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The New Pat Net -Impeccable Timing


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2015 Jan 21, 4:16pm   8,966 views  26 comments

by smaulgld   ➕follow (4)   💰tip   ignore  

San Francisco tech companies with no earnings and multi billion dollar market caps are partially responsible for the massive increase in housing prices in the bay area.

When the stock market finally collapses there will be massive layoffs and the housing market will nose dive.

Patnet will chronicle it all.

#housing

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1   The Original Bankster   2015 Jan 21, 6:21pm  

we will all become welfare recipients.

it will be wonderful.

2   hanera   2015 Jan 21, 7:17pm  

Smaulgld

I see you parallel the start of pat-net with impending RE rally with change to new pat-net with impending collapse of tech stocks.

3   indigenous   2015 Jan 21, 9:23pm  

You are implying soon?

4   ChapulinColorado   2015 Jan 21, 10:14pm  

smaulgld says

When the stock market finally collapses

5   ChapulinColorado   2015 Jan 21, 10:30pm  

The Original Bankster says

we will all become welfare recipients.

it will be wonderful.













6   smaulgld   2015 Jan 22, 1:03am  

indigenous says

You are implying soon?

Hard to say but if you pulled a list of sf tech companies and compared their sales, earnings and employees you'd see that profit per employee is near non existent.
Wall Street won't reward that forever

7   indigenous   2015 Jan 22, 8:16am  

Where is Darlag?

Suppose that depends on the Yellin put and how long the stock market can remain irrational.

8   CDon   2015 Jan 22, 11:21am  

smaulgld says

San Francisco tech companies with no earnings and multi billion dollar market caps are partially responsible for the massive increase in housing prices in the bay area.

When the stock market finally collapses there will be massive layoffs and the housing market will nose dive.

Patnet will chronicle it all.

Wow - strong words there... I guess for the "whats the best investment" there really is no rest for the weary - its a lifelong quest - its never over.

But what about the renter/ potential homeowner who gets terrified by all he reads here and wonders "I don't want to rent forever - when can I just buy and move on with my life"?

http://us.spindices.com/indices/real-estate/sp-case-shiller-10-city-composite-home-price-index

Far as I can tell, Case Shiller SF bottomed approx. 5 years ago at 119

It was at 173 (June 2013) when you first arrived and warned of a crash.

Today, its at 196...

So what for that poor guy? After 5+ years of renting and hoping, should he double down, waiting for nominal prices to smash below the 2009 levels so as to justify all this additional waiting? Or is this too extreme in your guestimate?

Put another way, while we all know that nominal prices can decline, is CS 118 off the table? If he decides to heed your warning and wait some more, what sort of nominal CS figure can he expect to see?

9   smaulgld   2015 Jan 22, 11:26am  

CDon- SF is unlike just about every real estate market in the world. It is similar only to, but perhaps more extreme than London, Hong Kong and New York.
Wall Street Hong Kong and London benefit from being thriving profitable financial centers, San Francisco profits from a temporary period of producing a crop of innovative and yet unprofitable companies.
SF is a boom bust town and this round is very similar to the dot com, gold rush and other booms and busts the city has endured.

10   CDon   2015 Jan 22, 12:04pm  

smaulgld says

SF is a boom bust town and this round is very similar to the dot com, gold rush and other booms and busts the city has endured.

I understand. And to your point, we see that .com bust in the data as SF dropped approx. 7% from Apr 2001 to Jan 2002.

http://us.spindices.com/indices/real-estate/sp-case-shiller-10-city-composite-home-price-index

-7% in 10 months is nothing to sneeze at - not by the investor, or the homeowner - so long as you got the timing pretty close.

Still, if that's all we see now, we only get down to low 180s which isn't much solace for the renter/ potential buyer who heeded your first warning at 173 (saying nothing of the bears of yesteryear who first warned him at 118 5 years ago).

So back to the question, I guess that's it then? Another 7% drop is the target on our CS chart? For the investor with impeccable timing, that's not bad.

But for the patnetter who wants to move on w life is this the target then? The lack of impeccable timing has thusfar hosed him pretty badly. Is your target here so severe a drop as to justify the additional waiting?

Again, just cause you are putting it out there, how do these strong words translate to the CS chart. Are you looking at -5% nominally? -20% nominally? Real declines/Nominal Increases? Just curious as to your best guess.

11   smaulgld   2015 Jan 22, 12:17pm  

CDon says

Again, just cause you are putting it out there, how do these strong words translate to the CS chart. Are you looking at -5% nominally? -20% nominally? Real declines/Nominal Increases? Just curious as to your best guess.

The problem with SF is that it lives on the edge- an earthquake could wipe out the whole place, a technology bust could do the same. It's hard to figure out what is "normal" for SF because everything from the people, the climate the job market is far from normal and every bubble is different, so the dotcom bubble may not be instructive.

I think any one that wants certainty and to "get on with their life" should move or accept the thrill of the uncertainty of living in SF

12   smaulgld   2015 Jan 22, 12:34pm  

ChapulinColorado says

When the stock market finally collapses

Not chicken little-stock market crashes are something that happens from time to time. The impact would be felt far more in SF than elsewhere

13   indigenous   2015 Jan 22, 1:44pm  

smaulgld says

The problem with SF is that it lives on the edge

Another problem that does not often get mentioned is the government creating an artificial scarcity on land thus driving the prices up or rent control or building regulations.

14   smaulgld   2015 Jan 22, 1:46pm  

indigenous says

smaulgld says

The problem with SF is that it lives on the edge

Another problem that does not often get mentioned is the government creating an artificial scarcity on land thus driving the prices up or rent control or building regulations.

That's true its hard to build new construction in SF BUT since it is already the most densely populated city in the US its hard to find much available space to build new construction anyway

15   indigenous   2015 Jan 22, 1:53pm  

Not even in the top 50 in the world:

http://en.wikipedia.org/wiki/List_of_cities_proper_by_population_density

and 20th in the US:

http://en.wikipedia.org/wiki/List_of_United_States_cities_by_population_density

I'm thinking the government has a lot to do with false dearth

16   smaulgld   2015 Jan 22, 2:51pm  

indigenous says

Not even in the top 50 in the world:

http://en.wikipedia.org/wiki/List_of_cities_proper_by_population_density

and 20th in the US:

http://en.wikipedia.org/wiki/List_of_United_States_cities_by_population_density

I'm thinking the government has a lot to do with false dearth

I should have mentioned most densely populated of major cities.
Tiny towns on the list you linked to like
Guttenberg on the list with 10,000 people and Kaiser New York with 4700 are not major cities

17   smaulgld   2015 Jan 22, 2:59pm  

Take Manhattan out of the equation with its 60-100 story apartments and San Francisco is BY Far the most densely populated major city as it has very few high rises just homes smashed up against each other

18   Shaman   2015 Jan 22, 3:12pm  

I had an EBT card once, when I got hurt and was out on medical for a few months. They put my disability pay on it, only way to get it.
So not everyone with EBT is a welfare lifer.

19   indigenous   2015 Jan 22, 4:17pm  

smaulgld says

Take Manhattan out of the equation with its 60-100 story apartments and San Francisco is BY Far the most densely populated major city as it has very few high rises just homes smashed up against each other

Sounds like the Bay Area has restricted high rises...

20   smaulgld   2015 Jan 22, 4:49pm  

indigenous says

smaulgld says

Take Manhattan out of the equation with its 60-100 story apartments and San Francisco is BY Far the most densely populated major city as it has very few high rises just homes smashed up against each other

Sounds like the Bay Area has restricted high rises...

Which means they have little means to alleviate any housing shortage

21   indigenous   2015 Jan 22, 4:50pm  

smaulgld says

Which means they have little means to alleviate any housing shortage

Your government at work, making life better...

22   smaulgld   2015 Jan 22, 4:52pm  

indigenous says

smaulgld says

Which means they have little means to alleviate any housing shortage

The other issue SF faces is there are lots of people in rent controlled apartments which means this housing stock is not subject to normal market dictates and removes it from the market.

As a result there are lot of evictions that make for great class warfare theater

23   indigenous   2015 Jan 22, 4:54pm  

smaulgld says

ent controlled apartments

Rent control is great for people taking more space than they would otherwise because the price is so low. It is also great because it gives the landlord no motivation to do maintenance.

24   indigenous   2015 Jan 22, 5:56pm  

Unfortunately politicians listen to Krugman...

25   anonymous   2018 Feb 7, 11:04am  

Topping. As we all know, SF has busted in the past, and will certainly go busto again someday. Yet, 3 years later, we can now say that this was definitely NOT impeccable timing.
26   WookieMan   2018 Feb 7, 11:27am  

anon_d06f9 says
Topping. As we all know, SF has busted in the past, and will certainly go busto again someday. Yet, 3 years later, we can now say that this was definitely NOT impeccable timing.


Who cares honestly? He made an estimate on something happening and wasn't correct. If everyone here is so good at timing markets, why the hell are you posting here? You should be in the Mediterranean Sea off the cost of Greece in your yacht, banging models because you've timed the markets so well and made shitloads of cash.

I appreciate he had the balls to make a call on something. He even took the 20 seconds to create a username (shit uploaded an avatar too) unlike a lot of others and now has this call tied to him. People can hate on each other all they want, but I personally don't understand the payoff.

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