.

In our analysis, we have not seen the end of the crisis; we expect continued volatility in the days, weeks and months to come. While we have been critical of U.S. institutions for not acting fast enough, there is progress. The remaining large financial institutions may be too large to fail; institutions from Bank of America to Citigroup; from Goldman Sachs to General Electric have been swallowing tough medicine to strengthen their respective balance sheets in a market when capital is expensive. In Europe, financial institutions still have a lot of work ahead of them; however, it does look like European governments are waking up to the seriousness of the situation. Without passing judgment whether bailouts should have taken place, European governments have shown both will and ability to act. What makes us more positive about Europe than many is that, ultimately, European economies are less fragile because of – with some regional exceptions - much healthier consumers and less elevated home prices. European governments may also be more willing to nationalize banks or force capital injections to protect the system than U.S. regulators are. Ultimately, it is capital that is missing more than anything; and then there’s the value of homes that triggered all of these – in the U.S., home prices continue to be too expensive, posing further risks to the U.S. economy and the dollar. Finally in Asia, while Japan is ironically shining, the region has yet to see the full impact of weaker sales to the U.S. and potential shocks to their real estate markets.

We don’t have a crystal ball either. But being active in parts of the money markets both domestically and abroad, we are concerned at what we see. There is a significant risk that the U.S. dollar resumes its downward trend. As a result, investors may want to consider diversifying to take this risk into account.