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RobertCampbell

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Reply with quote  #181 
This is not good.

Survey from GoBankingRates:  57% of all American adults have less than $1,000 in savings.

savings2.jpg  G

RobertCampbell

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Reply with quote  #182 
As per this, the "poor people" shown below are not leaving California.

Homelessness in CA has increased by 30% since 2015.

homeless.jpg 

RobertCampbell

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Reply with quote  #183 

Mortgage rates are surging to the highest level in 7 years

Investors, however, could be preparing for the wrong disaster.

As I have repeatedly illustrated in this thread, a pension crisis is also developing - and that too could be a catalyst to the next real estate downturn.


mortgage rates.jpg 


RobertCampbell

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Reply with quote  #184 
Although rare, being fat can have it's advantages.

Texas Ranger pitcher Bartolo Colon took a 101 MPH line drive directly to his belly and wasn't even fazed.

For those of you who don't follow MLB, B. Colon is an amazing pitcher.  He's 45, been in the league for 21 years, and has a pitching record of 241 wins and only 177 losses.   That's a great career.

RobertCampbell

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Reply with quote  #185 

John Hussman is a stock market guy, and what he said below also relates to real estate cycles.

Markets are markets.

hussman2.png

RobertCampbell

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Reply with quote  #186 
Systems vs Goals

From How to Fail at Almost Everything and Still Win Big - by Scott Adams

+100

If you want to lose body fat, have a system.

If you want to stay in shape, have a system

If you want to be a better investor, have a system

If you want to beat the dealer in blackjack, have a system.

If you want to buy an excellent 2-3 year old used car (with a factory warranty) for only $15,000 -- which is 10-20% lower than you can buy it for at CarMax (which does not negotiate on price) -- have a system.

If you see a woman you're attracted to and want her to know that (without being creepy) - have a system.

Etc, etc ...

Systems increase your odds of success.

systems_vs._goals.png 

RobertCampbell

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Reply with quote  #187 

The Kilauea crater:  2006 compared to May 2018

I've been to the top of this volcano many times.

Here's how it looked in 2006

volcano_2006.png 
Here's how it looks today.  The crater could now be as much as a mile deep.  Wow.

volcano_2018.png 


RobertCampbell

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Reply with quote  #188 
Mortgage Banking Association:  Cash-out refinance activity from 1985 to 2018.

Because it rises during the booms and falls during the busts, "feeling wealthy" is a temporary state of mind.

cash_out_re-fi.png

RobertCampbell

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Reply with quote  #189 

10 year yields are more than 1% higher than global yields - which has been an unsustainable level for the past 20 years.

In my view, global rates will start rising faster than the 10-year. 

global yields.jpg

RobertCampbell

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Reply with quote  #190 
U.S. home ownership rate is near normal again

74% of all people between 55-65 years old own a home. 

78% of all people over 65 years old own a home.

ownership rate.png

RobertCampbell

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Reply with quote  #191 
I've been doing research on risk and money management strategies lately. 

In stock market simulations, the more you use leverage to increase your potential returns, the more likely you are to go broke.

That's because prices fluctuate of course.

Not surprisingly, the same general principle applies to real estate investing.

A friend of mine was recently complaining that he lost $3 million of equity during the 2006-2012 real estate crash, but didn't really lose anything because all the properties were purchased with 100% financing.

I had another view - and explained that he really did lose $3 million because if he had sold in 2006, he would have had $3 million of cash sitting in his bank account.

To a large degree, we all have the free will to determine the outcome of our lives.

Thus, "there are no victims in life, only volunteers" - which is one of my favorite spiritual sayings.

leverage.png

RobertCampbell

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Reply with quote  #192 
Hedge fund manager Dan Loeb:  You cannot overstate the importance of process over outcomes ...

risk management.jpg

RobertCampbell

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Reply with quote  #193 
This explains everything. 

QE model.jpg

RobertCampbell

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Reply with quote  #194 
Who benefits most from higher inflation rates?

Is it rich people or poor people?    

From the Fed, May 15th:

more inflation.jpg

RobertCampbell

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Reply with quote  #195 
If I was buying or refinancing a home right now, I would lock-in a mortgage rate sooner rather than later.

As the chart shows, the trend in rates is up - but there has been a counter-trend move in the last few days, and rates are currently over-bought.



t-chart.png

RobertCampbell

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Reply with quote  #196 
Have you ever heard that the one of the best ways to boost the economy is to cut taxes?

The chart below shows the long-term relationship between corporate tax rates and economic growth.

Not much of a correlation - and another instance of what happens in the real world doesn't quite live up to what we've repeatedly been told.

corp tax rates.jpg 

RobertCampbell

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Reply with quote  #197 
Chuck Yeager was a WWII ace and the first pilot to break the speed of sound in level flight.

He was once going supersonic in an F-104 during a 70 degree climb and he lost power.  His aircraft nosed over, went into a flat spin, and was spinning down to earth like a long metal pipe falling from the sky.

He ultimately had to bail out.

When asked why he couldn't save the plane, Yeager responded "I ran out of speed, altitude, and ideas."

I love this guy.  What a stud.


f104.jpg 

RobertCampbell

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Reply with quote  #198 
May 25, 2018:  Crude oil is currently in a rising trend - however prices are down over 3.5% in today's trading.

As either a short-term or longer-term investment, is this a good time to buy the dip?

crude oil.png

RobertCampbell

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Reply with quote  #199 

Need charts like this to measure the effect of mortgage rates on housing prices (ex-inflation).

Also observe that even though we are seven years into the current upcycle, real housing prices are still roughly 10% lower in 2018 as compared with 2005. 

That's but one reason of many why I believe real estate investors should question the buy and hold strategy.
 

real home prices vs. interest rates.png

RobertCampbell

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Reply with quote  #200 
Great lesson for investors who seek to intelligently manage risk

Geologists believe the activity Kilauea is experiencing at the moment mimics the behavior last seen in 1924 -
94 years ago.

Rare events do occur - and they can be devastating.   

lava flow.jpg

Paul

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Reply with quote  #201 
Red-hot, black swan.
RobertCampbell

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Reply with quote  #202 

From Daniel Kahneman, who won A Nobel Prize for his work in behavior economics:

behavioral_economics.png 


RobertCampbell

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Reply with quote  #203 
May 28, 2018:  Memorial Day

Thinking about guys like this is good for the soul.  

memorial-day-debt.jpg

RobertCampbell

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Reply with quote  #204 
According to Zillow, the median home price in San Jose was $1.26 million in April 2018.

This represented a 26% gain from year ago levels - the highest in the country. 

Not everybody is leaving California.  

zillow home prices.jpg

RobertCampbell

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Reply with quote  #205 
If we use the pre-1990 inflation formula, CPI is currently rising by over 6%.

U.S. government say's its 2.5%. 

inflation2.jpg 
RobertCampbell

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Reply with quote  #206 
Due to Eurozone uncertainty, the probability of 4 Fed rate hikes in 2018 has collapsed in the last week.

fed rate hikes2.jpg 

Jeff

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Reply with quote  #207 

Quote:
Originally Posted by RobertCampbell
Due to Eurozone uncertainty, the probability of 4 Fed rate hikes in 2018 has collapsed in the last week.

fed rate hikes2.jpg 

 

...and?


__________________
Please God, make the second million easier...
RobertCampbell

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Reply with quote  #208 


Jeff, it was simply a market observation which I thought was interesting.

That was a dramatic fall in market expectations.


RobertCampbell

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Reply with quote  #209 
The price trend for Bitcoins is once again down.

It could get real ugly if the April lows are taken out. 

bitcoins8.png

RobertCampbell

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Reply with quote  #210 

Hmm.  I wonder what the Russians plan to do with all this gold?

russian_gold.png 

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