This guy has no idea what he is talking about. He said that the reason (emphasis on reason) that gold dropped this year was because it went up for 12 years consecutive prior. He is flat wrong.
He is about the worst market timer in history. You could probably make a LOT of money if you looked up every prediction he makes...and take the other side. Just like Peter Schiff--the one year he was actually "right", his clients still lost 70% of their money.
I like Rogers. The guy is super smart and tends to know what he's talking about and puts his money where his mouth is, but he's not a housing guy. He lives in Singapore for crissake. His time horizon on this call could be 10-15yrs. He's looking at broad macro trends not folks that are picking up starter homes at 4% fixed. If he were to make a call on copper on the other hand, I'd be a little freaked.
brakey wrote:
I like Rogers. The guy is super smart and tends to know what he's talking about and puts his money where his mouth is, but he's not a housing guy. He lives in Singapore for crissake. His time horizon on this call could be 10-15yrs. He's looking at broad macro trends not folks that are picking up starter homes at 4% fixed. If he were to make a call on copper on the other hand, I'd be a little freaked.
I would agree. He's good forecasting commodity trends, but I wouldn't rely on him for much else. He's been anti-U.S. stocks for the last ten yrs.
Economist PhD wrote:
I would agree. He's good forecasting commodity trends, but I wouldn't rely on him for much else. He's been anti-U.S. stocks for the last ten yrs.
He's a self-admitted poor market timer and a long-term macroeconomic genius. Commodities have far outperformed US stocks over 10 years.
indep. of this guy, I do think that some of the housing recovery is artificial in the sense that it is not supported by rising incomes in the U.S. on a broad basis, but rather on foreign investment and hedge fund speculation (many of the bought houses are turned into rentals). It may be that fed money is funding it as well. I know that my claims are very much borne out in the Tampa Bay area, and probably nationally. Why? Because prices are rising too quickly, out of proportion with the overall pace of recovery.
haha.. this thread is ridiculous.
Does anyone here think the housing recovery is NOT artificial???
Long term, housing price need to continue to fall. A growing portion of Americans simply will not have the incomes to feasibly support current housing prices. This will play out of 5-10 years.
I'm not anti-American or anything. Less people are needed to do more things. I'm ardently libertarian but I just don't see how industry/service continues to "fairly"(which is unfortunately a very political term) support a population of +330 million in a near-but-not-completely free-market, capitalist society.
I support and foresee an immediate 30-40% decline in housing prices the catalyst of which would be the ABSOLUTE removal of
1. the mortgage interest rate deduction
2. a free market determination of the term of a mortgage (good-bye 30 year fixed!)
3. a free market determination of interest rates for housing-mortgage products
4. continued unencumbered market clearing transactions (foreclosures)
UNFORTUNATELY, your parents own homes. And they also constitute THE voting block. AND NO POLITICIAN in her right mind would support legislation that would bring us to this eventuality.
economist/fixed-income/email
It would be much tougher to identify him as a clown if he wasn't wearing his bow-tie.
I don't know if it is artificial or not but housing prices here in Silicon Valley hae skyrocketed above the high of 4 years ago. A friend of mine in an average area of Sunnyvale put there 3 bedroom, approx 2,000 sq ft. remodeled house up for sale recently for $1.2m. They sold for $1.436m within a week. I bought my 3 bedroom 2.5 bath 1470 sq ft house for $212,000 in 1994. It was $700k in 2008. Went down to $600,000 about 2 years ago. Now could get $750,000 easy. Not selling though as Almaden Valley area of San jose is great place to live.
Tom Joad wrote:
I don't know if it is artificial or not but housing prices here in Silicon Valley hae skyrocketed above the high of 4 years ago. A friend of mine in an average area of Sunnyvale put there 3 bedroom, approx 2,000 sq ft. remodeled house up for sale recently for $1.2m. They sold for $1.436m within a week. I bought my 3 bedroom 2.5 bath 1470 sq ft house for $212,000 in 1994. It was $700k in 2008. Went down to $600,000 about 2 years ago. Now could get $750,000 easy. Not selling though as Almaden Valley area of San jose is great place to live.
You should sell and get out now with a nice profit before everything collapses in five years. The collapse is going to be absolutely brutal - probably 60% declines.
There are huge differences in this housing market and the 08 bubble. This market is demand driven. Very little was built for years and now a lot of pent up demand is bursting onto the market. Also, banks are tight with their money. People getting loans can pay them. Speculators are in the market, but they are not just making bets. They are responding to real demand.
Economist PhD wrote:
Tom Joad wrote:I don't know if it is artificial or not but housing prices here in Silicon Valley hae skyrocketed above the high of 4 years ago. A friend of mine in an average area of Sunnyvale put there 3 bedroom, approx 2,000 sq ft. remodeled house up for sale recently for $1.2m. They sold for $1.436m within a week. I bought my 3 bedroom 2.5 bath 1470 sq ft house for $212,000 in 1994. It was $700k in 2008. Went down to $600,000 about 2 years ago. Now could get $750,000 easy. Not selling though as Almaden Valley area of San jose is great place to live.
You should sell and get out now with a nice profit before everything collapses in five years. The collapse is going to be absolutely brutal - probably 60% declines.
There is the problem, right there, in a nutshell. Buy a house because you want to live in it, not because you want to make money off of it.
As long as we collectively think about our homes as commodities, we will continue to have a boom and bust real estate market.
that being said, we purposely timed our purchase of a second home to be at the bottom of the trough created by the real estate crash of 08 and are loving the fact that we have a bunch of equity now that we didn't even have to work for.
The housing boom was artifical too. It's based on our view of its worth.
The price rise is due to low interest rates and low inventory.
I don't think it's a real recovery because the rate of home ownership is down.
People aren't selling and foreclosed homes aren't being listed.
Demand isn't really up, it's just higher than supply, which is low.
I agree it isn't a solid recovery because it isn't based on rising incomes.
Ultimately you need a good portion of people to make more money to increase home ownership rate and housing prices.
That would be a real recovery.
I agree with Hooper, with the caveat that cash-rich corporate interests could keep the prices relatively high to the extent that they are willing to purchase existing housing stock, in which case prices would remain high, but the ownership structure would change over time.
In effect, we would see (and in fact are seeing) a consolidation in housing, the same as we have seen in other sectors of the economy and industry, and the economic concept of rents rising to supremacy.