[poorgradstudent]

I think there’s more new names in general lately, probably a sign of more people interested in the real estate bubble, specifically local impact, as the mainstream media continues reporting on it. Most of the people who stick around range from moderately to extremely bearish, while newbies probably run the full spectrum.

[poorgradstudent]

I think there’s more new names in general lately, probably a sign of more people interested in the real estate bubble, specifically local impact, as the mainstream media continues reporting on it. Most of the people who stick around range from moderately to extremely bearish, while newbies probably run the full spectrum.

[poorgradstudent]

Housing prices are going to fall considerably either way. Most people on this board view it as a good thing, or minimally a necessary thing.

I completely agree that Presidents get too much credit for the economy that falls during their reigns. The actual impact of policies, while not trivial, is modest compared to larger cycles that are impossible to control.

Democrats traditionally raise taxes on the rich and ultrarich and lower them on the middle class (40-150k annual household income). The tax rates during the Clinton years are arguably the stereotypical “Democrat” tax rates, those now more in line with “Republican” tax rates, specifically the lower capital gains tax. Overall the differences are pretty subtle, except for those at the top of the food chain (and I’ve gotten the impression a couple members of this board actually are up there). It’s hard to project the impact of such a reversion on the housing market; one might guess it would prop up the lower end market somewhat and slightly exacerbate the decline in high end homes.

Also, and not trivially, we’re still roughly 17 months away from the next election. A lot can change between now and then. Terrorist attacks, wars, natural disasters, to name a few major events, on top of natural market fluctuations. So feel free to speculate all you want, but right now, it is purely speculation.

[poorgradstudent]

Housing prices are going to fall considerably either way. Most people on this board view it as a good thing, or minimally a necessary thing.

I completely agree that Presidents get too much credit for the economy that falls during their reigns. The actual impact of policies, while not trivial, is modest compared to larger cycles that are impossible to control.

Democrats traditionally raise taxes on the rich and ultrarich and lower them on the middle class (40-150k annual household income). The tax rates during the Clinton years are arguably the stereotypical “Democrat” tax rates, those now more in line with “Republican” tax rates, specifically the lower capital gains tax. Overall the differences are pretty subtle, except for those at the top of the food chain (and I’ve gotten the impression a couple members of this board actually are up there). It’s hard to project the impact of such a reversion on the housing market; one might guess it would prop up the lower end market somewhat and slightly exacerbate the decline in high end homes.

Also, and not trivially, we’re still roughly 17 months away from the next election. A lot can change between now and then. Terrorist attacks, wars, natural disasters, to name a few major events, on top of natural market fluctuations. So feel free to speculate all you want, but right now, it is purely speculation.

[poorgradstudent]

The most likely scenario in my mind is this bull will continue to run for the short term, although the summer is often pretty stagnant. The fundamentals look sound, especially if you project earnings to continue to grow at the rate they have been in recent years (which I don’t, but projecting is a dicey buisiness).

A slowing economy will hit earnings sooner or later, which will eventually end this bull run. Once people stop expecting earnings to keep going up, they start valuing stocks differently. Putting an exact timepoint on it is impossible, but I don’t think this next quarter’s earnings will be bad enough to spook the horses.

At this point in the cycle the most prudent course of action seems to be defensive, “boring” stocks along with some cash and foreign equities that are less tied to the US economy. It’s early to be shorting the market as a whole, although there are always overheated individual stocks that could be worth a look.

[poorgradstudent]

The most likely scenario in my mind is this bull will continue to run for the short term, although the summer is often pretty stagnant. The fundamentals look sound, especially if you project earnings to continue to grow at the rate they have been in recent years (which I don’t, but projecting is a dicey buisiness).

A slowing economy will hit earnings sooner or later, which will eventually end this bull run. Once people stop expecting earnings to keep going up, they start valuing stocks differently. Putting an exact timepoint on it is impossible, but I don’t think this next quarter’s earnings will be bad enough to spook the horses.

At this point in the cycle the most prudent course of action seems to be defensive, “boring” stocks along with some cash and foreign equities that are less tied to the US economy. It’s early to be shorting the market as a whole, although there are always overheated individual stocks that could be worth a look.

[poorgradstudent]

Builders slashed prices to move inventory. Buyers, faced with the choice of a resale home, or a new home at a lower price, “shockingly” chose the new homes.

To me the key takeaway is the slashing of prices, not the increase in sales. A decrease in price is expected to yield an increase in demand by the laws of economics.

[poorgradstudent]

Builders slashed prices to move inventory. Buyers, faced with the choice of a resale home, or a new home at a lower price, “shockingly” chose the new homes.

To me the key takeaway is the slashing of prices, not the increase in sales. A decrease in price is expected to yield an increase in demand by the laws of economics.

[poorgradstudent]

Mark Twain was also a notoriously awful investor. Luckily he was a brilliant and popular author who could always write another book to make up for what he lost in bad investments 😉

[poorgradstudent]

Mark Twain was also a notoriously awful investor. Luckily he was a brilliant and popular author who could always write another book to make up for what he lost in bad investments 😉

[poorgradstudent]

“So how can an individual know which stock to trade and make money doing it?”
The one advantage individuals have is they are (almost always) way smaller than the big firms, so we can buy significant (to us) shares of stocks without moving the price of said stock. Being nimble definitely has its advantages. It also allows us to invest in small and micro cap stocks, which over time typically outperform the S&P 500, admittedly with more risk.

Of course, it’s easy to make money in a bull market. High risk, high beta stocks tend to outperform in both directions. The true test of traders probably comes during bear markets.

I guess the other advantage individual investors can have over institutions is a willingness to carry cash when the market is overinflated and be patient. Mutual funds are paid to buy stocks, not just carry cash, hence the saying “cash is trash”.

I imagine being a professional trader is very challenging. I’ve been able to do fairly well with my modest stack of “mad money” for fun, but I haven’t been doing it that long, so I may just have been lucky or simply buying higher beta stocks.

[poorgradstudent]

“So how can an individual know which stock to trade and make money doing it?”
The one advantage individuals have is they are (almost always) way smaller than the big firms, so we can buy significant (to us) shares of stocks without moving the price of said stock. Being nimble definitely has its advantages. It also allows us to invest in small and micro cap stocks, which over time typically outperform the S&P 500, admittedly with more risk.

Of course, it’s easy to make money in a bull market. High risk, high beta stocks tend to outperform in both directions. The true test of traders probably comes during bear markets.

I guess the other advantage individual investors can have over institutions is a willingness to carry cash when the market is overinflated and be patient. Mutual funds are paid to buy stocks, not just carry cash, hence the saying “cash is trash”.

I imagine being a professional trader is very challenging. I’ve been able to do fairly well with my modest stack of “mad money” for fun, but I haven’t been doing it that long, so I may just have been lucky or simply buying higher beta stocks.

[poorgradstudent]

Thanks for the link. God, am I the only one who finds this place a little … ugly? I guess it’s just too modern for my personal tastes. On the other hand, it would be fantastic for entertaining in, so it may have been built with that in mind?

Oh, and what’s with the blood-red stain on the deck in the 3rd picture? It’s a little creepy.

[poorgradstudent]

I find this whole thing fascinating. The take away seems to be that most of the potential buyers were bargain hunting, and were dissapointed there weren’t better bargains to be had. The sellers seem to be unhappy at the prices they got, which generally seem to be roughly at current market conditions.

[poorgradstudent]

The article I read said that the PPI came in at expectations (0.7%), which was lower than last month (1.0%).

“”It looks like inflation is very tamed,” said Kim Caughey, equity research analyst at Fort Pitt Capital Group, adding that the PPI bodes well for next week’s consumer price index and makes a rate increase appear less likely.”

I was pretty surprised to see the market gain back almost all of Thursday’s losses. I guess it was the combination of the mild inflation numbers and a bounce back effect.

It looks like inflation may be slowing as the economy slows. If it does, there could be a rate cut, which the market always loves, a little too much.

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