Down goes the Dow

Ghost of Igloi wrote:

Just saying you are being a pain in the rear. I purchased real estate for cash and it still took a week to close.

Igy

So I'M a pain in the rear because YOU wrote something stupid? Go figure.

So if you didn't purchase your real estate on an open market, how did you buy it? From a friend, a relative?

When I sell stocks, bonds, mutual funds, etc. it typically takes several days for the cash to get to me. That doesn't seem to be much different than your real estate experience.

Just,

You are the stupid one I am afraid.

If you purchase real estate thru a down payment you go a lending approval process as well as re-titling the property. That typically takes thirty days even with stellar credit. On the other hand, a cash real estate transaction takes less time since you only have to do a title search and re-title the property.

I purchased the property in the fall of 2008 a cash deal directly with Hovnanian Homes. The real estate developer was in need of cash and dumping homes.

If you have a taxable account, or non-retirement account, you can request same day settlement rather than the typical T plus three. You will be charged margin interest rates for early payout. This request, however can not be fulfilled from a retirement account.

Nice try though.

Igy

No worries, GOI. We all still have much to learn. I am happy to have been able to help you.

Regarding your invitation to apply for your job down the line, I will have to politely decline. Though I am sure I would have much to offer your clients, my conscience could never allow me to work for an investment firm like yours that would require the amount of churning that they invariably demand of their underlings. Thanks anyway.

Of course real estate is not a liquid asset.

These people are some real morons.

Maserati,

That's OK, you might not pass the securities exams anyway.

Most of our clients are in fee based. We don't churn.

Take care.

Igy

My bad. I was under the impression you worked for Morgan Stanley.

And there's no immediate need for me to pass those exams again anytime soon. :-)

"These people are some real morons."

Glad you said it.

Igy

Maserati,

That's ok.

Igy

None of the "Maserati" posts from 9/17 until this post have been mine, the troll has been hard at work.

As I had suspected, this thread has devolved into a meaningless theater of sockpuppets all controlled by a single entity, the troll (with few obvious exceptions), who has been rampantly hijacking handles.

Too bad, because these are exciting times. I had a feeling that the Fed would do nothing. The gov't keeps repeating that the economy is strong, but I don't agree, nor do I think the Fed agrees. Heck, if it were politically feasible, I think that the Fed would consider DROPPING rates, not raising them.

There is talk circulating that the Fed was responding to MARKET conditions rather than to ECONOMIC conditions, in deciding not to raise rates. If that's the case, it's disastrous IMO.

In any event, people seem to be coming around, the DJIA down 271 so far today, to 16.4k. Good. It seems that 16.xk is a sort of new normal, like we had lots of hovering around 18k for a while; meaning that if a good drop occurs, it will likely occur down from 16.xk

IMO 16.xk represents an absolutely fully-valued market if one believes earnings, and an over-valued one if one doesn't. In any event, that means that I believe that 18k was a grossly over-valued market, run up by people who were making money before exiting, and leaving a bunch of unfortunates holding the bag, now worth only 16.xk.

I do think that there is room to drop significantly below 16.xk. IF 16.xk represents full valuation or better, then a 10-15% correction would leave it at...15k or below (hello K5).

Do I think it will get there? I don't know. I hope it does, I think it should, and I think it can. I am someone who doesn't believe earnings, and think the DJIA should get to 13k in time.

Here's to riding it all out. As with anything, the DJIA could eventually finish in positive territory on the day; most of the action happens at or near open or close.

But of course wrote:

Of course real estate is not a liquid asset.

These people are some real morons.

Who said it was?

Maserati,

I was fairly confident it was not you and a troll; the posts were rude, and I answered in kind.

The markets are very interesting. Federal Reserve inaction has caused people to question not only the past but present policies of global central banks.

I also agree that earnings are declining and market multiples will reflect that going forward.

Certainly, buying on the dip is proving a less effective strategy.

Igy

Gerty wrote:

But of course wrote:

Of course real estate is not a liquid asset.

These people are some real morons.

Who said it was?

You can't read?

By the way, markets way down on Friday afternoon.

Very possible scenario is panic over the week-end and huge drop on Monday.

Perfect!

I can read fine, thank you. I don't think Ghost was saying real estate is liquid. You misinterpreted him.

Ghost, it is my personal belief that the earnings figures are a mess. Executive compensation is often tied to performance, earnings, share price, and they will do, and do do, anything to keep them up.

They can't continue these mechanisms forever. Add to this that I think that consumer demand around the globe may actually be softening somewhat (just my anecdotal feeling, having been many places over many years, and knowing many people in many different places), and you have a double-whammy on corporate bottom lines. Cost cutting is an option to a point, but much of it was already done post-2008. Fortune 500's are still rationalizing and clearing out dead wood, but they have resorted to nickel-and-dime tactics like changing vacation day policies, and having retail level personnel pay for their own uniforms.

Important details, for sure, but hardly big, important initiatives. It's like they're fighting over the scraps now, keeping share price up at all costs. Not good.

I am content to continue to watch. I am also on the cusp of another real estate investment, another lucky opportunity that has presented itself, along with some savvy negotiating on my part. I am fortunate to be in a position to take advantage of it. I could very well lose on it, I intend to hold it for 5-10 years.

Dow down 315 now, nearing close...

Gerty wrote:

I can read fine, thank you. I don't think Ghost was saying real estate is liquid. You misinterpreted him.

Of course he didn't. I never said he did. You really can't read!

Maserati: By definition, liquid assets are easily converted to cash without any loss of value.. Anything that is 'short' or 'leveraged' does not qualify.

True, but there is no guarantee against loss of value. Therefore they do not meet the criteria for liquid assets.

Iggy: Liquid assets are anything that can be sold in the open market, they are funds that are actively traded

Just saying replies: Oh my. And I thought you were a professional investment advisor.

Real estate cannot be sold on the open market?!

Pointing Out the Obvious: Maser, you are right and have proven it

Now maser has plausible denial for just about anything he says. Ever.

Anyway, I wish the lot of you would just register.

I'd say the fed didn't tighten not because they are worried about the us economy, which is fine, but because the fed has become the central banker to the world, and they didn't want to throw everyone else into a pickle. And now people are saying "well if the fed is worried, so should I. "

Or it's just the gAwdam program traders again.

Maserati,

I believe your analysis is correct and is supported by recent data. It is also supported by historical data. Earnings revert to a mean. There is the theory that we are in a "new age" and margins can continue to improve. This is just revisionism that typically proves to be wrong. On top of all of this is the question of market valuation which I have discussed extensively. At some point the Bullish view point will prove to be fantasy or worse yet hokum.

I am out of the office next week on business, so I will miss some of the hourly market fun.

I am leaving work to go mow my lawn.

Have a good weekend.

igy

Of course wrote:

Gerty wrote:

I can read fine, thank you. I don't think Ghost was saying real estate is liquid. You misinterpreted him.

Of course he didn't. I never said he did. You really can't read!

Maserati: By definition, liquid assets are easily converted to cash without any loss of value.. Anything that is 'short' or 'leveraged' does not qualify.

True, but there is no guarantee against loss of value. Therefore they do not meet the criteria for liquid assets.

Iggy: Liquid assets are anything that can be sold in the open market, they are funds that are actively traded

Just saying replies: Oh my. And I thought you were a professional investment advisor.

Real estate cannot be sold on the open market?!

Pointing Out the Obvious: Maser, you are right and have proven it

You actually never named who did. And I sure don't see it in those quotes.

I assume you are the troll Maserati spoke of. You got me to respond to you, so well done I guess. I hope you're happy. Now perhaps you will let this thread return to an adult conversation. Good night.

John Hussman has some interesting comments on the Fed decision in his weekly commentary:

http://www.hussmanfunds.com/wmc/wmc150921.htm

The Real Igy