January 20, 2014

Bits Bucket for January 20, 2014

Post off-topic ideas, links, and Craigslist finds here.




RSS feed

272 Comments »

Comment by tresho
2014-01-20 03:11:48

Cleveland: House-flipper released from prison early to do community service

CLEVELAND, Ohio – A Florida man sentenced in May to prison for illegally flipping dilapidated homes asked for and was granted an early release from prison Friday.

But after hearing Cuyahoga County Common Pleas Court Judge Richard McMonagle’s list of rules and requirements, Blaine Murphy respectfully asked to be returned to prison. McMonagle, however, released Murphy to serve the remainder of his 18-month prison term from a fixed-up home he owns on Beyerle Road in the city’s Slavic Village neighborhood.

According to prosecutors, Murphy’s crimes involved buying hundreds of rundown homes sight-unseen from banks. Then, instead of fixing them up, he would sell, or “flip,” them to another buyer at a profit.

In doing so, he would ignore code violations and fail to pay taxes. The homes would often sit vacant, costing the city money, contributing to neighborhood decay and acting as magnets for crime.

Prosecutors say Murphy’s crimes occurred in multiple states between 2005-10 and included the quick sale of 235 homes in Cleveland and other Cuyahoga County suburbs.

McMonagle doled out a two-year sentence in May after Murphy had pleaded guilty to charges of fraud and tampering with records.

Assistant Cuyahoga County Prosecutor Greg Mussman pointed out the lasting community damage but said the county didn’t oppose Murphy’s release so long as he remained in Cleveland for the remainder of his sentence.

In a release after the hearing, Mussman said “You saw the real Blaine Murphy in there. “He would rather go back to prison than live and work in the neighborhood where he did so much damage.”

Frank Ford, who serves as chair of the Vacant and Abandoned Property Action Council (VAPAC), said that damage caused by the more-than 300 properties Murphy touched is ongoing. He said some of his properties appear to be vacant and back taxes are owed on some of them.

Comment by azdude02
2014-01-20 06:48:31

“As we’re going to see, money in our modern banking system has the ability to multiply through bank lending. Each time a loan is made, money is created. Out of where, you may ask? Out of thin air. Most people would attribute this feat only to the Federal Reserve, but in actuality, every bank does it with every loan they make.

This process can continue over and over as the money is redeposited into banks to be loaned again. If this process continues to its maximum, the original $100 can grow into $1000. Notice that this relationship between the initial deposit and the maximum growth is a factor of the inverse of the reserve ratio. A reserve ratio of 10% allows a deposit to grow into 10 times as much money. What we have just described is the “money multiplier” model. An initial sum of money has “multiplied” through bank lending.”

Comment by Blue Skye
2014-01-20 08:36:14

Our banking system is not working on a 10% reserve requirement. Far from it.

Comment by azdude02
2014-01-20 08:39:31

what is it currently? My guess might be 1% these days.

(Comments wont nest below this level)
Comment by suite Joey blue eyes (csn&y superfan)
2014-01-20 09:37:28

Capital rules are set depending on the type of asset. It is based on the liquidity and the official rules are pretty legalistic. Google “basel iii”. This stuff it’s written by lawyers, so naturally the idea is to help insiders and make things opaque to “the people”.

 
 
 
Comment by oxide
2014-01-20 13:56:27

‘Each time a loan is made, money is created. Out of where, you may ask? Out of thin air.”

Closer to the truth is what Darrell in Phoenix used to say, the money is created as debt. My theory is that money is created out future labor. My mortgage certainly was. The system worked well as long as we can labor reasonably fast enough to fill with labor the holes that debt dug. But we went far out of sync years ago, either by government debt, or by credit default swaps.

Comment by AbsoluteBeginner
2014-01-20 20:36:52

‘My theory is that money is created out future labor.’

I see like that. It is a confidence that the dollars, the currency, will get you goods and/or services. A suitcase of paper dollars or electronic dollars in an account are only a proxy of future purchase potential. The musical chairs ala velocity of money gets a disturbing shock when people start waking up to what money is. That is the black swan I envision, maybe in form of a bank run, from the common people, when they realize all this confidence is hoping that things just stay in check long enough for them to cash out of the stock market, sell their house, get out of dodge, etc. Individual choices, but imagine a macroscopic convergence when people start realizing they have been gamed to buy when Madison Avenue told them to buy.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2014-01-20 23:57:20

‘My theory is that money is created out future labor.’

It’s when the value of the future labor needed to pay off a ginormous loan greatly exceeds potential future earnings that this principle fails. For instance, how many California households are going to earn enough net of living expenses, taxes, etc over their future working years to pay off a $500K+ mortgage plus interest, taxes, insurance, HOA, Mello-Roos, maintenance, etc etc etc over the future life of their mortgage?

Good luck with that plan!

 
Comment by Mugsy
2014-01-21 02:16:59

I still learn lots of great stuff here! Every buble is a learning opportunity for me.

Let the bubbles bubble! :)

 
 
 
 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 11:22:29

OK, so why doesn’t the bank foreclose on all these properties? If they’re dilapidated, then the city can condemn them, and take them through eminent domain. If the guy wants to go back to prison, then all he has to do is fail to live in the specified house. These geniuses are really not solving anything with their creative sentencing, especially when said sentencing is probably not even within legal guidelines.

But foremost, why did state and federal regulators fail to squash the lending practices that enabled this dude to do this in the first place? Finger, meet point.

Comment by Housing Analyst
2014-01-20 11:25:08

Why? Because the foreclosure delays across the country is the default mechanism for moratorium.

 
Comment by tresho
2014-01-20 14:59:16

If they’re dilapidated, then the city can condemn them, and take them through eminent domain.
I suspect the city doesn’t have the resources to either care for or demolish the wrecks. At least if there is an owner, the city has some recourse to pick the owner’s pocket - of course, assuming the owner can be found, and that he has some $ in those pockets. I can only assume that is the reason behind cities like Cleveland tolerating so many abandoned & useless housing units, which serve only as places to stash dead bodies & run meth factories.

 
Comment by tj
2014-01-20 15:54:39

If they’re dilapidated, then the city can condemn them, and take them through eminent domain.

google ‘eminent domain abuse’ and see what comes up. families that have owned their homes for generations are losing them to governments via eminent domain. government says it needs the property to get higher tax revenue. maybe put in a strip mall. as if that isn’t disgusting enough, it actually backfires on the genius bureaucrats many times and actually costs the government more money. of course then they’ll need to take even more private property.

 
 
 
Comment by Housing Analyst
2014-01-20 04:48:58

Redmond, OR Housing Prices Sink 15% Year Over Year; Inventory Up 50%

http://www.movoto.com/redmond-or/market-trends/

Comment by azdude02
2014-01-20 06:42:37

“It started with goldsmiths. As early bankers, they initially provided safekeeping services, making a profit from vault storage fees for gold and coins deposited with them. People would redeem their “deposit receipts” whenever they needed gold or coins to purchase something, and physically take the gold or coins to the seller who, in turn, would deposit them for safekeeping, often with the same banker. Everyone soon found that it was a lot easier simply to use the deposit receipts directly as a means of payment. These receipts, which became known as notes, were acceptable as money since whoever held them could go to the banker and exchange them for metallic money.

“Then, bankers discovered that they could make loans merely by giving their promises to pay, or bank notes, to borrowers. In this way, banks began to create money. More notes could be issued than the gold and coin on hand because only a portion of the notes outstanding would be presented for payment at any one time. Enough metallic money had to be kept on hand, of course, to redeem whatever volume of notes was presented for payment.

“Transaction deposits are the modern counterpart of bank notes. It was a small step from printing notes to making book entries crediting deposits of borrowers, which the borrowers in turn could ‘spend’ by writing checks, thereby ‘printing’ their own money.”

Comment by Housing Analyst
2014-01-20 07:57:11

Yes. The borrower is slave to the lender.

 
Comment by tj
2014-01-20 08:03:32

It started with goldsmiths. As early bankers, they initially provided safekeeping services, making a profit from vault storage fees for gold and coins deposited with them.

would you rather pay storage fees or allow fractional banking?

Comment by azdude02
2014-01-20 08:31:03

well obviously it would depend how much the fee was. people pay to store their sh@t in storage units so why not have some piece of mind your money is there when you need it? where is germanie’s gold?

(Comments wont nest below this level)
Comment by tj
2014-01-20 08:41:21

well obviously it would depend how much the fee was.

people would always think the fee was too much.

people pay to store their sh@t in storage units so why not have some piece of mind your money is there when you need it?

storage units aren’t very secure. they are often raided depending on the security. the more security, the more you pay.

where is germanie’s gold?

who would trust the US government?

 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 11:31:52

The Federal Reserve banks store all the gold owned by the United States. That ain’t free. It gets paid for through the profits of the Federal Reserve bank (aka, “interest”).

 
 
 
 
Comment by rms
2014-01-20 10:03:16

“Redmond, OR Housing Prices…”

Redmond, OR is a pretty place although I prefer Madras, which is 20-minutes north. My question is where do these people work to enable them to buy a 3/2 ranch for $225K or more?

Comment by Housing Analyst
2014-01-20 10:06:35

I have friends near Crooked River who bought in 1998. They admitted they can’t sell today for what they paid then.

Prices were massively inflated out there by 1998.

 
 
 
Comment by overpaid government contractor
2014-01-20 05:03:09

SOUPER BOWL!

Comment by jose canusi
2014-01-20 06:17:37

P-MAN!

Comment by overpaid government contractor
2014-01-20 06:26:22

i got another 10k of equity yesterday and will get 50k more when we win the souper bowl in 2 weeks

Comment by jose canusi
2014-01-20 06:41:13

Awesome! Because Denver’s gonna win.

(Comments wont nest below this level)
Comment by overpaid government contractor
2014-01-20 06:59:30

it’s no coincidence that both teams in this year’s souper bowl are from cities with legal weed

all metro denver papa john’s online orders are 50 percent off today thanks to peyton

 
Comment by MacBeth
2014-01-20 08:05:55

So in other words, the obesity rate of those living in weedy Colorado and weedy Washington might be expected to climb.

 
Comment by azdude02
2014-01-20 08:28:48

I saved 5 bucks on a cardboard pizza thx to peyton.

 
Comment by overpaid government contractor
2014-01-20 09:30:00

cheese sticks with bacon and banana peppers are the bomb

 
Comment by In Colorado
2014-01-20 10:57:32

So in other words, the obesity rate of those living in weedy Colorado and weedy Washington might be expected to climb.

That assumes that there will be substantially more pothead residents than before. We already have plenty and are the leanest state in the union.

 
Comment by overpaid government contractor
2014-01-20 11:48:24

We have Peyton, we have legal weed, and we have equity

Everybody wants to live here

 
Comment by Dale
2014-01-20 13:27:07

“all metro denver papa john’s online orders are 50 percent off today thanks to peyton”

Isn’t that a bit risky offering food discounts in a town with legal weed?

 
Comment by oxide
2014-01-20 13:58:20

Cheesticks aren’t paleo, oh squad. And no, the bacon doesn’t make up for it.

 
Comment by Janet Felon
2014-01-21 00:29:55

“Paleo” is great- if you like skyrocketing cholesterol and blood pressure.

 
 
Comment by Hi-Z
2014-01-20 07:58:59

When did you buy equity in a sports team?

(Comments wont nest below this level)
Comment by oxide
2014-01-20 08:58:58

He’s kidding, ya know. The inside joke is that Peyton and the football team are are going make real estate more valuable. Of course, our HBB poster won’t get any of that equity at all, because he lives in an apartment. Equity will go to the landlord, who will use the rising equity as an excuse to raise the rent. Funny how that works.

That said, I’ll root for Denver. Not just because of Peyton. The Seattle-San Fran game was laden with questionable penalties which tended to favor Seattle. Not enough to question refs on the calls; more like the game was just sloppy and dirty in general. It seems unfair for Seattle to win a Superbowl that way.

 
Comment by overpaid government contractor
2014-01-20 09:28:47

all metro denver homeowners and renters get 10k of free equity every time the broncos win

 
Comment by suite Joey blue eyes (csn&y superfan)
2014-01-20 09:42:12

You can fairly easily buy equity in certain sports teams. I have shares of the packers and celtics. I know some others sell shares as well. My dad gave us celts shares bc he liked larry bird. I bought the packers shares in college. I’m not a fan of either team.

 
Comment by overpaid government contractor
2014-01-20 09:55:41

i’m riding the chairlift at winter park right now, enjoying the fruits of my equity

you will *respect* the equity

and for your loosing teams, there’s always next year

 
Comment by Anklepants
2014-01-20 09:58:10

Pete Carroll is an honest man.

 
Comment by Housing Analyst
2014-01-20 10:41:16

“Equity” is a fallacy. It doesn’t exist.

 
Comment by overpaid government contractor
2014-01-20 10:56:07

“Equity” is a fallacy

No, your $50/square foot shacks are a fallacy.

Metro Denver median house price per square foot will be $200+ after the Souper Bowl.

 
Comment by Housing Analyst
2014-01-20 10:59:24

Without a buyer in sight.

 
Comment by In Colorado
2014-01-20 11:00:28

Metro Denver median house price per square foot will be $200+ after the Souper Bowl.

In key nabes it already is $200+. Insane, but there it is. Of course you can get cheaper digs in Aurora and places Brighton.

 
Comment by overpaid government contractor
2014-01-20 12:28:26

If Denver is Manhattan then Aurora is its Brooklyn and Brighton is its Queens

When Peyton throws equity he throws it to the whole metro area

 
Comment by In Colorado
2014-01-20 14:56:21

If Denver is Manhattan then Aurora is its Brooklyn and Brighton is its Queens

LOL! Though I think Brighton is more like Newark ;-)

 
Comment by AbsoluteBeginner
2014-01-20 21:06:06

Show me the……munchie.

 
 
 
 
 
Comment by jose canusi
 
Comment by phony scandals
2014-01-20 06:59:03

Zero-Down and Stated Income Home Loans are Back in Las Vegas

Published on Wed, Jan 15, 2014 (2:43 p.m.)
Submitted by Anyah Ellis

No longer do potential home buyers have to worry about the typical 20 percent down payment in order to purchase the home of their dreams. Zero-Down loans are now once again being offered by lenders which makes buying a home a reality for so many that would otherwise not be able to pursue the dream due to down payment percentage restrictions.

Stated Income loans are also now easily accessible through a variety of lenders which allows self-employed individuals and freelancers to be able to qualify for a mortgage that they wouldn’t have otherwise been able to obtain, when they do not have the typical types of ways to provide proof of their income.

Jared Jones believes that this has the potential to greatly effect the Las Vegas real estate market as many potential homeowners have written off the idea of purchasing their dream home because they don’t have enough for a down payment or don’t think that they can qualified because they are self-employed and their income is tough to prove.

While new lending rules went into effect earlier this month, perhaps the biggest thing about the rules is what was not stated. There is no credit score requirement, nor a minimum down payment amount. Now no and low-down payment options exist which is a huge deal for the Las Vegas housing market and other markets across the United States.

http://www.inbusinesslasvegas.com/community/press-releases/4480/ - 29k -

Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 11:50:59

oh, BARF!

 
Comment by Tarara Boomdea
2014-01-20 13:13:32

Zero-Down and Stated Income Home Loans are Back in Las Vegas

Agggh. After months and years of anticipating another leg down here in Las Vegas, I hear this and maybe I should just buy the rental I’m in.

Even places around here (Central Vegas, which is not the nicest) are selling for way over what they listed at six months ago - in one sickening case, 100K+. Local RE agents who were warning everyone of a coming correction are now tempering their predictions. Everything’s going to go to sh!t in 2015 now. Almost eight years renting, one year free, I’m on E as far as dealing with haughty PMs (”You will not contact the landlord personally again”) and crazy LL’s.

Last year that Jared Jones had a video up for a short time predicting how the Vegas market would tank, then removed it.

Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 13:21:19

Yet even Zillow tells us this:

Listings & Sales Data through Nov 30, 2013
$102 Median list price / sq ft
$101 Median sale price / sq ft
27.0% Listings with price cut
33.0% Sold below listing

Comment by Housing Analyst
2014-01-20 13:32:18

That excludes defaults, foreclosures and REO.

(Comments wont nest below this level)
 
Comment by Whac-A-Bubble™
2014-01-20 17:33:43

Is under $100 / sq ft considered a good price to buy residential property in Las Vegas?

(Comments wont nest below this level)
 
 
Comment by Mr. Smithers
2014-01-20 14:29:15

Bbbbut Housing Analyst says demand for housing is down 195%.

How can this be?

Looks like you’ll be waiting another 8 years. This is what happens when you make life decisions based on blog posters.

Comment by Tarara Boomdea
2014-01-20 14:34:33

This is what happens when you make life decisions based on blog posters.

Because of this blog I sold my house in New York in 2006.

(Comments wont nest below this level)
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 15:22:20

Cha-CHING!

 
Comment by Housing Analyst
2014-01-20 16:08:22

“Because of this blog I sold my house in New York in 2006.”

And that day is here once again.

 
 
 
 
Comment by Mr. Smithers
2014-01-20 14:26:39

“Zero-Down and Stated Income Home Loans are Back in Las Vegas”

Good. 20% down is a relic of the past.

Comment by sleepless_near_seattle
2014-01-20 14:55:29

For those that like renting from the bank, perhaps that’s good news. For the rest of us, not so much…

Comment by Mr. Smithers
2014-01-20 15:39:40

Ahh yes but the rent to the bank is tax deductible. The rent to the landlord isn’t. And after 15-30 years of rent I have something to show for it. You….not so much.

(Comments wont nest below this level)
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 16:01:00

It depends on how much you PAID for the house, versus how much you would pay to rent it. It’s called “math”.

 
Comment by Housing Analyst
2014-01-20 16:37:05

Rent to the bank is only tax deductible if you pay enough interest and property taxes to exceed the standard deduction.

90% of LoanOwners don’t take the mortgage interest deduction.

Alrighty Slithers?

 
Comment by sleepless_near_seattle
2014-01-20 19:29:39

Rent to the bank is only tax deductible if you pay enough interest…

Yup.

 
Comment by sleepless_near_seattle
2014-01-20 19:35:35

It depends on how much you PAID for the house

aaaand, yup. The long math doesn’t work for the vast majority of buyers, those who’ve been coerced into thinking they need to “move up,” so they move every 2-7 years.

 
Comment by Whac-A-Bubble™
2014-01-20 20:17:59

“…who’ve been coerced into thinking they need to “move up,” so they move every 2-7 years.”

It worked great for my SIL and ex-hubby, up until the fourth house they bought at a price north of $500K in an area of UT where home prices have never been as high before or since when they bought. Shortly after the fourth home purchase, they split, and their family lives have been a worse nightmare in divorce than when they were married.

I view the serial move-up home purchases as more of a symptom of marital discord than a cause thereof.

 
 
 
 
Comment by Mugsy
2014-01-21 02:27:33

NINJA’s rule!!!!!!!

 
 
Comment by Whac-A-Bubble™
2014-01-20 06:59:34

It appears that California housing has achieved a permanently high plateau.

Comment by jose canusi
2014-01-20 07:02:40

The fires help keep the inventory pruned.

 
Comment by Whac-A-Bubble™
2014-01-20 07:13:10

Southern California home prices soar but sales tumble in December
By Andrew Khouri
January 14, 2014, 10:52 a.m.
A rebounding housing market has led to an increase in tear-downs as wealthy buyers seek to build larger, opulent homes. (Rick Loomis / Los Angeles Times)
Related
- JPMorgan mortgage settlement is biggest in U.S. history
- How much does Satan worship lower a Las Vegas mansion’s value?
- Adjustable-rate mortgages regain popularity as prices, rates rise

Southern California home prices posted a sizable pop in December, bucking a months-long cooling trend.

The median sales price across the six-county region reached $395,000 last month, a 2.6% gain from November and 22.3% over the year, DataQuick said Tuesday. It was the first significant month-over-month increase since June, a rise the research firm attributed to fewer distressed sales and demand that has outstripped supply.

Sales tumbled 9.2% over the year and rose less than normal from November, evidence of the constrained inventory available for home seekers. Buyers scooped up 18,415 new and resale houses and condos last month, the lowest level in six years.

Sales have fallen short of the same period a year earlier for three consecutive months now, and the pitifully low inventory is the main culprit,” DataQuick President John Walsh said in a statement. “The jump in home values over the last year suggests we’ll eventually see a lot more people interested in selling their homes, which would help ease the inventory crunch.”

Comment by Anklepants
2014-01-20 07:35:47

Amy believes the trend will continue until that final month where a single house sells for infinity dollars.

Comment by Whac-A-Bubble™
2014-01-20 07:38:46

Strictly speaking, shouldn’t the final month feature 0 houses selling for infinity dollars?

(Comments wont nest below this level)
Comment by azdude02
2014-01-20 08:27:29

it will continue because the banks know that in the next bust the FED will print a bunch more money to make them solvent again.

why change when you know you can make a fortune issuing bogus loans and then get bailed out when the market has a correction.

They set a bad precedent in the last bubble. History repeats itself.
this is not capitalism. Capitalism allows people who take stupid risk to go out of business. Its the checks and balances part.

 
Comment by Anklepants
2014-01-20 10:00:18

“Strictly speaking, shouldn’t the final month feature 0 houses selling for infinity dollars?”

but that doesn’t make any sense. ;\

 
Comment by ocwen
2014-01-20 18:36:39

Calculus lets you divide by zero

 
Comment by Whac-A-Bubble™
2014-01-20 20:19:53

“Calculus lets you divide by zero”

Especially if the numerator goes to zero. It also lets you multiply zero times infinity, at least in the sense of multiplying functions approaching those extremes. Thanks are due to L’Hopital for figuring out the rule.

 
Comment by Mugsy
2014-01-21 02:28:37

I knew there was a calculus problem in there somewhere :)

 
Comment by Carl Morris
2014-01-21 04:19:21

Thanks are due to L’Hopital for figuring out the rule.

Yeah…some zeros are more zero than others :-).

 
 
 
Comment by Housing Analyst
2014-01-20 09:32:21

And there it is…..

“I can ask $50k for my 12 year old Chevy truck but where are the buyers at that price?”

And it’s for that reason we see asking prices of resale housing getting slashed all over the country.

 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 11:57:40

Why does DataQuick keep referencing a “tight inventory” in every single one of its articles? They don’t actually publish the inventory numbers. They publish sales and prices. If they HAVE the inventory numbers, and they are going to REFERENCE the inventory numbers, then let’s see the numbers. Movoto seems to think that inventory is up (not down) almost everywhere.

Comment by Housing Analyst
2014-01-20 12:25:49

Because inventory is up?

(Comments wont nest below this level)
 
Comment by Whac-A-Bubble™
2014-01-20 17:36:12

My impression is that DataQuick assumes the reason sales are so low is because of low inventories…never mind those astronomical prices!

Perhaps the correct statement is that inventories of reasonably priced California homes are nonexistent.

(Comments wont nest below this level)
 
 
 
Comment by Whac-A-Bubble™
2014-01-20 07:20:19

Markets More: U.S. Housing California
As Goes California, So Goes America — And California Isn’t Looking Good
Mamta Badkar
Jan. 19, 2014, 8:49 AM

The housing recovery we’ve seen in the past couple of years has largely been driven by the West Coast.

Home prices in California plunged 42% from their March 2008 peak during the downturn, and then rebounded 36%.

Prices surged not only because of the extreme drop in prices during the downturn, but also because of “the efficient disposition of distressed homes, low non-distressed inventory, economic recovery, and foreign/second home demand,” writes Michelle Meyer, an economist at BofA Merrill Lynch, in a note to clients.

But housing affordability has started to fall. Only one-third of California’s households can afford to buy a house, and only 21% in San Francisco can afford to make a purchase now.

“Prices in the San Francisco metro area have already exceeded the pre-crisis peak and set a new record high,” says Meyer.

“This reflects low inventory and a minimal amount of distressed activity — only 4.5% of sales are distressed, and it takes less than 2 months to clear the distressed supply.”

California’s home price growth is expected to slow in 2014, and California is a leading indicator for the overall housing market.

“This is consistent with our view that national home price appreciation will slow to about 5% this year, from the current run rate of nearly 14% year over year in 2013,” says Meyer.

Comment by Anklepants
2014-01-20 07:39:15

LOL. Why 5 %. Just wild ass guesses to make people calm. That’s below stall speed anyway.

Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 12:12:59

If prices don’t keep going up at 15%+ per year, then another crash will ensue. At today’s prices, the landlords are losing at least that much on their mortgage payments, so they HAVE to make up for it on the appreciation. Otherwise, they will not keep the house. The bank can have it back.

(Comments wont nest below this level)
 
Comment by Mugsy
2014-01-21 02:30:01

5% is a Scientific wild ass guess. 10% is just a wild ass guess.

(Comments wont nest below this level)
 
 
Comment by cactus
2014-01-20 18:38:55

But housing affordability has started to fall. Only one-third of California’s households can afford to buy a house, and only 21% in San Francisco can afford to make a purchase now.’

When it gets below 10% sell

Comment by Housing Analyst
2014-01-20 20:33:01

“Affordability” is purely a NAR creation. In other words, untrustworthy. Housing hasn’t been affordable since 1998.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2014-01-21 00:00:18

Their calculation starts off with the typically false and always misleading assumption of a 20% downpayment, which makes the monthly seem more affordable. Never mind that a 20% downpayment on a California McMansion would have to exceed $100K in many cases, an amount that few folks have available. And then there is the foregone investment earnings on the $100K (or whatever) downpayment, which the affordability calculation conveniently ignores.

 
Comment by Mugsy
2014-01-21 02:31:29

20% down payment? What country are you talking about?

 
 
 
 
Comment by Whac-A-Bubble™
2014-01-20 07:27:31

Fed taper could hit housing market
Soaring mortgage costs already discouraging local buyers
By Dan McSwain
5 p.m. Jan. 18, 2014

Prospective homebuyer Michael Lin tours one of the model homes in the Maricel at Torrey Highlands development. Prospective homebuyer Michael Lin tours one of the model homes in the Maricel at Torrey Highlands development. — Howard Lipin / U-T San Diego

The stakes are high for San Diego’s housing market as the Federal Reserve tapers the national economy off super-low interest rates.

Some experts think interest rates have been held back more by sluggish global growth than by Fed stimulus, so the “taper” that began this month won’t matter much. Then again, nobody can reliably forecast short-term rate movements.

And there’s little question that higher rates would hurt potential homebuyers. Already, skyrocketing mortgage payments may have chased away enough demand to halt price growth.

Further increases would pile a new problem onto the region’s housing market, which is distorted by a chronic supply shortage and soaring costs caused by local and federal government polices.

Waiting has certainly punished potential buyers lately. A typical new mortgage in San Diego County hit a modern low of $1,150 a month in February 2012, but by last month it had jumped nearly 47 percent to $1,695.

Most of the increase came from home prices, which surged 38 percent in less than two years.

Last summer the action shifted to interest rates, which have climbed from 3.5 percent to nearly 4.5 percent for the average fixed-rate, 30-year mortgage. That run-up started in May, when Fed Chairman Ben Bernanke outlined his plan to gradually reduce bond purchases the central bank began in September 2012 to keep rates low.

Maybe it’s a coincidence, but San Diego’s soaring housing market leveled off at almost precisely the same time.

Gordon Wagner · Top Commenter · Works at Being Less Abrasive
The “Fed” is simultaneous printing and purchasing how many billion dollars of US bonds each month? Tell me how that is different than climbing down a cliff, running out of rope, but using the same length of rope, tying the top to the bottom to make it longer? And have you ever seen a chart of US inflation since the inception 100 years ago of the “Fed”?

Do you know that we were once able to mint a penny out of pure copper? But now a penny is coated base metal, like our other coinage. That is a canary in the coal mine. And it is lying on the floor of its cage and not moving. Beautiful plumage.
· January 18 at 9:08pm

Comment by azdude02
2014-01-20 09:39:41

“As a natural consequence a
great debtor class grew rapidly, and this class gave its influence
to depreciate more and more the currency in which
its debts were to be paid.†”

 
 
Comment by Whac-A-Bubble™
2014-01-20 07:30:52

Sacramento County’s median home price remains steady
By Hudson Sangree
Published: Wednesday, Jan. 15, 2014 - 7:36 pm
Last Modified: Thursday, Jan. 16, 2014 - 8:16 am

Sacramento County’s median home price held steady in December at about $240,000, where it’s been stuck since midsummer after a big run-up in prices last spring, according to DataQuick.

But the number of homes sold in the county last month was the lowest for any December in six years, the San Diego-based real estate information said Wednesday.

There were 1,696 houses and condominiums sold countywide in December, including new and resale homes. That was the lowest figure since the days of the housing collapse when only 1,372 houses sold in December 2007.

Last month’s sales were about 20 percent below Sacramento’s historical average for December, DataQuick reported.

Comment by reedalberger
2014-01-21 01:10:56

That house is pretty sweet.

 
 
Comment by Whac-A-Bubble™
2014-01-20 07:32:12

Caveat emptor!

Comment by Whac-A-Bubble™
2014-01-20 07:36:40

For $12 million, you can have the former Granite Bay home of actor Eddie Murphy
By Hudson Sangree
Published: Thursday, Jan. 16, 2014 - 12:00 am
Last Modified: Thursday, Jan. 16, 2014 - 8:16 am

It could be the ultimate house flip. A Granite Bay mansion that set a Sacramento-area record when it sold for $6.1 million in 2007 is on the market again, this time for $12 million.

The former home of movie star Eddie Murphy in the gated Los Lagos neighborhood has hardly been touched or lived in for the past six years. It’s owned by Patrick Willis, an investor from Nevada and founder of repossession company American Recovery Service, based in Sacramento.

Willis kept the home’s purple marble floors shined and stocked at least one of its 14 bathrooms with tubes of Colgate Shrek toothpaste.

But otherwise the 12,600-square-foot house is just as Murphy’s wife, Nicole, left it when they divorced, and she sold it. That means it still has a semi-circular purple sofa in the living room, a cassette deck in the family room, a Shrek-themed bedroom and a vintage Ms. Pac-Man machine in the video arcade.

There’s a professional-quality gym, an infinity pool with a two waterfalls, a movie theater with purple seats, and a 5,200-square-foot guest house.

“As soon as you walk in it has that wow factor,” said Nick Sadek, one of two listing agents for the property and a specialist in multimillion-dollar homes. The Granite Bay house was built for the Murphys and their five children because Nicole Mitchell Murphy was from Sacramento.

Sadek sold the same house last time around, hitting a price that has yet to be equaled in Sacramento or its suburbs. Only homes near Lake Tahoe have sold for more in the greater Sacramento region.

This time Sadek is hoping to outdo himself.

Several reasons justify the price, he contended.

9125 Vista De Lago Ct, Granite Bay, CA 95746
For Sale: $12,000,000
Zestimate®: $4,231,917
Est. Mortgage:
$47,086/mo
Bedrooms:10 beds
Bathrooms:14 baths
Single Family:17,851 sq ft
Lot:2.5 acres
Year Built:1996
Last Sold:Dec 2007 for $6,100,000
Heating Type:Radiant

Comment by Whac-A-Bubble™
2014-01-20 07:51:05

Are there really buyers out there who are sufficiently rich and stoopid to pay $12 million for a place that Zillow sez is only worth $4.2 million? (And note that Zillow’s estimates tend to shade to the optimistic side of reality.)

(Comments wont nest below this level)
Comment by azdude02
2014-01-20 08:37:20

wall street money is your only hope on that deal.

Didn’t someone buy it for 6 million n 2007?

Thats a wish price. always aim high cause you know people will low ball you. You want the buyer to think they are getting a deal.

 
Comment by Rental Watch
2014-01-20 12:14:42

I once saw Zillow put a $1MM value on a 12,000 square foot, 2009 built home on 2 (or 3?) acres in Atherton, CA. Complete with pool house, etc. Needless to say, they were WAAAAAYYYY low on value.

Zillow does a terrible job of pricing ultra-high end housing.

That said…you only need to find one person willing to pay that price–the big question is whether there are alternatives in the market with similar features (including similarly featured land with a house they could tear down and build new).

 
Comment by Housing Analyst
2014-01-20 12:30:23

Why would that be low?

 
Comment by Rental Watch
2014-01-20 13:04:00

Because land in Atherton sells for well over $1MM per acre, and the construction materials for a 12,000 square foot house in Atherton are not nearly the same as for a traditional production house.

And don’t claim that you can get land there for $5,000 per acre unless you can find me a piece for sale.

In fact, if you can find me an acre parcel in Atherton for $250,000, I’ll pay you a $250,000 finder’s fee. Good luck.

 
Comment by Housing Analyst
2014-01-20 13:12:58

“12,000 square foot house in Atherton are not nearly the same as for a traditional production house.”

Eh… yeah it is.

 
Comment by Mr. Smithers
2014-01-20 14:35:12

Zillow is fine for cookie cutter homes in subdivisions. If one sells for $200K, the one next door is going to sell for +/- 5% of $200K.

But Zillow is absolutely useless for homes that are either custom built, ie one of a kind or in the $1M+ area where sales are infrequent. And in most cases the $1M+ homes are also custom built.

And it also takes no account of intangible things like views. Take a 1000 sq ft house with an ocean view, that house is worth 50% more than the same house across the street without the view. But according to Zillow, they’re worth the same. Same goes with a house next to train tracks, or on a busy road, or right underneath a flight path. Or on the positive side, the house that’s right next to a park or walking distance to an elementary school. These things can increase or decrease the price of a house by huge amounts.

 
Comment by Rental Watch
2014-01-20 14:48:42

““12,000 square foot house in Atherton are not nearly the same as for a traditional production house.”

Eh… yeah it is.”

Clearly you haven’t stepped foot in any of these houses.

Build this for $50 per foot:

http://www.zillow.com/homedetails/141-Tuscaloosa-Ave-Atherton-CA-94027/15593457_zpid/

Or this:

http://www.zillow.com/homedetails/250-Atherton-Ave-Atherton-CA-94027/15593374_zpid/

Or this:

http://www.zillow.com/homedetails/89-Almendral-Ave-Atherton-CA-94027/15593459_zpid/

Don’t get me wrong, I think the asking prices are OUTRAGEOUS, even with the quality of construction, but these are NOT the same as a $50 per foot construction job.

 
Comment by Housing Analyst
2014-01-20 16:04:17

Those are merely options that amount to another $40-60 a square, if that. Same labor, same lot, same vendors.

 
Comment by Housing Analyst
2014-01-20 16:06:18

And as for you Slithers… “custom” is marketing lexicon to shake down fools like you.

 
Comment by Rental Watch
2014-01-20 17:46:34

“Those are merely options that amount to another $40-60 a square, if that. ”

How quickly a few pictures doubled your cost. Too bad the doubling is woefully inadequate for some of the work done on and in these houses and grounds surrounding the houses.

Same labor? lol. My partner built his house in Atherton that included a rotunda in the entry, complete with 360 degree curved crown molding. The installer for the crown molding was not just a typical guy who has installed crown molding before–he was an expert with getting the wood to curve just right–and last once installed.

You think an average framing contractor did the wood paneling in those studies? The local tile guy set the stonework in the yard? The people having these houses built have exacting tastes…and will pay A LOT for high quality finishes and materials.

Many of them have extensive landscaping, water features (in addition to swimming pool(s), expensive technology add-ons (high end media rooms, etc.), full and finished basements (in some cases designed to park cars under the house), etc.

$100 per foot to build these houses in Atherton is simply laughable.

 
Comment by Housing Analyst
2014-01-20 17:57:00

Did he have masters in carpentry? A PhD?

SAME labor.

Once again you’ve demonstrated your complete lack of training and expertise in engineering, architecture and contract administration.

Now would like us to review some of your old posts where you backed yourself into a corner?

 
Comment by Rental Watch
2014-01-20 18:15:24

OK then, if you can build these homes for $100 per foot, you should be able to CRUSH the competition that is currently building custom homes in Atherton. I look forward to seeing your signs up around town.

Can you imagine the profit margins if you can build these houses for a mere $100 per foot?

Wow, you’re going to be rich.

 
Comment by Housing Analyst
2014-01-20 18:20:04

….. that’s what I thought.

 
 
 
Comment by azdude02
2014-01-20 07:38:36

“Back in the days of Ancient Greece and Rome, it was always considered fraudulent for bankers to lend out money put in their possession for safekeeping though that didn’t stop some who couldn’t resist earning a nice profit.”

Comment by tj
2014-01-20 08:07:15

the reason it was fraudulent is because customers were already paying a storage fee.

(Comments wont nest below this level)
 
Comment by In Colorado
2014-01-20 11:03:10

And until the Reformation, Christians were not allowed to charge interest on loans.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2014-01-20 11:32:12

Followers of Islam still are not allowed to charge interest, unless it is hidden in the terms of a lease contract.

Islamic banking

Islamic banking (Arabic: المصرفية الإسلامية‎) is banking or banking activity that is consistent with the principles of sharia and its practical application through the development of Islamic economics. As such, a more correct term for ‘Islamic banking’ is ‘Sharia compliant finance’.[1] Sharia prohibits the fixed or floating payment or acceptance of specific interest or fees (known as riba, or usury) for loans of money. Investing in businesses that provide goods or services considered contrary to Islamic principles is also haraam (”sinful and prohibited”). Although these principles have been applied in varying degrees by historical Islamic economies due to lack of Islamic practice, only in the late 20th century were a number of Islamic banks formed to apply these principles to private or semi-private commercial institutions within the Muslim community.[2][3]

 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 12:16:07

Christians are still not allowed to lend at interest.

 
Comment by In Colorado
2014-01-20 14:53:47

Christians are still not allowed to lend at interest.

My understanding is that the reformers did away with that restriction. AFAIK, there aren’t any churches out there that will disfellow you for charging interest on a loan. if you google New Testament and Usury you will find tons of links to Fundy apologists who defend charging interest on loans.

 
 
 
 
 
Comment by phony scandals
2014-01-20 07:04:27

Banks embracing a housing-bubble favorite: interest-only loans

latimes.com
Jan 18, 2014

Customers for interest-only loans are often self-employed and capable of making big down payments and maintaining fat bank accounts. Most of the risky mortgages that triggered the financial crisis have disappeared from the marketplace, and lenders will have even more reason to avoid them because of a new federal crackdown on loose lending. full story

http://business.topnewstoday.org/business/article/9530523/ - 88k -

Comment by azdude02
2014-01-20 09:41:27

“In this mania for yielding
to present enjoyment rather than providing for future comfort
were the seeds of new growths of wretchedness: luxury,
senseless and extravagant, set in: this, too, spread as a
fashion. To feed it, there came cheatery in the nation at
large and corruption among officials and persons holding
trusts.”

 
Comment by rms
2014-01-20 10:37:08

“interest-only loans”

Heavenly manna.

 
 
Comment by Housing Analyst
2014-01-20 07:14:06

Considering we’re profitable building new structures anywhere in the country at $55/sq foot(lot, labor, materials and profit), why pay more than $35-$40/sq ft for a 20+ year old house?

Comment by azdude02
2014-01-20 08:34:14

your shanties would never pass code here.

Comment by Housing Analyst
2014-01-20 08:36:57

All 48 states

Comment by Army No Va
2014-01-20 11:10:30

Where is your web site? Zillow links to what u have built?

(Comments wont nest below this level)
Comment by Housing Analyst
2014-01-20 11:20:34

Hello realtor.

And what could you possibly derive considering your stock in trade?

Check Bechtel, Layne and Cianbro and then get back to us….. We’re looking forward to it.

In the meantime, check out sliding housing prices across the DC metro area.

Falls Church, VA Housing Prices Down 10% Year over Year

http://www.movoto.com/falls-church-va/market-trends/

 
Comment by polly
2014-01-20 13:22:54

From your link, median list price shows down 5% not 10%.

Also up 20% on the price per square foot.

 
Comment by Housing Analyst
2014-01-20 13:30:35

5 10 or 15….. Trend is down.

 
Comment by polly
2014-01-20 14:13:29

Also up 20% on the price per square foot. The houses that are being listed at just a small discount from last years listings are 30% smaller than the ones that were listed last year.

 
Comment by Housing Analyst
2014-01-20 16:01:21

So Donkeys are still getting ripped off as badly as last year.

 
Comment by polly
2014-01-20 16:57:10

No, worse. Prices are going up in Falls Church year over year (at least if you care about asking prices which you have been arguing far over the past few days).

 
Comment by Housing Analyst
2014-01-20 17:09:00

No. Median asking price is down 6%.

 
 
Comment by Rental Watch
2014-01-20 12:17:06

Wait, there are only 48 states?

(Comments wont nest below this level)
Comment by Housing Analyst
2014-01-20 12:24:33

That’s it? Serious?

 
 
 
 
 
Comment by Whac-A-Bubble™
2014-01-20 07:14:10

Big Brother is watching you.

Comment by Whac-A-Bubble™
2014-01-20 07:15:45

Jan. 20, 2014, 8:40 a.m. EST
Your home will soon be a giant iPhone
Google (and others) know when you’re asleep — and when you’re awake
By Quentin Fottrell

Google’s (GOOG -0.49%) purchase of home automation company Nest Labs gives the world’s biggest search engine a foothold in people’s homes. But experts say Internet companies are already tracking the habits of Americans at home — and it’s only just begun.

Comment by In Colorado
2014-01-20 07:46:58

Only if you buy and setup their gadgets. Of course the sheeple will rush in like idiots to buy this junk and will then brag to each other at parties about how “wired” their homes are.

Comment by azdude02
2014-01-20 08:43:31

yeah thats true dude. Everyone wants to feel smart with the latest gizmo and gadget.

I assume this nest gadget lets you adjust your thermostat wirelessly? BFD They are pricey too, > 250

They sell programmable thermostats for 30 bucks but people are to lazy to program them. its like the vcr.

(Comments wont nest below this level)
Comment by Mr. Smithers
2014-01-20 08:55:39

Overheard in 1903…

AzDude02’s Great Grandfather: Cars? Who needs ‘em. Nothing but the latest gizmo. I’m sticking with my horse and buggy thank you very much.

 
Comment by Anklepants
2014-01-20 10:09:51

If Google wants to drive me to work, more power to them. Or Apple or any other company that actually gets things done.

 
Comment by In Colorado
2014-01-20 11:09:09

If Google wants to drive me to work, more power to them.

We all know how bug free software is. Plus Google will know everyplace you go. Very convenient for the government.

Or Apple or any other company that actually gets things done.

FWIW, its the guys behind “Enterprise Systems” that get things done. Apple just makes toys.

 
Comment by Steve W
2014-01-20 11:56:17

We’re getting closer to needing the Butlerian Jihad.

thinking of you, Olygal

 
Comment by Anklepants
2014-01-20 13:14:07

“We all know how bug free software is. Plus Google will know everyplace you go. Very convenient for the government.”

Everyone who owns a cell phone has long ago acquiesced to self bugging, gps, etc. Fortunately because you are a nobody, nobody cares. (Not you personally).

 
Comment by tresho
2014-01-20 15:05:33

this nest gadget lets you adjust your thermostat wirelessly? BFD They are pricey too, > 250
$99 at my local Sam’s Club for a Honeywell WiFi enabled thermostat. A ND friend of mine uses his to turn up his house’s heat an hour before he returns home from a long road trip, which seems a useful thing to do.

 
 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 12:21:28

I used to live in Sillycon Valley. It’s like a competition to see who can be the biggest lapdog to Google, or whatever other company has an overpriced, under-needed device to sell. There is part of me that wants to keep the battery out of my cell phone when I’m not using it, but another part that is too lazy to pop the cover off.

(Comments wont nest below this level)
 
 
 
Comment by azdude02
2014-01-20 07:31:53

“The cheap money causes investment to funnel into high order capital goods while fewer resources are used in the production of consumer goods. But because consumers themselves haven’t changed their spending patterns so that the pool of real resources isn’t drained as quickly, precious capital ends up being consumed as the eyes of business are blinded by the illusion of low-cost money. As this truth comes to light, long term investment projects must be abandoned and liquidated. The large number of “for sale” signs which still dot the yards of the areas most affected by the housing bubble in the U.S. are demonstrative of the harmful effects an inflation-induced boom. And just as money printing by the central bank pushes down interest rates in order to facilitate a boom, unbacked credit expansion has the same effect.”

Comment by tj
2014-01-20 07:56:32

precious capital ends up being consumed

dollars, which is what he means by ‘precious capital’ are never ‘consumed’. they are misallocated. it’s an important distinction to make. rather than being destroyed, they are sent to the wrong place. products are consumed, not dollars.

 
 
 
Comment by phony scandals
2014-01-20 07:24:56

Germany Has Recovered A Paltry 5 Tons Of Gold From The NY Fed After One Year

Submitted by Tyler Durden on 01/19/2014

http://stateofglobe.com/2014/01/19/germany-has-recovered-a-paltry-5-tons-of-gold-from-the-ny-fed-after-one-year/ -

Comment by jose canusi
2014-01-20 07:40:55

ha-ha, the gold has been sold to Chindia.

Comment by azdude02
2014-01-20 07:55:18

“The unsuspecting public had no idea that goldsmiths were issuing paper receipts accepted as money which were backed by no gold deposits at all for ten times or more the amount of gold that had been entrusted to them. The goldsmiths were secretly creating money out of thin air. They thus made themselves fantastically wealthy without anyone noticing what was going on. To better hide this deceit and divert people’s attention, the goldsmiths stopped their old practice of charging for storing gold and instead began to pay customers a small interest on their gold deposits to keep them happy. Thus it was that modern day bankers were born.”

 
 
Comment by azdude02
2014-01-20 08:32:56

the gold was used to pay for the food stamp program.

Comment by Army No Va
2014-01-20 11:15:36

The gold was used to fund the govt shutdown!!

 
 
Comment by phony scandals
2014-01-20 15:06:51

Bundesbank to Recall 30-50 Tons of Gold From New York in 2014

By Alessandro Speciale and Maria Kolesnikova
Jan 20, 2014 8:34 AM

Save The Bundesbank plans to repatriate 30 to 50 metric tons of gold stored in New York this year under a plan to ship home half of its bullion reserves held abroad.

The central bank transferred 32 tons of gold from Paris and five tons from New York last year, according to a Bundesbank spokesman. The bank expects to repatriate the reserves at a pace of about 50 tons a year, he said.

The Bundesbank said a year ago it will repatriate 674 tons of gold from vaults in Paris and New York by 2020 to restore public confidence in the security of Germany’s reserves. The stockpile is worth $27.2 billion in current prices, from $36 billion a year ago, after gold had its worst year since 1981.

“Comments made by the Bundesbank make it clear that it has a very great deal of confidence in the security of its gold holdings abroad,” said David Jollie, an analyst at Mitsui & Co. Precious Metals Inc. in London. Given this level of confidence, “there is little reason for it to rush through this process, particularly as physically shipping metal will incur some costs for the Bundesbank.”

The central bank will bring home all 374 tons of its gold held at the Banque de France and a further 300 tons from the New York Federal Reserve, with holdings at the Bank of England unchanged, it said last year. It needs to repatriate about 91 tons a year to meet its target by 2020, Bloomberg calculations show.

German gold reserves, the second-largest in the world after the U.S., amounted to 3,387.1 tons as of Nov. 30, according to World Gold Council data. Germany’s Audit Court sparked a debate about the country’s gold reserves in 2012 when it called on the Bundesbank to take stock of its holdings abroad, saying their existence had never been verified.

To contact the reporters on this story: Alessandro Speciale in Frankfurt at aspeciale@bloomberg.net; Maria Kolesnikova in London at mkolesnikova@bloomberg.net

 
 
Comment by Housing Analyst
2014-01-20 07:39:08

realtoRs Are Liars

Comment by phony scandals
2014-01-20 08:55:20

Chickens are Fryers

 
 
Comment by Whac-A-Bubble™
2014-01-20 07:49:29

Jan. 20, 2014, 4:22 a.m. EST
Oil futures fall after weak Chinese output data
By Laura He, MarketWatch

HONG KONG (MarketWatch) — Oil futures dropped Monday, after China posted a slowdown in industrial output growth.

February crude oil fell 63 cents, or 0.7%, to $93.74 a barrel in electronic trading. Prices on Friday rose 41 cents, or 0.4%, to close at $94.37 a barrel on the New York Mercantile Exchange.

Weak industrial production print from China released this morning is weighing on the crude oil prices, “ said ICICI bank’s analysts in a note on Monday.

 
Comment by Housing Analyst
2014-01-20 07:52:03

Here’s one for that realtor-like howling coward of a liar “MikeInBend”;

Bend, OR Housing Prices Plummet 15% YoY; Inventory Up 19%

http://www.movoto.com/bend-or/market-trends/

Comment by azdude02
2014-01-20 07:56:46

havent heard from him in awhile. he was making money hand over fist as I remember. did you run him off with your dribble?

Comment by Housing Analyst
2014-01-20 07:58:15

Are you sure you’re not drooling $hitHousePoet?

Comment by azdude02
2014-01-20 08:21:13

I see more of the same BS statistics today.

(Comments wont nest below this level)
Comment by Housing Analyst
2014-01-20 08:34:40

If I were you I wouldn’t like them either.

 
Comment by azdude02
2014-01-20 09:47:40

“At the first cabinet council Bonaparte was asked what he intended to do. He replied, “I will pay cash or pay nothing.”

 
 
 
 
 
Comment by Mr. Smithers
2014-01-20 08:46:37

So who does everyone like in the Pot Bowl?

I’d say Peyton and the gang for sure…except for some inexplicable reason this year the game will be played in New York. So Peyton’s delicate hands will be cold, which means he’ll play like crap.

Seattle by 8.

Comment by phony scandals
2014-01-20 08:57:20

Bong Bowl!

Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 12:27:17

Bowl bowl.

Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 12:29:53

No, better:

Smoka bowl.

(Comments wont nest below this level)
Comment by Housing Analyst
2014-01-20 12:34:01

FillaBowl

 
 
 
Comment by In Colorado
2014-01-20 15:06:14

Bong Bowl!

Hmmm…. Maybe Denver will get to host the Souper Bowl someday, even though the stadium lacks a dome, especially since it doesn’t have a dome ;-)

Sports Authority Field at Mile High (Isn’t that a mouthful?)

gets renamed to:

Mary Jane Field at Way Out High

Duuude, did the Broncos just score?
Don’t know, man, all I know is that Dave’s not here!

 
 
Comment by In Colorado
2014-01-20 14:43:58

I’d say Peyton and the gang for sure…except for some inexplicable reason this year the game will be played in New York. So Peyton’s delicate hands will be cold, which means he’ll play like crap.

Will it be any colder than in Denver?

It would be funny if one of those polar vortex jobs hit the Big Apple during Souper Bow Sunday

 
 
Comment by Brett
2014-01-20 09:03:46

Hi everyone,

I haven’t posted in a while, but I try to read your comments almost every day. Some of you may remember me; I live in Austin, TX.

I indeed received ~500k this month (~250k cash, 230k in 401k), and I am kinda lost.

I have been an engineer for the past 5 years. My best financial decision has been to stay out of debt all together. I cannot longer ask my mom or dad. I don’t really trust anyone regarding money, and whatever decisions I made MUST be well reasoned. I am fairly methodical.

I gotta be honest; I am fairly ‘ignorant’ regarding investing on my own. All the investing I’ve done has been my 401k, which is managed by Fidelity.

I think of the stock market as a very scary place unless you understand it well. For example, my dad lost over 35% of his retirement balance during the previous market crash.

I feel very uncomfortable with almost any financial market right now. There seems to be bubbles in housing, assets, commodities, stock. Interest rates for savers are near 0%, which makes CDs or money markets pretty much useless.

Does anyone have any suggestions for someone in my situation? Resources? Books? Other sites you may visit?

I really appreciate it.

Comment by Housing Analyst
2014-01-20 09:16:44

You’re an engineer? Then you know the first and obvious option;

1) Do nothing.

Sit tight, keep your powder dry.

Comment by tresho
2014-01-20 15:08:50

You’re an engineer? Then you know the first and obvious option;

1) Do nothing.

Sit tight, keep your powder dry.

Agree fully. You are capable of edumacating yissef. What’s the big rush, anyway?

 
 
Comment by my failure to respect is unacceptable
2014-01-20 09:20:07

Don’t quit your job. I made a mistake of quitting of my job after I sold my small business for a decent profit. 1 month of not working was awesome, but the boredom quickly set in.

Comment by Brett
2014-01-20 09:35:37

I’m not going to do that!

I like my job; they treat me well and the benefits are great. Although, I would like to invest my money somehow…

Comment by azdude02
2014-01-20 09:49:30

buy a gold mine and start digging.

(Comments wont nest below this level)
 
 
 
Comment by Mr. Smithers
2014-01-20 09:35:23

70% of it goes to an index mutual fund….find the lowest expense ration fund and invest in that.

20% in corporate bond funds.

10%…play around with it.

BTW your Fidelity funds in the 401k were probably horrible as they most likely had an expense ratio of 3% or higher.

Comment by Ben Jones
2014-01-20 09:39:39

“70% of it goes to an index mutual fund….find the lowest expense ration fund and invest in that.

20% in corporate bond funds.”

10% - Atlanta ski lodge.

Comment by Whac-A-Bubble™
2014-01-20 10:06:58

Zing!

P.S. The stock market is overbought / overvalued right now, so unless your time horizon is very long, an immediate 70% allocation might end up looking like good money thrown after a bad investment.

Bill a bit South of Irvine offered much better advice over the weekend; follow it, and you won’t have to worry over any ‘unexpected’ near-term stock market corrections which ‘nobody could have seen coming.’

(Comments wont nest below this level)
Comment by Bill, just South of Irvine, CA
2014-01-20 19:56:44

It’s a deflation proof strategy. As for inflation, if it’s $500,000 now, in five years someone would have already put $125,000 of it in stock index funds and will be reaping dividends anyway as well as gains from that. I don’t foresee hyperinflation the next 5 years with the way wages are kept down. UNLESS Indian and Chinese engineers and scientists do a massive suicide. That will boost the incomes of the highest paid professionals in the U.S.

Plus, if you keep the cash in T-bills, you are a creditor to the US government and like the Chinese and Japanese. Any confiscation of those treasuries will be just like default - making treasuries of everyone worth less. The Chinese and Japanese won’t like that.

Plus it leaves one with emergency cash, far over a decade of it will be available for over half the years of drawing it down to invest in stock index funds. And one couldn’t care less about taking on new opportunities in career 2,000 miles away. I have done that several times in the last eleven years, working on both coasts. It works even better if you rent and keep the shortest lease.

I would say the 70% strategy would have been a good strategy in 2009. But if Smithers looks at the charts of the stock funds, these are all time highs. It’s dam foolish to put a windfall into stocks now.

 
Comment by Whac-A-Bubble™
2014-01-20 20:21:41

“UNLESS Indian and Chinese engineers and scientists do a massive suicide.”

Much more likely scenario: Indian and Chinese engineers and scientists show up on American soil, depressing wages for American-born engineers and scientists.

 
 
 
Comment by Mr. Smithers
2014-01-20 09:41:48

An index fund should have no more than a 0.05% next expense ratio. Fidelity has a couple of those. For someone who doesn’t know about investing, this is your best choice. You’re basically investing the entire S&P500. Which is why the fees are so low, there is no management of the fund other than administrative.

But stocks are scary!!

Not really. Over the past 10 years there has been 1 down year (2008) and 9 up years. 9/10 success rate in the supposed worst economy since the great depression.

Comment by Mr. Smithers
2014-01-20 09:44:26

S&P500 return by year over the past 5 years..

2013 +32.31 %
2012 +15.99 %
2011 +1.89 %
2010 +15.06 %
2009 +26.37 %

Compare that with 0% interest in checking accounts or 0.5% interest in savings accounts that the HBB is invested in….

(Comments wont nest below this level)
Comment by Housing Analyst
2014-01-20 09:47:24

No oceanfront condos in Arkansas? How about a spanish hacienda on a palm tree lined boulevard in New Hampshire?

 
Comment by azdude02
2014-01-20 09:51:00

how many people lost their life savings in 2008 preacher boy?

 
Comment by Mr. Smithers
2014-01-20 10:00:30

Only people that lost their life savings were those stupid enough to sell at the bottom. Those that didn’t, are up more than 100% since 2008.

You guys made the wrong bet. You invested in an instrumernt that pays 0% interest. The rest of the world invested in an instrument that has paid 100%+.

You can spin it any way you want, you lost. Big time.

 
Comment by Whac-A-Bubble™
2014-01-20 10:16:39

“You can spin it any way you want, you lost. Big time.”

You can cherry pick your data any way you want, too.

S&P 500 Index Yearly Returns
2008 -38.49%

 
Comment by azdude02
2014-01-20 10:31:52

this guy is trying to sell snake oil. I guess he forget the only reason stocks are off their lows is because of central bank manipulation.

also the indexes cherry pick who gets to be in. have a couple bad years and you get booted out.

also earnings are a total hoax. loan loss reserves, one time charges a bunch of BS .

banks pretty much insolvent.

yeah i want to invest in this rigged game. Id rather go to the indian casino.

thats why a lot of people have lost total confidence and will never return.

 
Comment by Whac-A-Bubble™
2014-01-20 10:53:21

Genius is a rising market.

– John Kenneth Galbraith

 
Comment by Neuromance
2014-01-20 10:57:03

I ran an experiment from Winter 2000 to Summer 2011. I put 10,000 dollars into an S&P 500 index fund. Didn’t touch it.

Results:
• Most of that time it was underwater.
• I pulled it out in summer 2011, before the market tanked.
• I liquidated the investment and got back 11,000 dollars.
• That’s about 1% annual interest. Much less yield than a savings account in those days.

Conclusion:
• This was the most conservative, surefire way to invest, as it was advertised back then (and even today)
• You need to have some good luck to pick your get-in and get-out dates, even in a highly diversified S&P 500 index fund.

See also: NASDAQ, from 1997 to present.

 
Comment by Whac-A-Bubble™
2014-01-20 11:00:44

“I ran an experiment from Winter 2000 to Summer 2011. I put 10,000 dollars into an S&P 500 index fund. Didn’t touch it.

Results:
• Most of that time it was underwater.
• I pulled it out in summer 2011, before the market tanked.
• I liquidated the investment and got back 11,000 dollars.
• That’s about 1% annual interest. Much less yield than a savings account in those days.”

You obviously lack Mr. Smither’s genius for timing investments in S&P 500 Index Funds.

 
Comment by Bill, just South of Irvine, CA
2014-01-20 21:01:14

“S&P500 return by year over the past 5 years..

2013 +32.31 %
2012 +15.99 %
2011 +1.89 %
2010 +15.06 %
2009 +26.37 %

Compare that with 0% interest in checking accounts or 0.5% interest in savings accounts that the HBB is invested in….”

You must be new to investing Smithers. Sure, I enjoyed those returns - 100% of my Vanguard IRAs are in the 500 index fund. However, I remember the late 90s too when it was supposed to be a new paradigm - “it’s different this time.” And then the crash. Look at the S&P 500 in 2002 and 2003 compared to 2000. I still contribute weekly to my traditional IRA Vanguard 500 fund. But the point is that I have been doing this weekly contributing for over ten years and my cost basis is very reasonable, and slow to budge.

You are proposing the same mistake I did in 2001: Get a windfall and put most of it in stocks. I did that. Lost 50%. That taught me a big lesson.

Apparantly you never had a windfall like Brett has and you are steering him to potential disaster if he goes 100% into stocks.

 
Comment by Whac-A-Bubble™
2014-01-21 00:03:48

“You are proposing the same mistake I did in 2001: Get a windfall and put most of it in stocks. I did that. Lost 50%. That taught me a big lesson.”

Brett is free to learn vicariously from the warnings some of us have offered, or else throw caution to the wind and follow Smithers’ advice to bet 70% on the proposition that the stock market always goes up.

I hope he keeps us posted on the path he follows and how it works out for him.

 
 
Comment by Whac-A-Bubble™
2014-01-20 10:07:59

Not scary — just overbought/overvalued.

But keep on feeding your strawmen, as they are highly entertaining!

(Comments wont nest below this level)
 
Comment by Brett
2014-01-20 10:09:09

Thanks for your advice!

I am looking at my Fidelity investment options, and the categories are.

-Stock Investments
-Blended Fund Investments
-Bond Investments

All the blended fund investments have a ‘target year’ attached to them, which I believe allows Fidelity to minimize / maximize the risk. All these Fidelity blended fund investments have next expense rations of at least 0.8%!!!

The only 3 stock investment funds that offer a next expense ratio anywhere close your suggestion are:

Spartan® 500 Index Fund - Fidelity Advantage Class, FUSVX - 0.7%

Vanguard Mid-Cap Index Fund Signal Shares, VMISX - 1%

Vanguard Small Cap Index Fund Signal Shares, VSISX - 1%

(Comments wont nest below this level)
Comment by azdude02
2014-01-20 10:34:05

u want to lose your money dont you?

 
Comment by Whac-A-Bubble™
2014-01-20 10:40:32

Those “target allocation funds” which follow the traditional rule-of-thumb to divide assets between stocks and long-term bonds could be losers during the QE taper period, which potentially will resemble no investing conditions seen since the early-1980s.

 
 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 12:32:49

The expense ratio will be about 50% after the next correction, M. slith.

I’m sure Brett can wait until he sees an obvious available investment. If you can’t tell that it’s a good investment, then don’t do it. Eventually, something will come along.

(Comments wont nest below this level)
Comment by Mr. Smithers
2014-01-20 14:03:28

If you bought and index fund 2000 and sold in 2011, while re-investing dividends for 11 years, there is absolutely no way you lost money. You’re lying.

 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 14:19:52

Slith:

I am talking about the correction that will happen in the future. Much like the corrections that have happened in the past. You can cherry-pick any two years that you like. However, a person who buys into the stock market in 2014 is probably going to fare no better than one who bought in 2008 (i.e., not that well). For those who buy and hold, you are depending on manipulation to work forever. How much faith do you have in government?

 
Comment by Mr. Smithers
2014-01-20 14:24:01

Past 33 years stocks have returned 8% a year on average. And this has included several corrections.

What you people don’t seem to get is that a correction is preceded by and followed by an expansion. But you’re perma-doom and gloomers so you only see what you want.

Good luck with the 0% checking account.

 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 15:38:51

Slithers:

You keep cherry-picking years, yet you claim that it is incorrect for a person to discuss whether or not to buy something this year. This year, Slithers.

 
Comment by Mr. Smithers
2014-01-20 15:43:10

33 years is cherry picking?

Fine got back 53 years and stocks. Had you invested $1000 in 1961 in the S&P500, today you’d have $22,000. This is assuming you re-invested all dividends.

Compare that to keeping the money in a checking account.

Hey it’s your money, do as you wish.

 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 16:04:49

Slithers:

When stocks are OBVIOUSLY overvalued (like, um, duh, now), then there is no reason in the world to buy them. Brett already said that HE thinks they’re overpriced. What do you gain from advising him to buy them? If Brett just inherited a half-million dollars, then he needs to avoid doing anything that seems overly risky. Do you hate Brett? Why don’t you just act normal and advise him not to do anything that doesn’t seem right?

 
 
Comment by Whac-A-Bubble™
2014-01-20 17:43:58

Did this part of Brett’s post go right past you?

“I think of the stock market as a very scary place unless you understand it well. For example, my dad lost over 35% of his retirement balance during the previous market crash.”

(Comments wont nest below this level)
 
 
 
Comment by Whac-A-Bubble™
2014-01-20 10:03:06

Did you bother to read all the excellent advice many posters provided you over the weekend?

Comment by Brett
2014-01-20 10:10:09

Yes, I am and have taken several notes. There were a few terms / ideas I wasn’t completely familiar with and my goal is to read about them and ask more questions.

The only reason I am posting today is because I Know many don’t visit the forum over the weekend.

Comment by Whac-A-Bubble™
2014-01-20 10:27:27

Here is a simple choice for you to consider:

Mr. Smithers‘ strategy: Throw caution into the wind, park 70% of your $500K in a stock market index fund and hope for the best. (You are an engineer, so think hard about his success metric before following this course: “9/10 success rate in the supposed worst economy since the great depression.”)

Bill Just South of Irvine strategy: Park funds under a proverbial financial mattress, then systematically build up your stock market allocation through a series of fixed installment payments over the next several years.

The first strategy will work best if the stock market always goes up from here through the end of the taper, the way it did since March 2009 through the course of QE1, QE2 and QE3-until-taper (and, coincidentally I’m sure, over the period of years for which Smithers posted returns).

The second strategy will work out better if the average stock price over your “dollar-cost-averaging allocation period” (e.g. 5 years or whatever) turns out to be lower than currently overbought / overvalued levels.

Take your pick, and may the odds be ever in your favor.

(Comments wont nest below this level)
Comment by Mr. Smithers
2014-01-20 14:11:08

Had you invested $1000 in 1980 in the S&P500, today you’d have about $13,000 if you didn’t reinvest dividends and about $17,000 if you did.

Think of what has happpened since 1980….2 Iraq Wars, 9/11, .com bubble, housing bubble, several recessions, Asian crisis, the crash of 1987….and yet through it all stocks went up by an average of 8% a year over the past 33 years.

Stocks are a good bet long term. That’s not my opinion, that’s fact.

 
Comment by Whac-A-Bubble™
2014-01-20 17:50:30

“Stocks are a good bet long term. That’s not my opinion, that’s fact.”

Parking a 70% allocation of new money in stocks when experts left and right are warning on bubbles, overboughtness, and overvaluations is a bad bet over any time horizon. That’s not my opinion, that’s a fact.

And note that the two options (yours versus Bill’s) both suggest allocating money to the stock market, though with different timing. Or pretend to ignore the details if you choose.

 
Comment by tresho
2014-01-20 18:11:22

Stocks are a good bet long term. That’s not my opinion, that’s fact.
Long term bets are not facts. Past performance is no guarantee of future outcomes.

 
Comment by Whac-A-Bubble™
2014-01-20 18:32:00

U.S. stocks have outperformed other asset classes since WWII. However, past performance is no guarantee of future results.

Ignore Mr. Smithers’ yammering and check out how well the Japanese market performed from 1990-2010 to see for how long stocks can keep dropping over periods of historical weakness.

 
 
 
 
Comment by Puggs
2014-01-20 10:20:47

“Millionaire Next Door” is a good book to keep you focused on the goal of living debt free. As long as you don’t get caught up trying to keep up with those around you it’s pretty easy to be a millionaire in America.
Investing in Vanguard (Growth Income, Growth and International) is good advice.

Comment by Whac-A-Bubble™
2014-01-20 10:32:21

Another very compelling read, easily understandable by someone with an engineering degree, is A Random Walk Down Wall Street by Burton Malkiel. It lays out the case for dollar-cost-averaging into index funds and casts doubt on the notion that you can easily beat the market through careful research to pick “the right” stocks rather than simply buying the entire market through low-expense index funds.

At $5.50 for a hardcover edition, the price is right, too!

Comment by suite Joey blue eyes (csn&y superfan)
2014-01-20 10:56:52

Burt malkiel was a good prof. His wife nancy was one of my deans at some point, i forget her exact title. Both are retired now.

Jack bogle (vanguard founder and ceo) had burt as a college prof and they were friends long after.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2014-01-20 11:01:48

That’s cool — thanks for sharing!

 
 
 
Comment by Interested Observer
2014-01-20 11:01:16

Try Andrew Tobias’ book, “The Only Investment Guide You’ll Ever Need”. It taught me how to dollar cost average and I’ve done very well with that over the years.

Also, buying into a market that’s at it’s peak is always tricky. So, perhaps putting in a set amount per month would help smooth out any down turn. Or, just wait a few months to see if a correction appears - one is definitely due.

Finally, check out Bankrate.com to find a bank paying the best rates at this point if you want to park some of it.

Comment by Whac-A-Bubble™
2014-01-20 11:02:59

Ya gotta love an investment book which recommends investing in canned tuna as an inflation hedge! (On that recollection, I’m stocking up on the stuff over the next few months…)

(Comments wont nest below this level)
 
 
Comment by Mr. Smithers
2014-01-20 14:14:14

The next door strategy is be a millionaire while living like you make $10/hr. So exactly what’s the point? It’s the same silliness that Dave Ramsy spews. Be debt free, be “rich” and drive a 1987 Camry with 300K miles on it while eating rice and beans.

 
 
Comment by HBB_Rocks
2014-01-20 12:44:12

If you’ve had a decent job a few years and have no personal investments beyond your 401k, man, you really need professional help. You should have been making personal investments for the past several years that would have helped you get a handle on how you feel about investing and your personal risk strategy, and if you’ve had a decent job for around a ten years, you should have had somewhere around 15-25% (or more) of that sum invested on your own.

So you can’t evaluate either BIL’s or Smithers advice at face value, because you are lower on the risk profile than either of those strategies. What do you have your spare cash in? Just the bank? Before this, did you have any spare cash?

Comment by Brett
2014-01-20 14:47:34

I invest in my 401k and save as much as I can, but don’t invest it.

Right when I got out of school, we were faced with the financial crisis, which kinda scared me off so I stayed away from housing and stock. I’ve focused a lot in my job performance and personal life.

You’re right. I have money parked out of fear. This extra money that I got has only contributed to my fears.

Comment by HBB_Rocks
2014-01-20 15:13:50

There’s nothing wrong with not investing in anything, you just have to figure out if your current strategy is what you want your future strategy to be and follow your strategy.

The amount invested shouldn’t change your strategy barring some huge amount or some planned life event comes along.

It seems like a lot and it is but $500k is not alot if you were looking to live on it for the rest of your life, so it doesn’t count as huge, especially for someone interested in downtown lifestyle which costs money.

I don’t think you should be pushed in any direction, but have you ever needed $500k cash before in your life so far? Anything even close to that? Do whatever allows you to sleep at night. If you are scared to lose money, then keep it all parked in banks.

IMO, if you are parking it to clean up in some future unexpected financial crash, that’s pretty much the same as Smither’s investing 100% of it in a fund tomorrow. You’re trying to predict the future.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2014-01-20 17:55:31

“…have you ever needed $500k cash before in your life so far? Anything even close to that?”

I’d suggest keeping a year’s living expenses (whatever that is for you — maybe $50K?) in some form which is liquid and safe, then gradually going out the risk / reward spectrum with the rest of the money. If you don’t put it all to work at a point when the market is historically overvalued, and you rebalance over time to keep an asset allocation that lets you sleep at night, you will do better over the long run than just keeping all $500k parked in something which seems safe but may not return enough to keep pace with inflation.

 
 
Comment by Whac-A-Bubble™
2014-01-20 17:52:21

“I’ve focused a lot in my job performance and personal life.”

Those are two very worthwhile investments which money cannot buy!

(Comments wont nest below this level)
 
 
 
Comment by Rental Watch
2014-01-20 12:54:24

Forgive my stream of consciousness…my thoughts are based on my understanding that you are relatively young.

No nothing for a while (3-6 months at least). Put the money into a high quality money market (backed by US treasuries if possible), or a major bank (BofA, Wells Fargo, etc.). One of the TBTF institutions. Or better yet, split the cash into more than one bank account, staying below FDIC levels in all cases.

Spend a little bit of money and go talk to a “fee only” financial planner.

Then talk to another one. And another one.

Despite them all telling you to invest in something other than cash, don’t. Wait some more. Keep your job. Read some investment books. Listen to Motley Fool and other Podcasts. Ignore people who are into quick moves in and out of the market. Google search for “Dividend Champions”, look at the list of long-standing companies. Read some financial statements (10Qs, etc.). Read newsletters from guys like Jeremy Grantham (GMO).

Invest only when you can do so with eyes wide open that the market does not only go up. The most successful investors have the intestinal fortitude to be able to sell despite the market continuing to go up, and to buy when fear is at a max. If you think you can do that, then time to dip a toe in the water.

Invest for the LONG term, don’t look month to month, or even year to year. Proper investing is a “get rich slow” scheme.

When you do begin to invest, invest one of two ways:

1. With very solid companies that are expected to be around and growing for a long time (”Dividend Champions” aren’t a bad place to start looking for such companies). Invest with at least 5-10 year time horizons, if not longer. To get pretty good diversification, you don’t need to own 100 companies…investment theory says that 15 will do fine…double that number to make sure;

or

2. With very low fee ETFs or Mutual funds (try Vanguard). Invest with at least a 5-10 year time horizon.

If you can, don’t spend a single dime of the money. Pretend you never got it. Invest it all when you are ready (best to be done at another time when there is blood in the streets, but who the hell knows when that will be).

Over time, convert the 401k (assuming that it’s NOT Roth) to a Roth, with an eye toward minimizing the tax hit. Speak with a tax accountant. It is possible that you have a basis equal to the value upon your receipt…if so, confirm with your tax advisor that there would be no tax hit, and convert it immediately…you would have no tax then going forward.

Don’t be hasty. This could end up being a GREAT nest egg when you fast forward 30 years.

Comment by Rental Watch
2014-01-20 13:11:22

By the way, my advice comes from some experience with people who inherited money.

My grandfather had two siblings. The three of them inherited some wealth and they took three different paths with the inheritance.

My grandfather spent the money on stupid stuff (their house was full of ugly artwork, etc.), and he died with close to nothing.

My great aunt never took the time to get educated about what she had or how to manage the money, and so she lived her life assuming she was nearly broke, and afraid to spend any of her wealth. She died living in a paid-for house in Old Palo Alto (land probably worth $2-3MM), and a significant stock portfolio…constantly crying “poor”.

My great uncle invested as I noted above, in strong, dividend paying companies, never sold, only spend the income, occasionally would buy more in major dips. He lived a long, and very happy life, able to treat his family to vacations, had a vacation condo in Hawaii, retired relatively early. In retirement, he largely did what he wanted…and at the end of it all, he had quite a bit to pass on to his kids.

They all started at the same place. And all lived much different lives.

My great uncle (WWII vet who lived to his early 90’s) is the one to emulate.

 
Comment by Mr. Smithers
2014-01-20 14:20:57

“Despite them all telling you to invest in something other than cash, don’t. Wait some more.”

Until when? The perma-doom and gloom types always thing tomorrow will be worse than today.For you guys it’s never a good time to invest because that 90% crash is always just around the corner.

What I never get is why you guys aren’t making a mint shorting stocks? You’re always so sure that the crash is coming after all. Profit from it.

Comment by Rental Watch
2014-01-20 14:39:17

I’m fully invested in the markets, and have been investing in stocks since high school (I can still remember the first stock I purchased: Airlease…great dividend).

I have a VERY good sense of the ups and downs that the market can bring, and I’m at peace with the volatility that being in the market even at times such as these can bring.

Until someone who just came into a lot of money is comfortable with the volatility that the market can bring, they should keep the money safe. Once they are comfortable with those swings, then they can move into more risky positions.

Otherwise, there is a significant risk that the first 10% down move in the market causes the person to pull everything out, and not step foot back in the market again…potentially for years.

Waiting 3-6 months until one is comfortable with the volatility of markets, and then investing with eyes wide open with a long time horizon in mind is VASTLY superior to investing immediately before getting that comfort, seeing a 10% down move, and getting spooked out of the market for the next several years.

(Comments wont nest below this level)
Comment by Mr. Smithers
2014-01-20 15:34:47

Yeah but that 10% correction could come as easily tomorrow or the day after he invests 6 months from now. There’s really nothing gained by waiting.

And no I am not saying there is a 10% correction coming any time soon. I’m just using your hypothesis to make a point.

 
Comment by Pete
2014-01-20 17:33:53

“Yeah but that 10% correction could come as easily tomorrow or the day after he invests 6 months from now. There’s really nothing gained by waiting.”

I think RW is saying that with waiting, confidence is gained, and that confidence is very important. Wait a bit and learn about the market, then you won’t be so freaked out month to month. Your statement above is correct, but so much of it is psychological. Dive in right away and you might just freak out at the ups and downs of the market. Digest and learn first and potentially avoid going crazy. Sounds like good advice.

 
Comment by Rental Watch
2014-01-20 17:34:03

I agree with you.

My suggestion is only applicable for a person who does not have experience investing, and just came into a potentially life changing amount of money. This seems to describe Brett.

The only thing gained by education and patience is the confidence of the investor to NOT panic and sell if there is a downturn.

 
 
Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 16:12:51

In the words of Warren Buffett:

“I know what’s going to happen, I just don’t know when.”

And who is “you guys” anyway? I bought real-estate for dirt cheap during the crash. I’m not going to buy it now. I sold my stocks at the top of the last bubble. I intend to buy more when this one crashes. Who is a perma-doomer? Do you work for Bank of America?

(Comments wont nest below this level)
 
 
 
Comment by Anklepants
2014-01-20 13:20:06

Most important question, what are your goals? Kinda surprised no one asked that. Maybe someone did and I missed it.

 
Comment by Rental Watch
2014-01-20 15:16:49

One more thing:

Pundits who are “doom and gloomers” get more airtime on TV than people who say that things are OK.

Keep that in mind as you dive into the investment world.

Comment by Mr. Smithers
2014-01-20 15:38:35

That’s very true Rental Watch. And the other thing to keep in mind they also have a vested interest in the doom/gloom coming true. They’re not on TV simply as a public service to the masses warning them of awful things to come. They are invested in doom and gloom profitability, ie they’re short the market and stand to make a lot of money if the market crashes. So they do all they can to get people scared and either sell their holding or not buy in to begin with.

Not that they will ever tell you this of course….

 
Comment by Anklepants
2014-01-20 15:49:49

We are in year six since the 2008 crash. Despite all the talk of bubbles by some and many warnings popping up in the media, I think it is inconceivable for regular folks who just read the paper and a few things here and there to think that the stock market or housing could go back down again. They simply can’t get that in their heads. To them it was purely natural for things to go back up to “where they belonged.”

Comment by Whac-A-Bubble™
2014-01-20 18:06:39

‘To them it was purely natural for things to go back up to “where they belonged.”’

Fox Business
The Power to Prosper™
Fed’s Fisher Says QE3 Could Ignite Bubble
Published January 14, 2014
Reuters

The Federal Reserve should pare its bond buying as quickly as possible, even if doing so sends stock prices tumbling, because more bond buying risks inflation and makes an eventual exit from easy policies more difficult, a top Fed official said on Tuesday.

Richard Fisher, president of the Dallas Federal Reserve Bank and one of the Fed’s most hawkish policymakers, said that continued purchases by the U.S. central bank of Treasuries and mortgage-backed securities carries the risk of fueling an asset price bubble, though he stressed that no such bubble now exists.

“Were a stock market correction to ensue while I have the vote, I would not flinch from supporting continued reductions in the size of our asset purchases as long as the real economy is growing, cyclical unemployment is declining and demand-driven deflation remains a small tail risk,” Fisher said in remarks prepared for delivery to the National Association of Corporate Directors.

“I would vote for continued reductions in our asset purchases, with an eye toward eliminating them entirely at the earliest practicable date,” said Fisher, who rotates into a voting spot on the Fed’s policy-setting panel this year

The Fed is well into a second year of its third round of quantitative easing, the extraordinary measures known as QE3 which are aimed at pushing down long-term borrowing costs in order to boost hiring and growth.

Last month, nodding to a strengthening labor market, policymakers decided to trim the monthly purchases of U.S. Treasuries and mortgage-backed securities to $75 billion monthly, from $85 billion.

They also signaled they would likely end the purchases entirely later this year, but promised to keep interest rates low until long past that in order to continue to bolster growth.

U.S. stocks, which had risen throughout 2013, surged to record highs after the December decision, and continue to be at lofty levels that Fisher called “eye-popping” by some measures.

Fisher said he was pleased with the decision to begin reducing the program, though he would have preferred to slash it to $65 billion for starters so as to bring it to a close even faster. He has opposed the program from its beginning, saying it puts the nation at risk for inflation without being very effective.

The Fed’s balance sheet has ballooned to $4 trillion with the cumulative purchases from its three bond-buying programs undertaken since the Great Recession.

Adding more to it is “untenable,” Fisher said, because it risks fueling a rise in asset prices to unreasonable levels and complicates the Fed’s eventual exit from super-easy policies.

While stocks, bonds and other assets are not currently in “bubble mode,” he said, “one must be prepared for adjustments that bring markets back to normal valuations.”

Janet Yellen, who takes over as Fed chief after Jan. 31 when Ben Bernanke’s term ends, is expected to continue to pare the program and end it later this year, unless the economy takes a clear turn for the worse.

Fisher’s comments suggest that he will keep up the pressure to do so, even if markets react unfavorably.

(Comments wont nest below this level)
 
 
 
Comment by Anon In DC
2014-01-20 19:22:41

Brett,
OK to tell us on the blog about your inheritance. BUT if you have not told anyone don’t. Don’t tell your friends, neighbors, co-workers or relatives. Guess if you are married tell the spouse. But if you are just living together with a partner unless it has been very long term 15 - 20 years and seems stable don’t tell.

 
Comment by Bill, just South of Irvine, CA
2014-01-20 20:35:39

“I indeed received ~500k this month (~250k cash, 230k in 401k), and I am kinda lost.”

I assume the $230k in 401k is in stocks. Also it’s important to know if you’ve received this in an irrevocable trust. I have received my inheritance in 2001 in an irrevocable trust and it was all tax free.

What to do with the $230k part: First consult with a tax attorney. Don’t be afraid to spring $1,000 for this. Might be just $500. For a half hour session.

If that 401k is taxable when you withdraw it you might be better off keeping it as is. But you have the ability to move within asset classes without getting taxed. That is, if the tax laws make the decedent’s 401k now your legal 401k.So essentially you have 46% of that amount in a 401k - perhaps stocks and 54% in cash. It might be reasonable to just do nothing and keep it where it’s at. But I would not put the cash into stocks. I would be sure to have at least 54% of that windfall in cash. Then slowly move the cash (over 20 years) into stocks.

 
Comment by reedalberger
2014-01-21 01:14:28

Please donate to your local communist front group.

Comment by HappierShibe
2014-01-21 01:35:51

Brett, Brett, Brett…

If you’d only listened to me and put that 500K into Dogecoins two days ago, you’d be sitting on 3+ million bucks today. That’s right, from 58 Satoshis to 280 in just 48 hours. Biggest bubble of our lifetime and you’re missing it.

 
 
 
Comment by spook
2014-01-20 09:10:49

Its that time again thats right,

youknowhat hoax Monday.

The question for today is:

Did any companies advertise their product as one that went to the moon?

Im old enough to remember drinking Tang, but I can’t remember any commercial for a product claiming to have gone with the astronauts (specifically Apollo 11) to the moon?

Does anyone know of any examples?

Seems like a no brainer in terms of marketing potential?

Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 12:41:43

Weren’t they selling those freeze-dried ice cream bars for a while? I think they were advertized as “used by astronauts”, but I can’t remember if they were actual moon-landing astronauts.

Comment by spook
2014-01-20 13:01:39

Yeah I think a few food/dessert products claimed it, but I was really thinking in terms of mechanicals.

Hasselblaad was already a great camera, so Im not sure they need advertising.

Suposedly Kodak made the film and Playtex made the space suits.

Everytime the Olympics come around and Im hit over the head with THE OFFICIAL OLYPIC:

drink

car

mattress

condom

sandwich…

OF THE OLYMPICS

It makes me wonder?

Just think if you could have gotten Neil Armstrong to mention your product while he was walking on the moon?

Comment by "Uncle Fed, why won't you love ME?"
2014-01-20 13:14:31

Didn’t they start to make bicycles out of spaceship material? It’s like silk or something.

(Comments wont nest below this level)
 
 
 
Comment by Anklepants
2014-01-20 13:21:28

No MLK day theme for hoax Monday. Kinda disappointed.

 
Comment by Bill, just South of Irvine, CA
2014-01-20 20:36:58

There were some ink pens that were supposedly designed to work in zero G. Not sure if BIC or PaperMate.

 
 
Comment by Puggs
2014-01-20 10:13:43

We live on the west coast and while the weather is sunny and gorgeous this winter it’s also beyond strange. The current high pressure system off the coast is 4 miles high by 2,000 miles long preventing storms from entering the coast. Our oceans are over-acidic and warming. The west coast is toast this summer if we don’t get snow and rain soon.

Comment by Housing Analyst
2014-01-20 10:34:24

I’d have baled from CA within 24hrs of the Fukushima event.

Comment by Whac-A-Bubble™
2014-01-20 10:42:38

There is a lot of ocean between Fukushima and SoCal beaches!

Comment by Housing Analyst
2014-01-20 10:45:59

I don’t think the insider adage “dilution is the solution to pollution” works very well with rad.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2014-01-20 10:50:25

Having hiked numerous times in canyons around St. George, UT, I can only hope you are wrong.

 
Comment by Whac-A-Bubble™
2014-01-20 10:51:57

How about “diffusion’s the solution to pollution profusion”?

I realize it doesn’t quite have that ring to it…

 
 
 
 
 
Comment by robot
2014-01-20 10:18:48

Refighting the ‘mortgage wars’ could bring new risks to the housing market

In the five years since the 2008 financial crisis, there have been various attempts to make sense of what happened and why.

The latest — and, to my mind, one of the more convincing — comes in a new book, “Mortgage Wars,” by Timothy Howard, the former chief financial officer of housing finance giant Fannie Mae. Howard’s thesis is that the crisis was the result of a bitter and protracted political war that pit Fannie and its corporate cousin Freddie Mac against a group of giant banks and ideological foes determined to break their lucrative hold over the $11 trillion American home-mortgage market. In the end, Howard argues, the banks prevailed long enough to lead themselves and the rest of us over the cliff.

http://www.washingtonpost.com/business/refighting-the-mortgage-wars-could-bring-new-risks-to-the-housing-market/2014/01/17/7404c8a4-7e25-11e3-9556-4a4bf7bcbd84_story.html

Comment by Neuromance
2014-01-20 10:41:23

Put the patient on morphine without setting the broken bones and suturing the wounds, and he’s not going to heal very well.

Here are the conclusions of the Financial Crisis Inquiry Commission (FCIC) that politicians put together to investigate the financial crisis: http://fcic.law.stanford.edu/

Conclusions: http://fcic.law.stanford.edu/report/conclusions

Nothing surprising, but a data point nonetheless.

Comment by robot
2014-01-20 11:00:29

None of mention the core issue: CRA.

Comment by Neuromance
2014-01-20 19:39:06

CRA obfuscates the core issue. The core issue was the ability of loan originators to create loans and then sell them for a profit, while not retaining any repayment risk. This created perverse incentives to generate as many large loans as possible with no interest in whether they could be repaid or not.

The most curious question I had during the first bubble was, “Why would lenders make loans they don’t care about having repaid?” Because they could make a profit from it. How they did it is the core the housing bubble. And any debt bubble for that matter.

Bad loans were not just made to poor minorities. Lots of whites were seduced too. I know a couple.

(Comments wont nest below this level)
 
 
 
Comment by Puggs
2014-01-20 11:51:49

“Inside Job” is a great comprehensive overview of the debacle too, for those who don’t care to read or have short attention spans - which is 90% of America.

Comment by Anklepants
2014-01-20 13:38:08

Here’s an even shorter version for trying to “make sense” of something that seems irrational: Assume somebody got paid.

 
 
 
Comment by Whac-A-Bubble™
2014-01-20 10:58:36

Bubbles, Bubbles Everywhere
John Mauldin, Thoughts From The Frontline
Nov. 3, 2013, 7:07 AM
John Mauldin is a bestselling author and financial advisor. He publishes a free weekly email on the economy–”Thoughts From The Frontline”

The difference between genius and stupidity is that genius has its limits.

– Albert Einstein

Genius is a rising stock market.

– John Kenneth Galbraith

Any plan conceived in moderation must fail when circumstances are set in extremes.

– Prince Metternich

You can almost feel it in the fall air (unless you are in the Southern Hemisphere). The froth and foam on markets of all shapes and sizes all over the world. It is an exhilarating feeling, and the pundits who populate the media outlets are bubbling over with it.

There is nothing like a rising market to help lift our mood. Unless of course, as Prof. Kindleberger famously cautioned (see below), we are not participating in that rising market. Then we feel like losers. But what if the rising market is … a bubble? Are we smart enough to ride and then step aside before it bursts? Research says we all think that we are, yet we rarely demonstrate the actual ability.

This week we’ll think about bubbles. Specifically, we’ll have a look at part of the chapter on bubbles from my latest book, Code Red, which we launched last week. At the end of the letter, for your amusement, is a link to a short video of what you might hear if Jack Nicholson were playing the part of Ben Bernanke (or Janet Yellen?) on the witness stand, defending the extreme measures of central banks. A bit of a spoof, in good fun, but there is just enough there to make you wonder what if … and then smile. Economics can be so much fun if we let it.

I decided to use this part of the book when numerous references to bubbles popped into my inbox this week. When these bubbles finally burst, let no one exclaim that they were black swans, unforeseen events. Maybe because we have borne witness to so many crashes and bear markets in the past few decades, we have gotten better at discerning familiar patterns in the froth, reminiscent of past painful episodes.

Let me offer you three such bubble alerts that came my way today. The first is from my friend Doug Kass, who wrote:

I will address the issue of a stock market bubble next week, but here is a tease and fascinating piece of data: Since 1990, the P/E multiple of the S&P 500 has appreciated by about 2% a year; in 2013, the S&P’s P/E has increased by 18%!

Comment by azdude02
2014-01-20 17:12:06

dont forget stocks are simply pieces of paper bought on the hope of rising prices.

They are suppose to represent equity in the company. people are throwing money at stocks that are insolvent. It is sure madness cause prices have been going up with support of the central bank.

at least you can live in a house.

Comment by Housing Analyst
2014-01-20 17:49:52

Hang onto your cash. You’re gonna need it in ways you can’t imagine.

 
 
 
Comment by Housing Analyst
2014-01-20 11:22:48

I’m wagering NAHB is equally as corrupt as NAR.

Comment by azdude02
2014-01-20 17:14:21

where you putting your money buddy? Do you have a hole in the ground or hole in a mattress?

Would you let a bank use your money for < 1% return?

Comment by Housing Analyst
2014-01-20 17:15:58

Why risk the losses on a depreciating asset like a house?

Comment by azdude02
2014-01-20 17:28:16

I understand your stance is but you say your in cash. where do you store it? Do you let the bankers use your money for nothing?

(Comments wont nest below this level)
Comment by Housing Analyst
2014-01-20 17:45:10

Stance?

 
 
 
 
 
Comment by phony scandals
2014-01-20 15:25:43

$84,000 down and you save $80 a month on a townhouse that according to the comments is in a bad location.

Rent or buy? Running the numbers on an Alexandria townhouse

By Kathy Orton January 16 at 5:30 am

In this market, it’s not always easy to tell whether it makes more sense to rent or buy. With the help of Zillow, a real estate information Web site, we decided to compare a property that is listed both to rent and to buy and see which is the better deal. In the case of this Alexandria townhouse, the difference between owning and renting appears slight.

The three-bedroom, four-bathroom home is listed for sale at $420,000, or you can rent it for $2,250 a month. Built in 2003, the 1,416-square-foot townhome is in the Grove at Huntley Meadows community, south of the Huntington Metro and near Old Town Alexandria. The home has hardwood floors on the main level and carpeting on the upper level. The kitchen has granite countertops and stainless steel appliances. The master suite has a walk-in closet and a master bathroom with a double vanity, soaking tub and separate shower. The spacious deck overlooks a grove of trees. The listing agent is Gary Eales of Long and Foster.

The Zillow data assumes that a buyer would have a credit score between 700 and 719, make a 20 percent down payment of $84,000 and take out a 30-year fixed-rate mortgage at Monday’s rate of 4.28 percent. Taxes, home owners association fees and home owners insurance (an estimate based on insurance premium data from the National Association of Insurance Commissioners) are included in the calculation, but not the tax benefits of buying (e.g., mortgage interest deductions).

This rudimentary calculation is meant to give potential buyers or renters a snapshot of the costs involved with buying or renting a home. It is not meant to be a comprehensive accounting. Anyone considering a home purchase should also take into account the tax benefits available as well as other factors such as how long they intend to live in the home.

Address: 7588 Great Swann Ct., Alexandria

Sale price: $420,000

Monthly principal and interest: $1,659

Monthly taxes: $340

Monthly home owners insurance: $62

Monthly home owners association fee: $109

Estimated total monthly costs when buying: $2,170

Monthly rent: $2,250

http://www.washingtonpost.com/blogs/where-we-live/wp/2014/01/16/rent-or-buy-running-the-numbers-on-an-alexandria-townhouse/ - -

 
Comment by phony scandals
2014-01-20 15:39:44

DHS Gave Muslim Brotherhood VIP Treatment, No TSA Pat Downs

Document reveals delegation was allowed to skip secondary screening

Paul Joseph Watson
Infowars.com
January 20, 2014

A newly released document obtained via a Freedom of Information Act request confirms that the State Department ordered the Department of Homeland Security to spare members of the Muslim Brotherhood traveling to the US in 2012 a TSA pat down or any kind of secondary screening.

The one page document (PDF), obtained by the Investigative Project on Terrorism, shows that members of a Muslim Brotherhood delegation traveling through Minneapolis Airport, New York’s John F. Kennedy Airport and Dulles Airport were handed expedited entry known as “port courtesy,” which is normally reserved for high ranking government officials and dignitaries. At the time, the Muslim Brotherhood’s candidate Mohamed Morsi, later deposed, had not been elected president.

The document contains four separate entries which include a directive that Muslim Brotherhood members, “not be pulled into secondary upon arrival at a point of entry.” As well as a TSA pat down, secondary screening involves carry on luggage being inspected by hand and the use of puffer explosive detectors.

Two following entries confirm that Muslim Brotherhood members traveled through both JFK and Dulles Airports “smoothly” and “without incident” after the DHS had been alerted about “port courtesies”.

Another entry reads; “MB delegate departure: In response to a request from the MB, the desk worked with the office of Foreign Missions to arrange for TSA to escort the last member of the visiting MB delegation, Abdul Mawgoud Dardery, through security at Minneapolis Airport and JFK Airport on April 15. We did not hear anything further from the MB, so we assume the departure went smoothly. In the coming days, we’re going to write down a list of procedures for dealing with MB visits to the United States.”

The delegate was given privileged access despite one of their members being linked to a previous child pornography investigation in the United States. In addition, the Muslim Brotherhood, which has now been declared a terrorist organization by the Egyptian government after bombing a police HQ last month, is closely affiliated with Al-Qaeda and has long been cited as the foundational inspiration for both Al-Qaeda and Islamic Jihad.

The IPT also highlights the fact that individuals traveling from Syria to give speaking tours in the United States, people like Sheik Osama al-Rifai, that have openly endorsed Al-Qaeda militant groups under the banner of the the Islamic Front, are being handed visas by the State Department with no questions asked.

While completely innocent Americans continue to be subjected to invasive TSA grope down procedures and placed on no fly lists for no reason whatsoever, members of a group with direct links to terrorism were given VIP treatment by the State Department, the TSA and the Department of Homeland Security.

 
Comment by phony scandals
2014-01-20 15:58:12

Cuomo: ‘Extreme Conservatives,’ Pro-Lifers Not Welcome in NY

Cortney O’Brien | Jan 18, 2014

“The Republican Party candidates are running against the SAFE Act — it was voted for by moderate Republicans who run the Senate! Their problem is not me and the Democrats; their problem is themselves. Who are they? Are they these extreme conservatives who are right-to-life, pro-assault-weapon, anti-gay? Is that who they are? Because if that’s who they are and they’re the extreme conservatives, they have no place in the state of New York, because that’s not who New Yorkers are.”

 
Comment by Housing Analyst
2014-01-20 17:10:09

What kind of fraud has Freddie and Fannie perpetrated on the US taxpayers?

Comment by azdude02
2014-01-20 17:32:28

lots more money than will ever be made off buying loans that will default.

 
 
Comment by Housing Analyst
2014-01-20 17:14:31

Arlington VA Housing Prices Down 11% As Inventory Blooms

http://www.movoto.com/arlington-va/market-trends/

 
Comment by Whac-A-Bubble™
2014-01-21 00:06:40

Jan. 20, 2014, 6:45 p.m. EST
Next cut in Fed bond buys looms
Reduction to $65 billion could be announced on Jan. 29
By Jon Hilsenrath

The Federal Reserve is on track to trim its bond-buying program for the second time in six weeks as a lackluster December jobs report failed to diminish the central bank’s expectations for solid U.S. economic growth this year, according to interviews with officials and their public comments.

A reduction in the program to $65 billion a month from the current $75 billion could be announced at the end of the Jan. 28-29 meeting, which would be the last meeting for outgoing Chairman Ben Bernanke.

The Fed has been buying Treasurys and mortgage bonds in an effort to drive down long-term interest rates and spur spending, hiring and investment. Last year the Fed spent $85 billion a month buying bonds. Bernanke suggested at a December news conference that officials were inclined to continue cutting purchases in $10 billion increments at subsequent meetings as long as the economy keeps strengthening.

“We’re likely to continue on a path of gradual, measured reductions in the pace of purchases, assuming the economy tracks as we expect it to,” San Francisco Fed President John Williams said in an interview early in the month.

Bond buying is one of two prongs in the Fed’s strategy to boost the economy. The other is low interest rates, and Fed officials are once again debating how best to describe their plans for when they eventually begin raising short-term rates.

 
Name (required)
E-mail (required - never shown publicly)
URI
Your Comment (smaller size | larger size)
You may use <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong> in your comment.

Trackback responses to this post