[an]

siamcat, I agree with you, it’s impossible to know anything to a 100% certainty, especially something as complex as the economy. ps, according to your statement, you say you have data that back up your 100% recession claim. However, has the last 6 recession have the same economic factors? I highly doubt even 2 have the exact same economic variables. Also, with all the current economic variables right now, does it match 100% to any of the last 6 recession? If not, then you can’t claim it to be 100% unless you have a crystal ball or just came back from the future. The economy have hundreds if not thousands of variables, it’s already hard enough predicting something with 2-3 variables with any certainty, much less something with thousands of variables. If you say you’re right on your 100% conviction until we bring data. How about you prove to us with your data of all the variables of the economy. So far, I only see you state of 2-3 variables.

[an]

I stopped discussing it with friends who are still bulling/hopeful and have position in RE. I treasure their friendship, so I don’t want to ruin that. Like someone said earlier, giving RE/investment advice is like giving relationship advice, it’s a lose/lose situation, especially if they’re not ready to accept it and you’re pushing it down their throat. I only talk about it to people who are at least open to the idea of RE bubble. As soon as I sense pressure, I back off. No point in making enemies. I’ve been following many townhouse and SFH in Sorrento/Mira Mesa area and I see many chasing the market down too. It’s actually quite fun to watch :).

[an]

1. No, I don’t think we’re heading for a recession. The tech sector is barely starting to recover from the 2001 crash. RE sector is shot now, but oil/gold and foreign are still doing well. Tech is starting to come back and I think will replace the RE sector in keeping this economy above water.
2. Similar to you, I will buy into sectors I think will do well in the next 3-5 years, regardless if there’s hyperinflation or a recession.
3. Cash for a big down payment.
25% Gold
40% Oil
25% Foreign large & small cap
10% Large cap
4. Always, do your own research.
5. I’ve been holding HERO for about week. Doing OK so far. I’ve been watching it and go in and out of it for a year now. It’s growing through acquisition and buying other companies’ lift boats at a discount.

[an]

same can be said about realtor. Their first obligation is to their families. If they don’t sell the house, their families can’t eat. So your argument swing both ways. Realtor didn’t go knock on the buyer’s door and ask them if they wanted to buy.

Let he who has no sin cast the first stone. Don’t be so quick to crucified others when all of us do the same thing, one way or another.

[an]

Since I don’t have data between 50s and 70s, I can confirm my suspicion, but I think that between 68 and 73, the month of inventory probably went down and people might think things are finally picking back up, only to have it crash again around 1973. There’s no way for us to know until we past it. But anyways, you seem to have your mind set that you can do what no one else can claim they could do before, so good luck to you.

greekfire, I vote for #4. Whether we’ll see it in dollar amount or rapid inflation or combination of both, no one knows. But I’m pretty sure we have to revert back to historical mean. The higher you over shoot, the higher the chances of you under shoot on the way back down.

[an]

It’s quite easy to pick out cycle between 80s and now, but tell me how you would pick out a bottom between 50s and 70s? there are a year or 2 of rise, then it resume its down trend.

[an]

I don’t remember where I heard/read the following info, but usually, the stocks that are safe during recessionary period are stocks of company that sell things that people need, regardless of market condition. One example is WFMI, whole food supermarket. It rises throughout the 2000-2001 recession. Another is Johnson & Johnson, it rises a little bit in 2000-2001 and rise a lot between 1970-1973. Same with Merck. So you see, yes, the index goes in cycle just like everything else in the market. However, not everything sector in the market go in the same cycle. I don’t have much data to prove my point for the 69-70 recession period, but I’m pretty sure there are sectors that went up during that recession, just like there are some in the 2000-2001 recession.

[an]

I was 19 in 1999 and just started investing. All of my portfolio was in tech. I made a killing until 2001. I was not aware of any other sector at the time, so I got killed with the .com crash. That was an expensive lesson I learned, also it’s only several k, it was a lot for a 20 year old. I did more research after the crash and learned my lesson. Now, I keep an eye on all sectors. You don’t have to do day trading to make money in a down market, you just have to know which sector to be in at any point in time. After all, I’m still learning and perfecting my skills as life give me more lesson.

[an]

I completely agree with you cabinboy. There are always money to be made in the market, even when the indexes are going down. Big money in the market never exit the market, they just move it from one sector to another, or take some of it out and put it on the sideline for a short while, but it’ll be back in sooner or later. Just look at the last market crash in 2001, if your $ is in tech, you lost big, but if you take that $ and put it in oil, gold, RE, you’ll gain big.

powerseller, last I check, corporate profit is still huge in the oil industry. Also, the telecom industry is finally starting to make a come back too. Large cap stock hasn’t rally as much in this recent upswing to merit a major decline.

[an]

This chart just showed how it’s impossible to time the market. Sure the last two cycle happened pretty smoothly, but look further back than that and you’ll see that there’s really no bottom. Like between the 50s and 70s. If you wait for a true bottom, you might have wasted 20 years.
Also, that chart showed as recently as mid 90s, there’s a dead cat bounce. There are also many dead cat bounce between 50s and 70s.

[an]

If you truly believe this, then wouldn’t it be even better if you put your $ in the market and buy those bear funds that short the market?

[an]

powayseller, you don’t like track home, but you also don’t like living out in the boondocks. Unless you’re ready to buy multi-million dollar custom home, I don’t see how you have much choices in custom homes and in middle of it all.

As for me, Carmel Valley is just one of the easiest area to follow since it has new houses. That’s not where I intend to buy though. For me, Sorrento Valley is much more desirable to me as well as north Mira Mesa, and that where I’ll buy.

[an]

powayseller, according to this link: http://www.housingbubblebust.com/92SoCalRecession.html , San Diego was pretty flat through the last down turn, dropping just 0-3% each year and inflation caught up. His new forecast is price will drop 10%. But for all we know, he could mean 10% every year for the next 2-3 years. Who knows exactly.

[an]

There was an article recently on CNN about 6 figure income. In order to consider yourself truly making 6 figure in San Diego, you have to make around $150k/yr while in Texas, you just have to make $88k/yr. So unless he’s making over $150k, he truly isn’t making 6 figure.

[an]

1) Rent
2) Nope, only 26, so missed the run up by default.
3) N/A
4) My dad told me about his mistake when he bought in 1989. Did my own research and things are out of line with fundamental.
5) Will buy back when time/price is right.
6) N/A
7) I’m only 26, graduated 3-4 years ago, so by the time I saved up some money, things are already out of whack. So I’m priced out for now. I can buy now but i choose not to. I will buy when price make sense compare with rent.

[Author]

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