San Diego Housing Bubble News and Analysis

You should never be 100% anything.

If the tide turns and recession turns into "devalued green paper" / "too fast growth" we get inflation. I would NOT be in cash.

Try for a mix of things. A lil gold, a lil bonds, lil commodity stocks, a lil blue chip, and throw some euro in there as well.

I have been out of the market as well, got most of this last rally but missed the last 100 points on the S&P 500,
But to be honest I think it is just what I see on this board that will keep the market zigzagging higher over the next few months,

Oh well I am not going to chase this at this point, I am waiting for the end of October to see where we are.
I would point out another thing as well that on the low end housing anyway I think we are seeing the same thing, worries and pessimism keeping builders from building and buyers waiting , but in the mean time the current and potential future foreclosures keep getting eaten a little bit more everyday.

IMO there is not a huge over supply of SFH sitting vacant in SoCal, Apartments maybe but not SFH.

I think that was smart, I personally would do the same thing. So that's why the market went down this morning.

I pulled out about 80% 2 days ago. That 80% will be in cash for now.

I've been thinking the same thing almost every day for the last month or so. The last time I considered it was when the Dow hit 14K. Well, and maybe at around 11. Unfortunately, I lacked your conviction and, therefore, am an idiot. We'll see if I can change that course.

I agree with PadreBrian, asset allocation is the way to go.

I was mostly in cash last year, which makes up in part for missing the last few bull markets. Put a fair chunk of it into junk bond funds right after the crash, on the theory that the stupidest possible investments would be the biggest beneficiaries of government intervention. I got in just a bit early, but junk bonds turned out to be the investment of the year.

Traditionally asset allocation has been the makeup of a smart investor. I don't agree with that investment strategy is type of market. This type of market is what I call a "Follow your instincts" market. If your gut tells you to move to all cash then do so. I tried to do this in early 2008 but two of my advisers convinced me otherwise and I lost almost $100K in a 6 month stretch in my retirement. On my non retirement portfolio I followed my own instincts and did very well. sdr I believe you made a wise decision. The equities markets are as much if not more manipulated than the RE markets. The day of reckoning for the markets will be here again soon.

I have been a advocate of gold and silver in the past, but truthfully I believe the ETFs, GLD and SLV, have created an avenue for those to be exploited as well. Manipulation is the name of the game. I wish I was related to Bernanke so I could get some inside tips:).

Good news, we are green for the day and my orders get filled at closing prices. May squeak out a nice profit today on top of it all.

I'm a very conservative guy so I just dont have the stomach for all the entry and exits that traders do. I just go with my gut and stick with it until it tells me otherwise. So far it has served me well.

..still waiting for shitybank to go to $10...I'm half way there :) Funny this was a buck a share at the beginning of the year.

Wait, didn't Eugene say we're going to 11? I'm holding him to that.

Meh. I'm thinking about bailing since I went all in March 18th. I'm still thinking it'll be a sideways market for a while, with a little up & down action just to keep things churning.

I'm still guessing an e-o-y rally will happen. It's Jan 2010 I'm worried about crash & burn city.

I'd really like to sneak in under the 1 year long term capital tax gain but I'm afraid I'll be caught out buck naked again if it goes into the dumper before then.

Guess I need to bump up the stops again tonight or at least check on them. Most of the equities I'm holding haven't exactly been going up the last two weeks.

I'm counting on the funds for the final payoff of my mortgage, I can't screw this up. %-/

Assuming I hold till 2010, I'm unloading everything I can outside of 401K/IRA before 10/2010. I'll move the 401K/IRA into cash options at least.

I need to take advantage of the "Booooosh" tax cuts before they expire. Besides I figure the wheels will come off sometime around 12/2010 early 2011.

This of course guarantees there will be a post election cycle bull market, and I'll be kicking myself relentlessly for months. :-(

Always remember about taxes ... if it's a retirement account, you're okay ... if it's not, you'll pay 35-40% in taxes on any gains you make. And, if you bought a house or intend to buy a house this year, capital gains due to the sale might just be enough to kick your AGI above the $8000 tax credit eligibility threshold. You should always do the math.

If you're investing outside 401k/IRA, it may be more profitable to wait out a small correction long stocks till you lock in the LTCG status, than to bail at the first sign of danger.

On the subject of feelings, I fully understand your feelings, but my rational side tells me that the stock market has enough strength left for one more rally. Maybe I'll exit in October.

I wonder how many short term traders are clueless about the tax implications. I like to think most of the Piggington faithful aren't in that eventually stunned group.

lemming alert!

I followed your lead, sdrealtor! At least for my two largest retirement accounts. Hope your investment sense is as sound as your knowledge of real estate markets.

The little short term trading I do, I do in my IRA.

I did quite well last year when the market was going 300 point one way then 300 points the other the next.

I guess were in this together. I dont necessarily beleive a big drop is immenent but rather I dont see any upside in the next few months and would rather lock in my gains. I think we will see a decent drop and then agood re-entry sometime in the next 3 to 6 months. Until then, I'll take my 2 to 3% like a man.

Yep, my feelings as well. And if I'm it turns out I'm wrong, I'll take that like a man as well, as much fun as it would be to blame it on the big ol' bad REALTOR®.

I hope Rich isn't pissed at me though. He's the guy I should really be talking to.

(and no disrespect to you sir, realtor turned financial advisor)

The recession just ended, we had two months of nationwide home price growth, we'll have at least two more, consumer confidence is on the rise, unemployment rate seems to have peaked in June ... (we'll get a clearer picture of that in a week, when they release August unemployment rate.)

The market may be overbought, but to say that there's no upside potential in the next few months, that's just wrong.

I have friends in high places in commercial real estate. That shoe is beginning to drop and hard. Thats what I am expecting. I may be wrong and can deal with it. I made about 25% on my retirement funds this year and am content with that. Like I said, I'm very conservative.

Yeah.

Well, except that I can't stake claim to the friends in high places part.

(just let me know when you want me to stop coat tailin' sdr)

Eugene is that a joke? That might be the silliest thing I have heard all day. The recession has ended? You have been watching way too much TV? Do yourself a favor a read the real facts. Consumer confidence reflects very little if you ask me. It sounds great on paper, but when we get down to the numbers we see that unemployment is fudged, the FDIC is broke and we have yet to see the worst of the mortgage crisis. These few things added to a Goldman Sachs controlled stock market we will see some big changes in the fall. It may not be a hell drop like it was at the end of 2008, but it will definitely be worse in the fall! I think you may be alone with your ideas.

I don't watch TV at all. Time will tell who's wrong and who's right.

I have gone 100% into denial. I know, i should do some allocation, 15% denial, 20% cold reality, 33% blind fear, etc., but I'm just going with my gut. 100% denial, that's where I'm staying. You pepel can do whatever the hell you want, but don't say i didn't warn you. Go long denial, all in!

Eugene, don't take that as an insult. I hope I am proved wrong, but I just don't see the false numbers having the ability to be propped up much longer. Something gotta give!

OK after all this I got to go with what I first said on this thread,

"But to be honest I think it is just what I see on this board that will keep the market zigzagging higher over the next few months"

Too many bears still out there, Got to be a lot on money yet on the sidelines.

If the market is still up come end of October however I will stay on the sidelines myself.

I am with sdr if we do manage to get a 15-20% correction by that time , I will probably go mostly in, But at this point I just don't think that will happen.

I think I remember Sam Zell saying the CRE situation is not nearly as dire as what happened to Residential RE , ( I think he said that CRE deals are much easier to work through and the clean up would be much easier and faster and most CRE owners have the resources to wait it out)

I guess we will see.

sdr,

Don't know if you read this in WSJ on the 24th:
"Bulls of March Look Set to Trade in Their Horns -
Those Who Called Bottom in March Say Prices Look Overvalued". http://online.wsj.com/article/SB12510623...

"Mr. Grantham sees "seven lean years" of a sluggish market ahead, to atone for what the firm believes was a long era of overpriced stocks, according to his newsletter."

After 51% run on S&P 500 from March, a correction is reasonable esp in the worst month of year for stocks, Sep. Market is going up with declining volume, usually a bearish sign.

For those who are like charts, a bullish case can be found here: http://www.ciovaccocapital.com/sys-tmpl/...

Basically the 50 DMA crossed the 200 DMA and slope of 200 DMA turned positive. Emerging markets and copper roared after slope of 200 DMA turned positive in 2003. S&P 500 only went up 69%, so even if we repeat we are only looking at 15% upside from here.

For extensive asset sector breakdown check out
http://ciovaccocapital.com/CCM%20ASD%20A...

I've thoroughly confused myself now, so time to hope and hold.

Some conservative funds with good long-term managers for beginners to consider :

Vanguard Health Care VGHCX
Janus Flexible Bond J JAFIX
Oakmark Eqty Income OAKBX
Sextant International SSIFX
Artisan Intl Value ARTKX
TCW Total Bond TGLMX

And the surprise is HighMark CA Interm Tx-Fr Bond Fid HMITX, up 5% for year, tax free which I did buy in Dec 08.

The contrarian approach usually works well. When people buy I sell and vice versa. Over the last weeks I have lightened up and once the market drops I get in again.

I'm not selling a house, just trying to pay it off. It was bought way back in '96 and this one set me back way more than the pittance I made on the previous one.

I'm with you on trying to stretch it to the LTCG threshold. I've been burned trying to do that in the past however, sometimes it's better to take the tax hit than watch any gains and your principal go down the tubes. BTDT the T shirt fell apart already.

I think I still have some previous losses I can carry over to help anyway.

I'm with Eugene on the possibility of a fall rebound. A lot of maybes have to happen but reality doesn't seem to apply anymore so I'll just decline to fight that trend and see if I can milk it for all it's worth.

Who's running the odds on a major drop because no one will hold over the long Labor Day weekend?

I'm figuring it's 3-1 right now.

equalizer
didnt see it but kinda remembered that Sept is not a good month ofr stocks traditionally. I'm not calling a top here just a time that I want to get out and watch for a while. Things seem too easy right now with the market going up and when things seem too easy my gut tells me they are and that its time for a break.