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powayseller
ParticipantHas anyone bought Rydex Inverse Funds? They even have an inverse Dow fund, that returns 200% of the opposite of the Dow.
ParticipantI talked to a guy in his 50’s, who said his house is going to be his retirement. He wants to sell it in 5 years. We’ve probably got millions of Americans who spent all their equity (as Steve explained), got the bigger loans to prove it, and are thinking the appreciation will continue to fund their retirement. We’re going to have a wave of bankruptcies and very poor elderly.
ParticipantGold is linked to inflation. Chris Johnston has done research on this, and it was in one of his newsletters (subscription only). I believe we will see very high inflation. Eric Jantzen, venture capitalist and dot com millionaire founded the itulip.com site in 1999 to warn people of the internet bubble. Read his KaPoom Theory, about inflation and deflation. He was one of the authors of the just -released Wiley book The Bubble Economy, which was just released and shipped to me yesterday. His charts is from the disinflation and deflation leading to the Great Depression, and he believes that gold will be the only store of value when Poom hits.
ParticipantYes, CDs are a sucker’s bet for the long term. But in a global recession, it’s a winner’s bet.
I sold my house in 1/06 and my equities in 3/06, and went in to capital preservation mode. My plan is to get back into equities as the depth of the recession in late 07 or sometime in 08, and back into housing at the depth of the collapse in 2010 – 2012. There are times to grow your money, and times to just hold on to what you’ve got.
ParticipantA good friend of mine, a realtor, said now is a good time to buy, because months supply is over 6, meaning it’s a buyer’s market. There you go, it’s a good time to buy! (Never mind that prices will keep dropping as months supply rises from today’s 10 to 15, 20, even 25 or beyond, and prices will keep dropping.)
ParticipantInvoking God to help you win a big hand at the poker table is tacky ,and unlikely to work. Studies have shown that praying for patients after surgery had zero effect on the patient’s outcome, so I doubt the statue trick will work. Besides, if there is a God (as I believe), wouldn’t She want the prices of houses to go down, so that people could afford to buy them with less than 30% of income with a 30 year fixed mortgage? If these people had half a brain, they’d realize that a fair and benevolent God wants housing prices to drop in half, to restore equilibrium and give the next generation a chance to live in California.
ParticipantCDs and Treasury notes are the best way I know of to preserve capital in anticipation of a big stock market bust during the upcoming recession. I will definitely get back in equities when the economy starts turning around, when the S&P500 is 30% off today’s high.
By the way, market timing has worked quite well for me. I completely missed the tech stock bubble.
ParticipantMy son’s Poway elementary school has had declining enrollment for several years in a row. This year we reduced our kindergarten classes by one, from 4 to 3. Our parents are really old, and it’s rare to see a parent under the age of 35.
ParticipantI believe Rich is a very good CFP. However, I am not sure of the majority of them. I am concerned about claims from people like privatebanker, who is promoting CFP in general, without any data to back it up. While Rich will be a very good CFP since he is forward looking and has so much knowledge, what is the track record of the average CFP?
When we asked Chris Johnston about his track record, he promptly posted it. I’ve been open about my investments since this forum started, almost one year ago. Yet when I ask privatebanker about his investments, he calls me myopic, because his returns are too bad, probably. His response is a poor reflection on the profession, when you have a CFP going around insulting people who ask for his performance data.
ParticipantOk, 3 times I asked privatebanker about the returns he provides for his clients, and what he holds in his own accounts. He wrote “I’ve always said, “THIS IS THE LAST PLACE YOU WOULD WANT TO RECEIVE INVESTMENT ADVICE!” I’ve seen some very naive recommendations. This is a housing site! Go see a CFP!”
I ask what is the typical return that a CFP gets for his clients. He says I have myopic vision. I ask what is the rate of return he gets for his clients, and he says each client’s needs is unique. I say no more run around and word games, and he says I’m weird.
privatebanker, I call your bluff. What are your investments and what are you recommending for your clients? I want to follow your progress, so we on piggington can decide if a CFP is wiser than we are.
ParticipantPerry Chase, thanks for your kind comments all along. If you like Roubini, you may also like economist Dean Baker . Check out his The Bursting of the Housing Bubble and the Upcoming Recession. Have you read itulip.com?
ParticipantSteve is right; the commute looks easy on a map. Try it once, then decide. Picture yourself going 5 miles in 20 minutes, every single morning, every single night. That’s on the freeway. Imagine yourself waiting for 1-2 minutes at traffic lights just a few blocks apart. If you *love* sitting in your car and are *very patient* in rush hour traffic, then you could tolerate it. My dentist’s receptionist left Vista because her kids were so scared to get beaten up in the school bathroom, that they would “hold it” all day. Have you ever heard of such a thing? Afraid of going into the school bathroom? She said the schools were very very bad.
There’s a reason Vista is cheaper.
When we moved here, I thought the same of Oceanside and Rancho Penasquitos as you do of Vista. Maybe someone can corroborate if Oceanside property values have gone up since the city started its downtown improvements, and if RP property values increased after coastal access improved via the 56.
Participantjepsd, is there a way to find out how many people used equity from their homes to invest in the stock market? I’ve read this before: MEW was used for consumption, but also for buying second homes and stocks.
I have a question for the stock market bulls: do you believe we are in a housing bubble?
Everybody who believes in a housing bubble also is waiting for the stock market to go down: International Monetary Fund, Barry Ritholtz, Nouriel Roubini, Calculated Risk, Tim Iacono, iTulip (Eric Jantzen), Daily Reckoning, Christian Science Monitor, Yamamoto Forecast, Bill Fleckenstein, I could go on an on. All these people, as well as many media stories, link the bust of the US housing bubble with a busting stock market and some of these guys go so far to forecast a recession.
So it seems that if you are bullish on stocks, you don’t believe this is a housing bubble, or you think housing won’t drop significantly, or you don’t realize that housing is linked to the economy.
Could you please explain why you think the stock market will go up, and your view on the housing market?
ParticipantAgain, please tell us the return you have provided for your clients in the last 10 years, as well as the investments you hold now in your own portfolio. Please spare us the run-around about how each client’s situation is unique. You come around and say you are so superior to me, CFPs are so superior in their performance, but you offer no proof.
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