Big hat tip to Doomster NVmike, and assist to Phoenix area realtor Greg Swann, for noticing this blog post by BusinessWeek’s Senior Economics Editor.[1]
[BW post withdrawn ... replaced as follows, JM]: "Dear Readers, I posted an item yesterday questioning the precision of MLS data in Phoenix, Tucson, and Las Vegas, but several people are questioning my questions, so I pulled the item off the blog until I can sort out the truth. I hope to have something to say on this subject next week."
As it happens, Greg didn’t just pass on the link, he contributed some criticism,[2] too.
"Was a big-time Sixth Avenue media giant flim-flammed by a Gilbert, AZ, housewife, nom de guerre ‘Twist,’ who has set herself up as an authority on the residential real estate market and its feverishly-sought collapse?
…
As it turns out, the only thing wrong with this [3] is everything.I have no idea why we’re talking about November and December of 2005 and January of 2006, but these are the actual numbers for Expired, Cancelled, Sale Pending and Temporarily Off Market listings from those months, …
…
Why are so few homes listed as Sale Pending or Temporarily Off Market? Because the status of those listings has changed in the intervening months, most of them to Sold.I have no idea what ‘Twist’ was failing to measure, but a Realtor would only be concerned with Expired and Cancelled listings, recognizing that the other two categories are nebulous and subject to change.
And, obviously: Bubble bloggers are notoriously reckless with numbers. They have an agenda, so they tend to throw out any data that do not fit their preconceptions. I have no idea if that’s what has happened here, but I can’t see any way for ‘Twist’ to have made an honest error."
Clearly, these are just the opening moves. BW likely hasn’t exausted its ammunition with Peter’s short post. Greg shot from the hip, putting up a bunch of MLS numbers (asserted to be checked by some realtor commenters) from the same era as those covered by Twist. I don’t know if the two sets even relate to each other, but at least the initial REIC aspersions came with a smattering of allegedly relevant facts. Full courage points assigned for coming to a screeching halt just short of libel in that last quoted sentence. 
And speaking of namecalling, you’d think Greg could do better than repeating Twist’s handle a half-dozen times with quotes. His post title showed some originality, but doesn’t parse very well (the obvious reading of the last word is as a newly discovered occupational hazard). I’ll forgive him for that, though. He contributed a really good title for this effort.
And one last thing. Someone should mention to Greg that Twist is a homemaker who does post-Masters degree level hard sciences research and has published in a field where statistical analysis is the bulk of the work. It is just possible she can recognize a data set when she sees one.
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Notes and References
[1]: "Fuzzy Realtor Numbers In Phoenix, Tucson, and Vegas", by Peter Coy, Hot Property blog, BusinessWeek, January 3, 2007.
[2]: "Twisted minds: Was BusinessWeek bamboozled by bubble-blogstress?", by Greg Swann, Phoenix area realtor’s blog, January 4, 2007.
[3]: Greg had been quoting from [1] prior to that sentence.
And, obviously: Bubble bloggers are notoriously reckless with numbers. They have an agenda, so they tend to throw out any data that do not fit their preconceptions.
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Greg is desperate! And speaking of who has an agenda. As for reckless with numbers, the NAR and other REIC reports are always positive, as is Greg’s site so if anyone can be accused of dishonesty or just producing prevarications it would be them. But it is their livelihood and so they hope their dishonesty will keep the paychecks coming. So who has more at stake bubble bloggers or an industry based on spin and selective reporting of statistics?
Come on, Twist! Would you just be quiet and let these nice people keep fleecing the starry eyed debt buyers! Now that I know you have an “agenda” your devious plan seems clear!
I just watched the Peter Schiff video you had on the right hand column:
http://www.europac.net/Schiff-Fox-12-31-06_lg.asp
It was amazingly timely (to this post) that the only people who were “wound up” on the video were saying RE was going up, up, UP in 2007.
I think Mr. Schiff had some very strong logic behind his presentation. One of the guys disputing him worked for ReMax, so at least HE didn’t have an “agenda!”
Thanks for what you & John do!
Please continue in 2007, even though your evil, devious agenda has now been revealed.
BTW: I’ve been coming to this blog for a while now, and I can’t remember anyone asking me to buy anything or give any money…
either my memory is failing, or your devious agenda isn’t as profitable as Mr. Swann’s benevolent endeavors. He’s asking for my money right on his home page, and every page after that.
You guys should maybe take notes from him.
(Man, the sarcasm is just dripping out this morning, heh?)
Ooops! I mad a mistake.
I referred to the actions of the REIC as a “fleecing.”
I was told one time back on the farm that you can shear a sheep many, many times… but you can only skin him once.
I have a feeling that a lot of people who earn $ 50 K / year around here and signed up for a $ 400K house are more likely skinned than sheared… since they may only have that chance once!
(at least for 10 years, with the new BK rules)
I stand corrected.
“made” a mistake
I sit corrected, too.
I find funny all of the effort put into trying to demonize the so-called “bubble blogger”; that we are “bitter renters” who only look at articles or numbers that “fit our worldview”.
You can spin this issue one way or another, but what comes bobbing up like a cork again and again is this fact…
The current international housing crisis is a classic financial (credit) bubble and it will end badly for many many people.
As I am sure most of you have noticed, there has been a withdrawl of the BusinessWeeks favorable reference to this site, at least pending further review by the Editor. I view that with mixed emotion. I am saddened and a bit angry by Mr. Swann’s unfair attack on Twists motivation. It is, of course fair to challenge the sources and accuracy of her data and the conclusions she draws, I believe she would be the first to agree. When she returns I suspect she will honestly review the numbers, straight forwardly report the results, and if errors were made, admit it.
To Mr. Swann, I would merely reference an old saw about glass housing.If the withdrawl was at his urging, or the urging or real estate interests, I hope favorable references to Twists work are restored. Her data and reasonable cautionary advise can reach a larger audience with favorable references in the MSM.
However, my mixed emotion to the original article was its reference to this site as “highly recommended.” Like some of the previous commentors I have followed this site for awhile (late June I believe) I came to it simply enough. Having sold a house in another state in March, I was adrift in the Phoenix market looking to replace my primary residence. I saw a reference to Twist and the site in a Gilbert newspaper(yes MSM). I had never been on a “Blog” before and found it amazing.
Many of the things I had experienced when selling my house and in looking for a new one were reflected in Twists postings. It was a refuge from the “Be smart, buy now” rhetoric that most (not all) realtors were using with me. Her data was crisp and creative, and her only motivation seemed to be to carefully and honestly inform others.
I “highly recommended” the site to a few friends, a couple of trustworthy realtors, two brilliant academics (one of whom loathed Blogs) and a former business partner. The reaction of the realtors was favorable, if not joyous. However, in the Fall I recieved a call from one of my other friends who said “have you lost your (expletive deleted) mind”, and proceeded to blast away at a posted article and some refences from the site(my first introduction to Mr. Smith I believe). While this is a friend most familiar with calm, peer reviewed research and discussions between qualified professionals, the comments I recieved were not of her usual tenor. I believe “insane” and “bizarre” were the kindest things she said. She had no interest in real estate, other than academic. I was shocked.
I returned to the site and quickly figured out that the posting and references were not by Twist, but by her co-editor, John. Quite frankly I had only read Johns work once before, it did not interest me at the time. I freely admit I was not as shocked by the “opinion piece” (on mortgages I believe) as my friend, but neither was I impressed by what seemed to be the pretend scholarship, even with the “footnotes”. It clearly lacked the disicpline, rigor and factual basis of Twists work, I was surprised by his intense interest in lending and finance, and his obsious willingness to express opinions, given his background.
Since that time I have tried to read most things on the site, and as some of you know have on way too many occasions made long winded, (like now, but be patient, it is the last), snotty, arrogant and sometimes, but not often, unfair criticisms of similar work and some of the references deemed “relevant” (if not recommended) by the site editors. After my intense reading of the side bar references and the non-Twist postings for a few weeks, I am saddened to say I never recommended the site again.
Over the months my concerns grew as I saw a infestation of “gold bugs” and an increase in the number of wild conspiracy theories espoused, but never by Twist. I tried sometimes gently, often not so gently, to suggest that the credability of the site and Twist’s valuable work were being threatened. Some times the most extreme items were portrayed as “humor”, but the John’s vigorous defense of the “value” of “considering” the wholly unsupported, and often shocking, opinions, plus a tenor of the propogandist’s art in the way the “humor” was spun, only increased by concern.
Over time normal letters sent by pension funds to retirees became portrayed as dire signs of economic collapse and improper actions by fund managers; wildly unsupportable predictions of future housing prices appeared regularly on the sidebar from mysterious, uncredential authors, who often advertised for gold dealers.
Yesterday, there was the Full Monty. Although classed as humor, casual readers confronted purported “documents” and theories that could suggest to some that defaulting on your mortgage is lawful and will not lead to losing your property. The article was repleat with references to Illuninate and Banker conspiracies, alleged binding law (from a county Justice of the Peace 35 years ago no less) and a full assault on the “racist elite” from the likes of the “Populist Party of America”. The referenced Blogs were not kidding and, quite frankly neither was the postings author and site co-editor when he opined that, in his opinion “for what it was worth”.. “the Feds money really is unconsititutional”.
I hope no reader ever acts to their detriment based on such postings, as has happened when similar extremist propoganda actual led some to not pay federal income taxes. Some are now defendants, prisoners or fugatives (one was also favorably self profiled in yesterdays references).
I also hope that readers have no more been decieved into believing the “safety” of investing in “gold” after reading the sites numerous references to such advocates (and salesman) than have hapless homebuyers been decieved by the much vilified Mr. Lereah. If I had followed the gold bugs advise in second quarter 06 when my real estate was sold, I would have lost about 14% as of close today. Almost makes a home in Scottsdale over the same period look good. Please seek the advise of a QUALIFIED PROFESSIONAL when making important money decisions, not pretend experts from the bloggs or people with personal agendas, monetary or political.
And I really hope BusinessWeek and others judge Twists work on its merits and purpose, not by the other materials increasing spread on this site. Her work has value to a far wider audience, the rest of this so-called “information” largely does not.
In the real world you are, however unfairly,often known by the company you keep. I hope that reasonable distinctions between Twists work and many of the extreme positions set forth by others, including co-editor John,can be made by the MSM. I pray that the most clarly objectional articles on this site are not used by those with a Realtor profit motive agenda to discredit Twists work merely by association. Good night and good luck to all.
Old Mike -
This piece deserves to be a post. I’m tempted to attach a letter of resignation to it.
I’ll make up a title if you don’t specify one. You’re on for 12:05AM MST Saturday.
John, please do not make a big deal out of this, its not a primary focus of the site. I do not want any prominant placement or review. its here, it is waht it is.
And there is plenty of reasons to continue helping Twist, she needs the support, now more than ever. Just be careful, and recognize that words have real world effects. Everything thats “interesting” is not appropriate, there are tried and true methods to separate the valuable from the, well completely valueless. Your a real smart guy, I’ll bet your read Proust and love Fitzgerald and all that, but we live in times where uncertain people can make very big mistakes. We must be part of the solution, never the problem. Or as some old and very strange friends might say, “Stay on the bus, enjoy the trip, but watch the curves.”
Old Mike -
Good guess about Proust. I waded through Moncrieff many years ago and have got as far as about a quarter into Le Côté de Guermantes using my bureaucrat’s French. I haven’t read much Fitzgerald. My prose favorite is Nabokov, along with a few odd-ball choices like Logan Smith.
Anyway, I’m going to pull rank and put your excellent effort above the bar. As well, I’ll have a good hard look in the mirror tomorrow and think at length about what you’ve been saying.
Today was my six month’s anniversary here.
Good time to reflect.
John. How many Poe references could you find in the first 3 pages of Lolita? And what about Pale Fire? We are more alike than either wishes to admit. And we both care about the site. I urge you again to make no big deal out of something like this, we don’t want to tip off the “bad guys” as to tactics and they never read beyond the main post anyway. Do you really need copy that bad. Happy anniversary John, sorry if I put a damper on it, but you predicted it…hey, maybe you are a soothsayer after all!;-)
Pale Fire should come with an operator’s manual. I think VV was parodying his own monumental unrhymed translation of Eugene Onigen (I’ve only read the abridged version without the stuff about the author’s African grand?father and Russian prosody).
Whether I’m still here next week, I’d be happy to take this offline and keep going.
OK, back to business.
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[4]: “Avoiding a close shave with Occam’s Razor . . .”, by Greg Swann, Phoenix area realtor’s blog, January 6, 2006.
[...] Apparently, the row between the two started when a senior BusinessWeek editor affiliated with their fine Hot Property blog posted some analysis by the Doom folks (the post in question is gone now), which managed to touch a nerve with some realtors who felt the numbers were incorrect. We may not have a dog in the fight, but watching a statisticiango up against a realtor is a surprisingly great way to pass what little idle time we’ve got during the week. [...]