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stansdParticipant
It must all be a vast right wing conspiracy…this guy is ridiculous…As long as housing in CA is desirable, there will be a shortage…what makes the current market amazing is that prices have gone beyond what is necessary to balance supply and demand even in an environment of scarcity.
The only conclusion you can draw from his nonsense is that we should all wish for prices to remain sky high so that builders will build more so that more people can continue to consume their future financial security now in order to afford a 3BR 500K bungalow in Bonsall.
Stan
stansdParticipantI was once offered a job by the Fed…very glad I didn’t take it, but walking into a vault full of cash was cool.
It’s been awhile since i studied this…Presses aside, the fed does have significant holdings of U.S. treasury securities. If it wants to “mop up” liquidity, it sells them, thus taking cash out of the market.
I assume that creating liquidity is just the opposite, and effectively, the fed can “crank up the presses” by buying treasuries. This would only lead to inflation if the dollars stayed out there-presumably the repos the fed has offered lately will be closed out and the excess liquidity created will be put back into the fed accounts (effectively destorying the cash earlier printed if you will).
I assume someone else here can give a better explanation than that, but that’s my recollection of how it works.
Stan
stansdParticipantI was once offered a job by the Fed…very glad I didn’t take it, but walking into a vault full of cash was cool.
It’s been awhile since i studied this…Presses aside, the fed does have significant holdings of U.S. treasury securities. If it wants to “mop up” liquidity, it sells them, thus taking cash out of the market.
I assume that creating liquidity is just the opposite, and effectively, the fed can “crank up the presses” by buying treasuries. This would only lead to inflation if the dollars stayed out there-presumably the repos the fed has offered lately will be closed out and the excess liquidity created will be put back into the fed accounts (effectively destorying the cash earlier printed if you will).
I assume someone else here can give a better explanation than that, but that’s my recollection of how it works.
Stan
stansdParticipantI was once offered a job by the Fed…very glad I didn’t take it, but walking into a vault full of cash was cool.
It’s been awhile since i studied this…Presses aside, the fed does have significant holdings of U.S. treasury securities. If it wants to “mop up” liquidity, it sells them, thus taking cash out of the market.
I assume that creating liquidity is just the opposite, and effectively, the fed can “crank up the presses” by buying treasuries. This would only lead to inflation if the dollars stayed out there-presumably the repos the fed has offered lately will be closed out and the excess liquidity created will be put back into the fed accounts (effectively destorying the cash earlier printed if you will).
I assume someone else here can give a better explanation than that, but that’s my recollection of how it works.
Stan
stansdParticipantI’ve been thinking about this one over the last couple of days. My conclusion (no surprise here) is that Congress contains a bunch of self-promoting jackasses.
I’m no expert on China, but I’m smart enough to know that the more we publicly pressure them to devalue the yuan, the less likely they are to actually do it. If Congress really wanted to accomplish something rather than pat themselves for toughness on their proverbial backs, they’d quietly use shuttle diplomacy to accomplish their ends.
The last thing the Chinese government wants is to look like it caved to U.S. pressure. Their interests and ours our already aligned-they have an inflation problem, we have a trade deficit. I wish our leaders would shut up and focus on really accomplishing something rather than grandstanding for votes while underminining the very thing they profess to want.
Stan
stansdParticipantI’ve been thinking about this one over the last couple of days. My conclusion (no surprise here) is that Congress contains a bunch of self-promoting jackasses.
I’m no expert on China, but I’m smart enough to know that the more we publicly pressure them to devalue the yuan, the less likely they are to actually do it. If Congress really wanted to accomplish something rather than pat themselves for toughness on their proverbial backs, they’d quietly use shuttle diplomacy to accomplish their ends.
The last thing the Chinese government wants is to look like it caved to U.S. pressure. Their interests and ours our already aligned-they have an inflation problem, we have a trade deficit. I wish our leaders would shut up and focus on really accomplishing something rather than grandstanding for votes while underminining the very thing they profess to want.
Stan
stansdParticipantI’ve been thinking about this one over the last couple of days. My conclusion (no surprise here) is that Congress contains a bunch of self-promoting jackasses.
I’m no expert on China, but I’m smart enough to know that the more we publicly pressure them to devalue the yuan, the less likely they are to actually do it. If Congress really wanted to accomplish something rather than pat themselves for toughness on their proverbial backs, they’d quietly use shuttle diplomacy to accomplish their ends.
The last thing the Chinese government wants is to look like it caved to U.S. pressure. Their interests and ours our already aligned-they have an inflation problem, we have a trade deficit. I wish our leaders would shut up and focus on really accomplishing something rather than grandstanding for votes while underminining the very thing they profess to want.
Stan
stansdParticipantLand Write-downs won’t cause BK-that’s a non-cash charge…the conditions that cause the write-down-falling prices, demand drying up, litigation-that’s a cash drain that can kill.
Stan
stansdParticipantLand Write-downs won’t cause BK-that’s a non-cash charge…the conditions that cause the write-down-falling prices, demand drying up, litigation-that’s a cash drain that can kill.
Stan
stansdParticipantI’m just going on what he told me…he bought another residence, and said that he had 3 years from the purchase of the other residence to sell-I presume it’s related to whether or not you are rolling the gain into a new residence. did a quick web search and found the following:
“If you live in your home for 2 years out of the last 5 years before you sell it, you will qualify for the personal residence exclusion”
I presume after he’s been out for 3 years, he’s no longer in the 2/5 club, and he’d have to pay capital gains on the sale.
Stan
stansdParticipantI’m just going on what he told me…he bought another residence, and said that he had 3 years from the purchase of the other residence to sell-I presume it’s related to whether or not you are rolling the gain into a new residence. did a quick web search and found the following:
“If you live in your home for 2 years out of the last 5 years before you sell it, you will qualify for the personal residence exclusion”
I presume after he’s been out for 3 years, he’s no longer in the 2/5 club, and he’d have to pay capital gains on the sale.
Stan
stansdParticipantI’m noticing the same thing…in the Rancho Bernardo area, I’m seeing lots of houses get listed for sale, and then they’ll wind up on Craiglist or the MLS a couple months later as rentals. Unless rents are up over 10% in the last year, the asking rental rates are often too high by a couple hundred a month as well…I think being a landlord is going to get tough…will be easy to find people looking for rentals, but very tough to find folks with good credit.
The house I’m living in is going to be an interesting case study…owner has to sell by next November or face 70K in Capital gains tax…he’s staring into the teeth of a very, very ugly market, though and is going to have trouble rationalizing that the house he had on the market for 600K 2 years ago can only sell at 450K (which incidentally is what I offered him 6 months ago to buy it).
Stan
stansdParticipantI’m noticing the same thing…in the Rancho Bernardo area, I’m seeing lots of houses get listed for sale, and then they’ll wind up on Craiglist or the MLS a couple months later as rentals. Unless rents are up over 10% in the last year, the asking rental rates are often too high by a couple hundred a month as well…I think being a landlord is going to get tough…will be easy to find people looking for rentals, but very tough to find folks with good credit.
The house I’m living in is going to be an interesting case study…owner has to sell by next November or face 70K in Capital gains tax…he’s staring into the teeth of a very, very ugly market, though and is going to have trouble rationalizing that the house he had on the market for 600K 2 years ago can only sell at 450K (which incidentally is what I offered him 6 months ago to buy it).
Stan
stansdParticipantCashman,
Please post your current rent along with the purchase price of a comparable house. Then take that purchase price * 8% to get approximate annual mortgage payment. We’ll assume your interest savings and equity paydown roughly pay for property tax, mello Roos or HOA, incremental insurance, repairs, and upkeep, and that the market will be flat for the next couple of years.
My Rent is 1,895/Mo or 23K/Year. The house I live in is worth 500K, so I’m saving somewhere around 17K/year by renting.
My bet is that your math is similar.
Stan
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