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Schiff - The Coming Housing Collapse


By HousingBoom   Follow   Tue, 12 Mar 2013, 12:12pm PDT   1,539 views   15 comments   Watch (1)   Share   Quote   Permalink   Like (1)   Dislike  

http://www.forbes.com/sites/afontevecchia/2013/03/05/peter-schiff-and-the-coming-housing-collapse-the-fed-instead-of-lehman-owns-the-mortgage-market/

Peter Schiff, the eternal provocateur, suggests the Feds extraordinary support of bond and housing markets will lead to a market crash as interest rates rise, leaving banks, mortgage originators, and lenders stuck with homes and low yielding loans as the economy slows, exacerbating the decline and throwing the economy into a deeper crisis.

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SubOink   befriend   ignore   Tue, 12 Mar 2013, 2:00pm PDT   Share   Quote   Like   Dislike     Comment 1

lol

mell   befriend   ignore   Tue, 12 Mar 2013, 2:03pm PDT   Share   Quote   Like (2)   Dislike     Comment 2

Or, you could look at it this way: If you listened to Schiff and had the balls to short the housing/financial market in 2007/2008 when everybody was laughing in his face, then you would not have to be buying and renting out properties anymore for the rest of your life because you'd be up a cool 10 -100 million $$ by now, like Michael Burry and a few others.

mell   befriend   ignore   Tue, 12 Mar 2013, 2:56pm PDT   Share   Quote   Like   Dislike     Comment 3

There is a difference between trading/timing and economic/sector outlook. That's the reason why Schiff's fund is neither bankrupt nor ultra-rich, but his clients seem to be doing ok, if you actually take the time and check out the handful of funds he is offering on the europac website and their annualized returns (not stellar but definitely stable and above inflation for the mix throughout all funds).

PockyClipsNow   befriend   ignore   Tue, 12 Mar 2013, 3:36pm PDT   Share   Quote   Like   Dislike     Comment 4

I used to like hearing him talk a lot more.

mell   befriend   ignore   Wed, 13 Mar 2013, 12:39am PDT   Share   Quote   Like (1)   Dislike     Comment 5

robertoaribas says

EPIVX trading at 10.70 today, started at 10 in 2010...0.3% A YEAR!

EPLAX is up 11% over 2 years... when the market in general is up what 20%?

EPASX about the same, 5% per year, when the market in general has quadrupled that.

EPIBX is flat for two years.

So what? They are still returns and way above any savings rate you can get and definitely don't prove your hyperbole of "clients losing their ass". A hedge fund's primary mission is to make its client money in good and bad times and always protect (hedge) itself from bankruptcy, so they often underperform the market during a bull run The problem with somebody just tracking the market is that all their gains get wiped out during the next crash (like in 2008), which is often not an option for seniors or generally risk-adverse people. In fact most people would be ok with a savings rate of 3-5%, but they don't get this with ZIRP so they have to gamble in the market and/or invest with hedge funds.

mell   befriend   ignore   Wed, 13 Mar 2013, 2:21am PDT   Share   Quote   Like   Dislike     Comment 6

You don't seem to understand much about hedge funds. Since 2000 his strategy outperformed any spider or other normal market tracking funds, so what you are saying is basically wrong. You are cherry-picking a short period following the crash and we already have established that they have been trailing there. I never said he is a stellar investor, but your claims are simply false. Sure you'd be pissed if you invested in europac right after the crash but on the long run - and that's what hedge funds are for - he is making his clients money. Why would people be keeping invested with him if that weren't so? Investing in countries with a sound money policy and stocks with good yields (plus precious metals & agriculture) makes a lot of sense for a long term strategy for a hedge fund.

mell   befriend   ignore   Wed, 13 Mar 2013, 2:58am PDT   Share   Quote   Like   Dislike     Comment 7

I don't invest in Schiff (as previously said) as I trade my own portfolio and he is not an end of the world guy, he just likes to invest in countries with sound currency policies. Doesn't look like a doomer to me.

Graybox   befriend   ignore   Wed, 13 Mar 2013, 2:59am PDT   Share   Quote   Like   Dislike     Comment 8

http://www.currencynewstrading.com/

Fundamental economic strength
USD 63
EUR 53
CHF 53
CAD 51
JPY 47
AUD 47
NZD 46
GBP 44

gsr   befriend   ignore   Wed, 13 Mar 2013, 12:39pm PDT   Share   Quote   Like   Dislike     Comment 9

AUD and NZD have both gained substantially w.r.t USD during the last few years. Anyone invested on those currencies made a lot of money. I believe Schiff was asking people to do that too.

yup1   befriend   ignore   Wed, 13 Mar 2013, 11:59pm PDT   Share   Quote   Like   Dislike     Comment 10

gsr says

AUD and NZD have both gained substantially w.r.t USD during the last few years. Anyone invested on those currencies made a lot of money. I believe Schiff was asking people to do that too.

AUD vs USD had made about 10% over the past 3 years
NZD vs USD has made about 15% over the past 3 years

Robert Sproul   befriend   ignore   Thu, 14 Mar 2013, 12:39am PDT   Share   Quote   Like   Dislike     Comment 11

Schiff is kind of a cheese-ball for sure, although his address in '06 to the Western Mortgage Bankers Ass. (where he tells them they are soon to be out of work) is classic.
They were about to throw their gaudy fake Rolexes at him.
Schiff, like many of us, failed to foresee the insane extremism of the Fed.
Who knew they would carpet bomb the global landscape with free money, or would continue the swag-fest of financial repression for years and years.

RentingForHalfTheCost   befriend   ignore   Thu, 14 Mar 2013, 1:59am PDT   Share   Quote   Like   Dislike     Comment 12

Robert Sproul says

Schiff, like many of us, failed to foresee the insane extremism of the Fed.

Who knew they would carpet bomb the global landscape with free money, or would continue the swag-fest of financial repression for years and years.

Dead on! We are just kicking the can down the road. Schiff will turn out to be right in the end. We are a bunch of lazy consuming monsters in the global market. Our day will come when the rest of the world will have enough of our bad habits. Now, they need us to keep their markets going, but eventually people will even sabotage their own quality of life for fairness.

gsr   befriend   ignore   Thu, 14 Mar 2013, 2:12am PDT   Share   Quote   Like (1)   Dislike     Comment 13

robertoaribas says

Point missed there, skippy!

The main point he missed was the deflationary effect of the credit crunch. Mike shedlock was right about that. He also missed the money printing ability of other central banks. Other than that, he was quite accurate.

And yes, it is impossible to be wrong on everything all times. Case in point is your desert empire.

mell   befriend   ignore   Thu, 14 Mar 2013, 2:13am PDT   Share   Quote   Like   Dislike     Comment 14

RentingForHalfTheCost says

Now, they need us to keep their markets going, but eventually people will even sabotage their own quality of life for fairness.

Even that is not necessary for them. They can slowly wind down their holdings of US debt while buying gold and other real assets, as some have already started.

Graybox   befriend   ignore   Thu, 14 Mar 2013, 2:27am PDT   Share   Quote   Like   Dislike     Comment 15

yup1 says

AUD vs USD had made about 10% over the past 3 years

NZD vs USD has made about 15% over the past 3 years

The AUD and NZD strength can be greatly attributed to Gold strength. The carry trade being in the 2nd driver position. .10% vrs. 3% (NZD 2.5%)
http://www.fxstreet.com/fundamental/interest-rates-table/

I'm not one who relies on the whore of hope but rather price confirmation. At present gold prices are looking down not up. On the other hand much of the economic data for the USD is strong. Everything market theory is pointing to a lively RE market and price in many areas have confirmed.

Physical RE is not liquid enough for my criteria however their are many REITs index , ETFs and FUNDs that can be bought and traded that pay dividends.
http://etf.stock-encyclopedia.com/category/real-estate-etfs-reits.html

For example;
(RWR) is very near the 52wk high. For those who are of the thought buying RE is not a good investment perhaps a hedge to profit w/o going to the mortgage broker.
http://seekingalpha.com/symbol/rwr

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