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Old 04-21-2013, 08:06 PM
 
244 posts, read 286,379 times
Reputation: 204

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Let's talk market manipulation...

All the great news about rising home prices creating a wealth effect is an overstatement, consumer debt remains double that of 2001. Yes, you heard me correctly... DOUBLE.

Stagnant wages, perpetually high unemployment, the high costs of necessities like gas, food, and health care, it's no wonder that consumer confidence has plummeted.

The coming disaster that is unfolding before our eyes is purely the result of government manipulation. There is nothing organic or permanent about this pseudo recovery. Once Bernanke is forced to end QE or ZIRP it's game over.

Didn’t we just learn a huge lesson regarding the government’s manipulation of the housing market in 2008? What makes you think this time it will end differently?

Economics 101:
EASY money creates an imbalance that flow to EASY profits creating a BUBBLE composed of money chasing profits like a dog chasing it's tail. Eventually, this artificially induced Ponzi scheme runs out of energy, like the dog. WHEN, not if, that happens the bubble bursts. RECENT history is REPLETE with examples, but, unfortunately, NOT people with the ability to learn from history.

There Ain't No Such Thing As A Free Lunch.
Vegas Vic
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Old 04-21-2013, 09:42 PM
 
64 posts, read 70,433 times
Reputation: 58
Homes are still selling below replacement costs (for the most part). How does that make them overpriced? I'm not an expert at investing in real estate or anything for that matter but buying something for less than it costs to produce seems like a good deal to me. Am I missing something? Also, much of the inventory is being paid for by cash. I think this creates an excellent foundation for a housing market because people don't walk away from homes that are already paid for.
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Old 04-21-2013, 09:54 PM
 
Location: really close to Mount Si
391 posts, read 866,113 times
Reputation: 339
SG,

See the below article (it is the same article that is linked to the "New signs of life arise in Las Vegas" thread that is also active in this sub forum). Pay particular attention to the second half of the article. That is one take on the artificiality of it.

New signs of life arise in Las Vegas - latimes.com

Figuring out whose argument is more valid is the crap shoot, isn't it.
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Old 04-21-2013, 10:04 PM
 
Location: ( ͡° ͜ʖ ͡°) (╯°□°)╯︵ ┻━┻ ̡
7,112 posts, read 10,877,506 times
Reputation: 3866
Quote:
Originally Posted by icarian View Post
SG,

See the below article (it is the same article that is linked to the "New signs of life arise in Las Vegas" thread that is also active in this sub forum). Pay particular attention to the second half of the article. That is one take on the artificiality of it.

New signs of life arise in Las Vegas - latimes.com

Figuring out whose argument is more valid is the crap shoot, isn't it.
" In 2006, Las Vegas had 112,000 workers employed in construction, a rate three times the national average. Today that number is under 35,000."




I don't think construction based employment will ever be that high again out here.


Motorola DynaTAC 8000x
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Old 04-22-2013, 01:10 AM
 
674 posts, read 756,587 times
Reputation: 429
Quote:
Originally Posted by VegasVicsezhowdy View Post
Let's talk market manipulation...

All the great news about rising home prices creating a wealth effect is an overstatement, consumer debt remains double that of 2001. Yes, you heard me correctly... DOUBLE.

Stagnant wages, perpetually high unemployment, the high costs of necessities like gas, food, and health care, it's no wonder that consumer confidence has plummeted.

The coming disaster that is unfolding before our eyes is purely the result of government manipulation. There is nothing organic or permanent about this pseudo recovery. Once Bernanke is forced to end QE or ZIRP it's game over.

Didn’t we just learn a huge lesson regarding the government’s manipulation of the housing market in 2008? What makes you think this time it will end differently?

Economics 101:
EASY money creates an imbalance that flow to EASY profits creating a BUBBLE composed of money chasing profits like a dog chasing it's tail. Eventually, this artificially induced Ponzi scheme runs out of energy, like the dog. WHEN, not if, that happens the bubble bursts. RECENT history is REPLETE with examples, but, unfortunately, NOT people with the ability to learn from history.

There Ain't No Such Thing As A Free Lunch.
Vegas Vic
Strongly agree with everything but I'm still glad I bought.
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Old 04-22-2013, 01:55 AM
 
244 posts, read 286,379 times
Reputation: 204
Manipulation?

Artificial Market Manipulation Won't Fix Las Vegas Real Estate IssuesG

"Sooner or later, individual home owners are going to be the minority. And when that happens, the real estate sales market — agents, builders, contractors, inspectors — are going to be led around by their noses on the finger of investment funds and institutional home owners. Consumers will no longer control the real estate market."

"When will we learn to leave well enough alone?"
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Old 04-22-2013, 03:23 AM
 
158 posts, read 167,817 times
Reputation: 104
Quote:
Originally Posted by VegasVicsezhowdy View Post
Let's talk market manipulation...

All the great news about rising home prices creating a wealth effect is an overstatement, consumer debt remains double that of 2001. Yes, you heard me correctly... DOUBLE.

Stagnant wages, perpetually high unemployment, the high costs of necessities like gas, food, and health care, it's no wonder that consumer confidence has plummeted.

The coming disaster that is unfolding before our eyes is purely the result of government manipulation. There is nothing organic or permanent about this pseudo recovery. Once Bernanke is forced to end QE or ZIRP it's game over.

Didn’t we just learn a huge lesson regarding the government’s manipulation of the housing market in 2008? What makes you think this time it will end differently?

Economics 101:
EASY money creates an imbalance that flow to EASY profits creating a BUBBLE composed of money chasing profits like a dog chasing it's tail. Eventually, this artificially induced Ponzi scheme runs out of energy, like the dog. WHEN, not if, that happens the bubble bursts. RECENT history is REPLETE with examples, but, unfortunately, NOT people with the ability to learn from history.

There Ain't No Such Thing As A Free Lunch.
Vegas Vic
OK, then what should people in Las Vegas do with regards to the homes? Rent, buy, or sell? I have bought a few rentals since 2010, but I will hold them until the price reaches ~75% of the peak value in 05 or 06. It's really interesting to see what happens.
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Old 04-22-2013, 03:58 AM
 
59 posts, read 79,963 times
Reputation: 87
The housing market is NOT the stock market. Housing must be based on affordability factors (salary being the prime issue, interest rates also, to a minor extend).
Housing appreciates 2-3% a year BECAUSE that is historically what salaries appreciate. This isn't rocket science my dear friends.

Wall Street tried to turn housing into another stock market and now there is another attempt to do that again. Pump the prices up and sell it to some poor soul.
We have to have prices return to the norm, or we all have to receive raises in pay and retirement pensions of 200%, so we can again afford American housing.

The geniuses on Wall Street miscalculated.

Last edited by Trader Joe99; 04-22-2013 at 04:18 AM..
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Old 04-22-2013, 04:25 AM
 
59 posts, read 79,963 times
Reputation: 87
Higher interest rates will kill real estate or housing interest AND will kill our baby recovery. When will housing reach a bottom: when interest rates are around 20%. Keep your powder dry.

Higher interest rates will force prices down rapidly.

The best time to buy is when interest rates are at the top of their arc and prices are at the low of their arc. Buy a house at the bottom with a high interest rate — and then begin to refinance as interest rates fall.

It is INSANE to buy an overpriced house when interest rates are low. Where do you refinance too? You can’t refinance when interest rates start rising and housing prices fall.

We have another big leg down as far as I can tell.
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Old 04-22-2013, 04:28 AM
 
59 posts, read 79,963 times
Reputation: 87
Quote:
Originally Posted by Trader Joe99 View Post
The housing market is NOT the stock market. Housing must be based on affordability factors (salary being the prime issue, interest rates also, to a minor extend).
Housing appreciates 2-3% a year BECAUSE that is historically what salaries appreciate. This isn't rocket science my dear friends.

Wall Street tried to turn housing into another stock market and now there is another attempt to do that again. Pump the prices up and sell it to some poor soul.
We have to have prices return to the norm, or we all have to receive raises in pay and retirement pensions of 200%, so we can again afford American housing.

The geniuses on Wall Street miscalculated.
Quote:
Originally Posted by TomKBL View Post
OK, then what should people in Las Vegas do with regards to the homes? Rent, buy, or sell? I have bought a few rentals since 2010, but I will hold them until the price reaches ~75% of the peak value in 05 or 06. It's really interesting to see what happens.
Ever thinking about that poor soul you are planing to unload your house?
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