patrick.net

Call it Crazy says

REpro says

Call it Crazy says

Instead of Spanish as a second language, maybe you people in CA better bone up on your Mandarin.....

Actually it is more serious than you think.

I bet it is... Any chance they are concerned that we won't pay them back and might default on the debt we owe them, so this is why they are stocking up on Gold and buying hard assets here??

Every heavy industrial economy comes to the point, where financial crisis is triggered by oversupply. US don’t have to default on bonds, just create super inflation and all interest owned will devaluate to ‘peanut’.

Send thousands to die in Vietnam in a supposed war on communism, put billions into the Cold War using the same battle cry, then give communist China tax incentives to buy up our property, while becoming so in debt to them that they wouldn't need a war to take us over. Hypocritical sick little plutocracy we live in.

Hyperinflation is a dangerous game. It can severely undermine the middle class in this country. OTOH, selling paper title of properties in the US to foreigners at super-inflated prices, then buy the same properties back for peanuts, is a tried and true method of dollar repatriation and elimination of purchasing power that the foreigners had:

Mistsubishi bought the Rockerfeller Center building for $4B in 1989, then sold it back for nothing. $4B was real money 25 years ago! The first Iraq War only cost $60B in 1990.

Daimler-Benz paid $37B for Chrysler, then again sold it back for nothing. That's the equivalent of giving a decade's worth of cars shipped to the US for free!

Do you really think the Chindians buying SFBA real estate today will fair better?

Reality says

Do you really think the Chindians buying SFBA real estate today will fair better?

In a word, yes.

One is sure: rich bankers and the rest of 1% have always plans ready to implement, how to milk people from excessive money.

rooemoore says

Reality says

Do you really think the Chindians buying SFBA real estate today will fair better?

In a word, yes.

"This time, it's different"

Four most dangerous words in investing.

2015 housing will be ....

Reality says

Hyperinflation is a dangerous game

Hyperinflation is an act of desperation. However, well-engineered and executed high inflation is nothing else as financial TOOL and is far safer than deflation.
Last time US had high inflation was in ‘70th, (12%-14%)

REpro says

Reality says

Hyperinflation is a dangerous game

Hyperinflation is an act of desperation. However, well-engineered and executed high inflation is nothing else than financial TOOL and is far safer than deflation.

Last time US had high inflation was in ‘70th, (12%-14%)

The result was stagflation, just like what are having now.

BTW, don't think the 70's experience was safe. Apparently the whole system came close enough to collapsing to necessitate crisis planning such as committees on government continuity, which apparently was in doubt in the minds of some elite. At present, if a double-digit inflation take place like in the late 1970's, the Volcker solution of raising interest rate over 15% like he did in 1980-81 would bankrupt the country, simply due to much higher debt to GDP ratio now compared to back then.

hrhjuliet says

Where do you think we are going to end up in 2015?

If history is any indication, 2016 would be the top of the housing market. That means we should see some more appreciation in the next couple of years. I know it's hard for some to grasp, but it is what it is. However, the depth of the next housing correction would not be as severe as the 2009-2011 one.

I had an unfair advantage because I was buying properties at the courthouse steps during the financial crisis. Investors were buying properties at 75%-80% FMV all day long at the steps. When the foreclosure inventory started to dry up in late 2011 and early 2012 at the courthouse steps, that was an indication that the housing market would get hot in the next 4-6 months. I gave the warning to Patnet readers, but it felt on deaf ears. People only like to hear what it would fit their preconceived notion unfortunately.

The law of supply and demand trumps everyone's opinion and prediction. If you pay attention to the Bay Area housing market, there's hardly any distressed sales now. Any distressed sales that come up are immediately locked-in before they even hit the market. The typical buyers have no chance of buying these at a discount.

Unlike flippers and banks, who are okay with cutting prices because they have to move their inventory. Regular sellers, on the other hand, are reluctant to cut their wishing price. Unfortunately, the current housing market is dominated by regular sales. Coupled this with loans generated since 2009 have performed flawlessly, where is the housing inventory coming from? If not from regular sales or new construction, where else?

Have you been to open houses lately? How many buyers are Asians? How many of these buyers are loaded with funny money? At this pace, I'm afraid that our kids would eventually be servitude to the Chinese landlords in the Bay Area.

Edvard2 almost missed the boat. His tone of voice changed quite a bit since he bought his house in Spring 2012. Otherwise, he would still be a Bay Area housing hater now. It's unfortunate that there are so much misinformed advice on Patnet about the housing market. On the positive side, some Patnet readers got off the sidelines and did well. So congrats to those.

I had lunch with BMWman in early 2013. Great guy and very reasonable in his analysis. He sees the world for what it is and not what he wanted it to be. He bought an older house in Santa Clara for $775k in May 2013. Again, someone on here gave him ill advise when he shared his purchase journey and his problematic next door neighbor's son. Thus, he requested Patrick to delete a couple of his threads on these topics, packed his bag and moved on with his life. That was a big loss for the Patnet community IMO.

Anyways, night night.

Bmwmans million dollar dream house quickly turned nightmare before he could even move in, when he realized the neighbors kid was psycho. Hopefully, he is ok. But I fear the worst,,,,,

errc says

Bmwmans million dollar dream house quickly turned nightmare before he could even move in, when he realized the neighbors kid was psycho. Hopefully, he is ok. But I fear the worst,,,,,

I'm sure he's fine. He's probably been busy catching up on all the deferred maintenance left by the previous owner. As I remember he also had a dream of a speaker building workshop.

It would be nice if he'd check in once in a while though.

Not just BMW, what happened to Troy, RayAmerica?

bubblesitter says

Not just BMW, what happened to Troy, RayAmerica?

Troy became Bill.

Reality says

Troy became Bill.

Yeah, what happened to Bill? he posts very thorough and analytical.

bubblesitter says

Reality says

Troy became Bill.

Yeah, what happened to Bill? he posts very thorough and analytical.

I think he finally recognized the follies in Georgism, and is intellectually honest enough to avoid bamboozling people with nonsense after the new realization. It's a little like Karl Marx could never finish Das Kapital after the first volume, after he learned that his Labor Theory of Value assumption was wrong, and his proposed social theory and solutions could not reconcile with the reality of Values being Subjective.

E-man says

Have you been to open houses lately? How many buyers are Asians? How many of these buyers are loaded with funny money?

There's lots and lots of Chinese and Indians who came as students, got jobs in tech, worked, and buy houses now. So just because someone is speaking a foreign language doesn't mean they are newly-arrived holders of funny money. Yes, there are some newly-arrived rich people buying houses with cash, and more than 5 years ago. But don't assume that all foreign-language speakers are newly arrived.

SiO2 says

There's lots and lots of Chinese and Indians who came as students, got jobs in tech, worked, and buy houses now.

I was working with one to make newly purchased house ready for rent. He still lives in low quality apt. close to his job. He did not purchased house for cash flow (Cap rate no more than 3%). He purchased just to follow the crowd and to impress family back in his country.

Reality says

rooemoore says

Reality says

Do you really think the Chindians buying SFBA real estate today will fair better?

In a word, yes.

"This time, it's different"

Four most dangerous words in investing.

You are comparing Rockefeller ctr and Chrysler with SFBA real estate?

Instead of comparing apples to oranges - the list of foreigners buying American companies and real estate is long with results that run the gamut - how about just looking as SFBA real estate performance over the past 160 years?

rooemoore says

You are comparing Rockefeller ctr and Chrysler with SFBA real estate?

Those were the most infamous examples of how foreigners got taken to the cleaners for purchasing US bubble assets. Around the same time when the Rockefeller Center building was purchased by Mitsubishi, Japanese individuals also bought in the late 80's and early 90's a lot of Hawaii real estate, which soon took a nose dive that did not recover until the latest bubble this past decade.

Instead of comparing apples to oranges - the list of foreigners buying American companies and real estate is long with results that run the gamut - how about just looking as SFBA real estate performance over the past 160 years?

The Dow Jones average looks beautiful over 110 years. However, just don't think the shoeshine boy buying in 1929 would profit nicely.

New Renter says

errc says

Bmwmans million dollar dream house quickly turned nightmare before he could even move in, when he realized the neighbors kid was psycho. Hopefully, he is ok. But I fear the worst,,,,,

I'm sure he's fine. He's probably been busy catching up on all the deferred maintenance left by the previous owner. As I remember he also had a dream of a speaker building workshop.

It would be nice if he'd check in once in a while though.

Of course he may also have a bad case of buyers remorse...

Reality says

The Dow Jones average looks beautiful over 110 years. However, just don't think the shoeshine boy buying in 1929 would profit nicely.

Can we stay on SFBA real estate? Most of the foreign investors that I said would be fine with their purchases bought a couple of years ago. Perhaps the reason they aren't buying now is because prices are too high. That is why I said they would be fine. Most didn't overpay.

rooemoore says

Reality says

The Dow Jones average looks beautiful over 110 years. However, just don't think the shoeshine boy buying in 1929 would profit nicely.

Can we stay on SFBA real estate? Most of the foreign investors that I said would be fine with their purchases bought a couple of years ago. Perhaps the reason they aren't buying now is because prices are too high. That is why I said they would be fine. Most didn't overpay.

I was talking the ones buying in SFBA now . . . as some other members of the forum reporting seeing many of them at recent open houses.

Reality says

The Dow Jones average looks beautiful over 110 years. However, just don't think the shoeshine boy buying in 1929 would profit nicely.

The shoe shine boy would not have lost money as long as he held the stock seventeen years or more according to the Merrill Lynch reps who used to present 401k plans.(I know, I know...)

FunTime says

Reality says

The Dow Jones average looks beautiful over 110 years. However, just don't think the shoeshine boy buying in 1929 would profit nicely.

The shoe shine boy would not have lost money as long as he held the stock seventeen years or more according to the Merrill Lynch reps who used to present 401k plans.(I know, I know...)

To put 17 years in perspective, in soviet union, the maximum penalty besides the death penalty was 15 years in prison...