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May 24, 2022 | Money Illusion

                         By pumping up the money supply and forcing interest rates to record lows, artificially inflated U.S. asset prices are like a circus mirror …                  … people are tricked into believing they are wealthier than they really are.  

May 15, 2022 | Human Nature Is Amazing

Everybody wants to buy real estate when it is up 100% – and nobody wants to buy when it’s down 50%. If you want to kick-butt and out-perform the pack as a real estate investor, you can’t do what everybody else does. You have to sell greed and buy fear – and not the other […]

April 29, 2022 | The Fed: To Hike – or Not to Hike in May

    To fight inflation, the Fed hiked short-term interest rates by 0.25% in March – and they are expected to hike rates by another 0.5% when the Fed meets next on May 3rd.   Does the Fed keep raising rates because inflation is at 8.5% and rising? Or does the Fed stop raising rates […]

April 22, 2022 | Second Order Thinking

Second order thinking is essential if you want to be a superior investor. Most real estate investors, however, only consider the first order effects of economic events – such as a downturn in housing prices. Conversely not spending time to consider the second order effects of market events can result in you missing out on […]

April 18, 2022 | Savers from 18 to 85 Are Getting Totally Screwed

  The Fed has been screwing savors for decades – but with inflation at 8.5% and rising, now it’s a real negative-yield bloodbath. Savers use to get 5% or 6% in a Certificate of Deposit 20 years ago.  With a $1 million, you could make $50,000 to $60,000 in interest per year without touching the […]

April 13, 2022 | The Rising Price of a Sandwich

  The above illustration shows how much more expensive sandwiches have become in the last 12 months ending March 2022. Those percentages are based on actual price changes that have occurred compared to a year ago. Yet according to the government inflation figures from the Bureau of Labor Statistics, the cost of food in the […]

April 12, 2022 | Will 5% Mortgage Rates Tank the Housing Market?

  The average 30-year fixed mortgage rate spiked to 5.02% on April 5th, the highest since November 2018. Rates have gone from 2.73% to over 5% since August 2021.  That’s a record percentage rate increase over an eight month period.  Monthly mortgage payments have abruptly jumped up by 25.8%. And rates are likely to go […]

April 3, 2022 | “Success is Just One Long Street Fight”

Life would be a whole lot easier if someone just gave us $1 million, but unfortunately the chance of that happening is, well, probably zero. Instead, making a $1 million is going require brains, guts, and the will to never give up – and like it or not, it’s going to be one long street […]

March 30, 2022 | Deja Vu All Over Again?

Home prices have rocketed to record highs – and signs point to more gains. Property owners have been dancing to a bull market for 10 years now – and when the music finally stops, many are going to find themselves without a chair. Housing prices could plummet during the next downturn – so this is […]

March 18, 2022 | The Fed’s Balance Sheet: $8.8 Trillion and Rising

Fed La-La-Land Fed Chairman Ben Bernanke in 2010:  I think we would like to bring the balance sheet back to something…under a trillion dollars… Ron Paul: A trillion dollars? Bernanke. Or less, yes. Real World The Fed’s balance sheet was $8.8 trillion on March 9, 2022 – more than double what is was in March […]

February 24, 2022 | Inflation and Growth in Home Prices at 40-Year Highs

  U.S. inflation soared to 7.5% in January – a 40-year high.  (Source:  BLS) U.S. home prices soared 18.5% year-over-year in December – an all-time high.  (Source: CoreLogic) Because housing prices are currently appreciating faster than the rate of inflation – 18.5% vs 7.5% – homes are still a good place for investment capital. Mortgage […]

April 30, 2020 | Does the Housing Market Still Have Legs?

The coronavirus outbreak has sparked a tsunami of concern about what impact it will have on the U.S. economy and its housing markets. – and rightfully so. Recent surveys show that approximately half the service firms and over one third of manufacturers have already shut down – either partially or completely – and more firms […]

July 27, 2019 | Must See Charts on Falling Interest Rates!

What have I learned in the past year that genuinely surprised me? The Fed Funds futures market currently is pricing in a 73% chance of a Fed rate cut in July – and a 95.8% chance of two or more rate cuts in 2019.  This was illustrated in the July Timing Letter. Conventional wisdom is that Fed […]

October 25, 2018 | Housing Affordability Falls to a 10 Year Low

Rising mortgage rates and rising housing prices have pushed home affordability to the lowest levels we’ve seen in 10 years – both nationally and in California. For California, the California Association of Realtors (CAR) reported that housing affordability fell to 26% in Q2 2018 – a level also not seen since 2008. In response to […]

October 12, 2018 | San Francisco Housing Bubble – UPDATE!

[Excerpted from Sept 2108 Timing Letter] “The two best traits for a good investor,” says Nobel Laureate Robert Shiller, “are to have a deep appreciation of history and a good understanding of psychology.” To prove it, look at the above chart. Now ask yourself this:  “How many times in history have you seen markets rise […]

July 22, 2018 | Must See Chart! Are We Nearing a Housing Market Peak?

[From July 15, 2018 Timing Letter] The chart below is from the Wall Street Journal (June 2018). With mortgage rates rising, can home prices keep rising at 7% if wages are only rising at half that rate? I’m pretty sure the answer is “no” however the variable is timing. “It takes five years to learn […]

April 18, 2018 | “Why You Should Question the Buy-And-Hold Strategy … In Both Stocks and Real Estate”

I recently came across this 12 year chart of the Vietnamese Stock Market – which showed how it took investors 11 years to get back to breakeven after the market’s 2007 peak.     The purpose of investment is to make capital grow and protect it from loss – as I’ve been focusing on in […]

February 17, 2018 | Look at Where the Puck is Going, Not Where It’s At

Throughout history, investors tend to make the same mistakes over and over again – and to their great detriment. I talked about this at my Feb 10, 2018 seminar.  One of their biggest mistakes deals with “forecasting,” where investors get out their ruler and start extrapolating trends of the  recent past into the future. Mortgage rates, for example, were in a downtrend for most of 2017. That seems […]

December 17, 2017 | “The Most Important Word in Real Estate” – Bruce Norris

My friend and fellow real estate analyst Bruce Norris spoke at the San Diego Creative Investors Association on December 12th – which I eagerly attended. “Stay Put or Cash Out of California Real Estate?” was the topic. For those of you who are not familiar with Mr. Norris, he has been an active (and very successful) real estate […]

October 31, 2017 | Would Higher Interest Rates Derail Today’s Housing Boom?

A key question for investors, including those who participate in real estate markets, is:   “Where are interest rates headed?” There is a great deal of speculation about who President Trump’s pick for the next Fed chair is going to be – and he recently confirmed that he is “close to deciding. ” At a Capitol […]

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