patrick.net

@stereotomy, tell me more about the hurricane windfall please.

GNL says

stereotomy, tell me more about the hurricane windfall please.

When Volker raised 30 year Treasury rates above 15% back in the early 80's in a desperate bid to it kill inflation, it set up a dynamic where insurance companies could buy high-yielding long bonds to finance their operations. As rates declined over the next 30 years, they reaped the double windfall of high yields and massive capital appreciation.

Now, they are stuck with low-yield paper bought during the ZIRP regime. They earn no interest and their bonds are all underwater now that interest rates are rising - they're doubly fucked.

AmericanKulak says

She said they are leaving as soon as the lease is up after their first year here.

Here's my Tale of Two Cousins

Sibling retirees from high-tax northeast retired on the West Coast of Florida in recent years.

Sibling #1 & spouse on fixed incomes public school teacher career pensions. Bought their forever home near Ft Meyers area. With a mortgage? I dunno, that's too personal for me to ask. Shared on social media hurricane photos battening down hatches. Fled back to N.E. to un-retire last year. Did they sell the Florida home? I didn't ask.

Sibling #2 affluent retired international arms merchant (no kidding). Cashed out of the appreciated N.E. home. Renting near sibling's (former) residence on Florida west coast. Enjoying not paying state income tax as a Floridian. Traveling the World with spouse. Life is good.

B.A.C.A.H. says

Traveling the World with spouse. Life is good.

I feel that I would have to be anchored in US RE, even if I didn’t live in it. Re-entry after world travel with ever appreciating prices could be problematic. It’s an asset class that you probably need in your portfolio.

stereotomy says

FYI - It's a REALLY bad time to consider an actuary position.

My kid is studying to be an actuary with a BS in computer science. What preparations should be done?

gabbar says

stereotomy says

FYI - It's a REALLY bad time to consider an actuary position.

My kid is studying to be an actuary with a BS in computer science. What preparations should be done?

I guess I'm wrong:

https://www.onetonline.org/link/summary/15-2011.00

That website is awesome - now you know where the HR flunkies get their materials. Have your kid check it out - it's great for building resumes.

DemocratsAreTotallyFucked says

YUP.

It'll be another quarter or two before stubborn homeloaners trying to sell really "get it". The smart money started getting out last year.

A million Chinese and South American millionaires don't want to buy Aunt Ethel's 3bed/2bath in the Villages

Can't speak for the nation but Florida went apeshit building apartment buildings during COVID, and all the builders had to post bonds for completion post-Financial Crisis by law. Those who think they'd rent them are now competing with brand new (USB straight in the wall) apartments for their used homes. Meanwhile, Snowbirds slammed with 5 and even 6 figure assessments and a doubling of condo fees are trying to dump or rent, too.

What did boomers think would happen when everybody retired in the same 5-10 year timeframe?

Just wait until they start taking money out their 401ks and IRAs after a few years due to inflation/medical bills. Tens of millions will all do it. What goes up because of people putting money away...

DemocratsAreTotallyFucked says

They can't apply for a loan in my area. There's nothing for sale. So of course loan applications would plummet from the super low interest rate times. That's the way I look at it. Also rates aren't that much lower.

Just had a broker do a CMA on my house yesterday. She walked through. She's a top agent in the area. Looking to get a price to give my mom to be fair to her. Story is the broker is generally a listing agent. She said there is nothing. And there's no prospects upcoming. This is the type of person that knows every home owner in town.

All our old people retired and moved or died already. IL is unique in that the exodus already happened a decade ago. I'm interested to see how NY and CA do. I think CO is in trouble too. The Boomers that ski will push it, but they're hitting the age where they'll die on the slopes or hiking. They're nearing move to the beach years and warmer weather like AZ. CO is certainly overpriced.

AmericanKulak says

Just wait until they start taking money out their 401ks and IRAs after a few years due to inflation/medical bills. Tens of millions will all do it. What goes up because of people putting money away...

I'm taking $40,000 out for the build. I'm in a unique situation (as usual). I'll have no income (on paper) this year. $0. So I'll pull some Roth gains tax free (seasoned 5 years) and 401k at 10% penalty. I'm guessing it will average out to 5-6% penalty and no federal taxes. Would be the penalty and if you toss it on my wife's income at the end it would be about 42%. I just have to file taxes differently. Getting my money out at this point in life is actually smart. Building a $630k home with well under the 3x's income rule.

I'll be blunt, cancer is a thing and it's hit every male on both sides of my family (my parents). Hoping to hit 70, but the odds aren't the greatest genetically. It's not like you can just work out and cancer doesn't happen. Just lost a friend at 47 to throat cancer. No smoking. There's really nothing you can do.

My wife and kids will have multiple houses. My mom and MIL both have hefty cash amounts. I personally expect nothing, but my kids will be taken care of and get extremely solid inheritances. My kids will likely get $200k each between in laws and my mom. Maybe $500k So in years I make no money I'm pulling it out before they change rules.

The other thing with boomers is those that could retire already have. 59-1/2 to pull from 401k. Early 60's for SS. Boomers are what 68-80ish? None of my parents friends work. If they still work it will be till death. So the selling of homes in most places won't pick up. Low inventory means lower loan applications. I think the boomer sell off already flashed by us.

Illinois pension debt is 270%, the worst in the nation, worse than California. 20% of Illinois budget goes to pensions as of today, right now.

The Illinois pension system is over 50% funded by the annual state budget, not from investments

The total pension underfunding is worse in Cali, but that's only because California has a lot more people.

AmericanKulak says

Illinois pension debt is 270%, the worst in the nation, worse than California. 20% of Illinois budget goes to pensions as of today, right now.

You're right. We lost population. You have to factor in Chicago though. I forget the acronym, but everything is funded just fine outside of Chicago. They have their own pension systems set up through unions and other bull shit. That's being honest. My mom's pension is 100% funded. She was a teacher in the suburbs.

IL is a tricky state to outsiders. Not a dig. Chicago fucks up our entire economics. We live in a town of 2,200 and my wife will make $400k. Property taxes are $3,300ish. Basically what I'm saying is Chicago fucks up the state. It's bad on paper, but those of us outside the city do just fine. Hence why there's no houses for sale where I live. They get bought in a day.

Chicago Police, Fire and Teachers are what makes that percentage so high. They didn't fully fund it for decades. It really is a lost cause. My two Chicago cop friends are out when they hit the earliest retirement age and work for a suburban department. I'd like to recruit them to my town. Would be great people.

IMRF is fully funded though in the state. It's why I say get out of cities and why Chicago is a shit hole. All cities are shit holes. Too much bribing and bull shit. Happens in small towns, but we're talking $100 and not $1M+

stereotomy says

I guess I'm wrong:

https://www.onetonline.org/link/summary/15-2011.00

That website is awesome - now you know where the HR flunkies get their materials. Have your kid check it out - it's great for building resumes.

THANK YOU. I did forward the link. You are right, this site is a good resource for HR flunkies.
Also, he got an offer to intern as an aspiring actuary with an insurance company yesterday. Going to interview with a very top level investment company soon!

gabbar says

stereotomy says

I guess I'm wrong:

https://www.onetonline.org/link/summary/15-2011.00

That website is awesome - now you know where the HR flunkies get their materials. Have your kid check it out - it's great for building resumes.

THANK YOU. I did forward the link. You are right, this site is a good resource for HR flunkies.
Also, he got an offer to intern as an aspiring with an insurance company yesterday. Going to interview with a very top level investment company soon!

Best of luck to your son!

AmericanKulak says

Just wait until they start taking money out their 401ks and IRAs after a few years due to inflation/medical bills. Tens of millions will all do it. What goes up because of people putting money away...

What they will try first is vote for more of medicare paying for all their shit, for whomever promises them they won't make them pay a dime, while pushing more and more debt onto the youth. The American youth is too stupid due to indoctrination atm but it will eventually wear off like in Germany, where the majority of first time voters vote for the AFD, i.e. no wars, no illegal immigrants and no more subsidizing the old at the cost of the youth/taxpayers. We need the same happening here. The other day I listened to a senior brag that he had 7 knee surgeries and didn't pay a dime out of pocket. Yeah, go home boomer.

mell says

I listened to a senior brag that he had 7 knee surgeries and didn't pay a dime out of pocket. Yeah, go home boomer.

He can't, he has a bum knee. Might need that free medical transportation.

HeadSet says

mell says

I listened to a senior brag that he had 7 knee surgeries and didn't pay a dime out of pocket. Yeah, go home boomer.

He can't, he has a bum knee. Might need that free medical transportation.

Haha well he was working out quite freely, so it was likely some sort of bionic replacement.

Speaking of houses, I hope @AD is okay after that hurricane blew through.

@AD definitely needs to check in when he can.

SoTex says

Speaking of houses, I hope AD is okay after that hurricane blew through.

Didn't he say he was leaving? My sister was in Orlando, a conference. I think it's more of a rain event than damaging winds. I don't really watch news so I'm talking blindly. Anything in the last 15-20 years should be able to manage a cat 3. Roofing not included. You shouldn't die is my point.

Probably no internet, cell phone or power would be my guess. I'd think he's fine.

Dunno, didn't notice anything except a gap in posts. I saw some drone footage that was pretty bad but it only covered 1-2 blocks away from the coast. He's 2 miles in so probably fine.

https://www.cnn.com/2024/09/30/economy/housing-market-home-sales-redfin-report/index.html

A new report illustrates just how stuck the housing market is

Just 2.5% of homes in the US changed hands this year in the first eight months, the lowest turnover rate in at least 30 years, according an analysis by Redfin.

The latest data from the real estate brokerage underscores just how much the housing market has stalled in 2024 as Americans faced a toxic combination of record-high home prices and elevated mortgage rates, creating one of the most unaffordable housing markets in a generation.

zzyzzx says

creating one of the most unaffordable housing markets in a generation.

It's always been unaffordable. Mortgages used to only be 7 years. Then 10. Then 15 - 20.

At the height of the Japanese bubble they were offering 100 year multigenerational mortgages. Ppl are making noises here about 40 year mortgages.

You don't 'own' a home with that. You are just a tenant with stronger rights than one under a lease-option.

You don't own it even if you pay it off. Because property tax. Fail to pay that long enough and see what happens.

DemocratsAreTotallyFucked says

It's always been unaffordable. Mortgages used to only be 7 years

Back in the 1980's my grandma told me they got their Long Island house during the Great Depression on a 7 year mortgage.

B.A.C.A.H. says

Back in the 1980's my grandma told me they got their Long Island house during the Great Depression on a 7 year mortgage.

My great-grandparents got their house in the 40s on a 10 year. $5k house in San Francisco.