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lower98th

lower98th
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  • Buy-And-Hold Returns? S&P 500 To 3000 By 2018 [View article]
    Hey: I thought you were a perma-bull.
    Apr 3 09:47 AM | Likes Like |Link to Comment
  • S&P 500 (SPY) records now and then: Corporate profits are 13% higher today than October 2007, says BAML's Savita Subramanian, concluding stocks are "still playing catch up to fundamentals." Additionally, the index's dividend yield is 30% higher now and the P/E ratio is well-below levels of 2007 and 2000. "Waiting for a better entry point can be dangerous," she advises. [View news story]
    Not sure that comparisons from bubble tops are very comforting.
    Apr 1 08:39 AM | 3 Likes Like |Link to Comment
  • Silver Bay Realty Trust - A Business Model Doomed To Fail [View article]
    Some counterpoints to this position:
    1. If residential rentals are a flawed business model, apartments share most significant components of that model.
    2. Maintenance expense issues have changed with the times, and in most states a comprehensive HVAC/appliance service contract sets and limits repair costs, with no service fee per call.
    3. Credit score is not the best indicator of willingness to pay rents. Most managements find prior rent payment history to be more indicative, as well as utility and car payments. Credit cards, student loan arrearages etc. aren't good indicators, and surprisingly neither is past foreclosure.
    4. Almost all investment companies are hiring local management with in house dwelling/comestic repair expertise and an approved pricing structure. The internet significantly offsets the "dispersion" risk, as video, etc. allows the "virtual" inspection of property.
    5. Rents won't keep up with inflation month to month? Year to year is to infrequent for rent increases? So far, this is not Weimar.
    6. Crowded market? Well apartments may be overbuilt, but so far no excess supply in detached single family rentals. The real pressure will be on multifamily as there is a strong preference for single family occupancy.
    7. Paying cash is more expensive than having to service loans? There are plenty of ways to hedge or even add leverage after the initial purchase...not that it is always advisable.

    I could go on. I have no comment on this reit in particular, but single family homes are no more inherently complex to manage than multi-family, agriculture, or commercial for that matter.

    If Mom and Pop can do it, professional management probably has a clue.

    And BTW, the exit strategy is no different that of any other rentier owner...make a income stream, and you can hold forever...like Buffet. Only sell when people are banging on your door.
    Apr 1 08:18 AM | 14 Likes Like |Link to Comment
  • Deposits over €100K at the Bank of Cyprus will be taxed at 62.5%, sources tell Reuters. The figure is far greater than officials originally indicated. Customers will get 37.5% of their deposits over the €100K threshold in bank shares while the remainder of their cash "may never be paid back."  [View news story]
    Very interesting article on how ECB cashed out/supported the Jr. Debt of Cypriot Banks, removing them as a cushion between the Sr Debt and the normally better insulated deposits. http://bit.ly/14DIcPp

    US bank model not so different. And now counterparty obligations here outrank deposits...Go JPM
    Mar 30 08:05 AM | 1 Like Like |Link to Comment
  • Deposits over €100K at the Bank of Cyprus will be taxed at 62.5%, sources tell Reuters. The figure is far greater than officials originally indicated. Customers will get 37.5% of their deposits over the €100K threshold in bank shares while the remainder of their cash "may never be paid back."  [View news story]
    Oh BT. What democracies? "Its not who votes that counts, but who counts the votes." Everything else is smoke and mirrors.
    Mar 30 08:00 AM | 1 Like Like |Link to Comment
  • As Farmer Incomes Rise, Rents Follow [View article]
    Based on history, as incomes rise, offers of easy financing become ubiquituous, followed by too much leverage for land, equipment and then widespread backruptcies. See early 1990's.
    Mar 26 08:46 AM | Likes Like |Link to Comment
  • Miles Kimball makes the case for a third term for Ben Bernanke: He “has developed an unparalleled skill in explaining and defending controversial monetary policy measures to Congress and to the public. The most important ways in which U.S. monetary policy has fallen short in the last few years are because of the limits Congress has implicitly and explicitly placed on the Fed.” [View news story]
    But, saying that national monetary policy should be dictated by and directed toward the least capable is simply unsupportable.

    Then lets fire them: they didn't see subprime coming, would be broke if not for government handouts, in jail except for crony protectionism. Yay Tack: the future and present should belong to the theives.
    Mar 23 12:28 PM | 2 Likes Like |Link to Comment
  • Miles Kimball makes the case for a third term for Ben Bernanke: He “has developed an unparalleled skill in explaining and defending controversial monetary policy measures to Congress and to the public. The most important ways in which U.S. monetary policy has fallen short in the last few years are because of the limits Congress has implicitly and explicitly placed on the Fed.” [View news story]
    Fed policies defined the system to be the elite banker class committing fraud at the expense of the people and what most would define as the nation: rule of law, property rights.. It would have been equally possible to unwind the kleptocracy while supporting the real banking system. The Fed has supported a horrible, predatory, despicable system of cronyism and graft. Something should have been saved, but not this.
    Mar 23 11:24 AM | 7 Likes Like |Link to Comment
  • Are The Markets Rigged? [View article]
    So markets are not rigged in the same way the Harlem globetrotters games are not rigged.....the outcome was just pre-determined.
    Mar 22 07:42 AM | 13 Likes Like |Link to Comment
  • The U.S. Housing Bubble Is Back [View article]
    "Suddenly, the market for single-family rental homes—unlike apartments, which cater to different people—has turned into an elbow-to-elbow affair." Richter

    It will be interesting to see if the new "large" landlords can turn this around. Renters prefer single family homes, but have concerns where standards and management have not been uniform. BX et al have an opportunity to take market share from the (overbuilt IMHO) apartment sector.

    And about income, etc. and rents. Not always what it seems. There is a robust income stream to be had from government rental subsidies. That, and not the free market, is the backbone of many apartment business models. Pretty sure that the big investors in single family will have this in their sights...where most small landlords don't want the paperwork.
    Mar 20 07:18 AM | 1 Like Like |Link to Comment
  • The U.S. Housing Bubble Is Back [View article]
    Its a bubble when the purchasers, en masse, are not the end users. There are other bubble metrics, but this one is always there.
    Mar 19 08:28 AM | 7 Likes Like |Link to Comment
  • Yes, Stealing Really Is That Bad [View article]
    I love ya Tom, but "stealing from the robbers" is a matter of perspective. You might think Russian money was stolen. I might think financial CEO's money was "stolen," or any US corporation offshore account that serves as a tax dodge should be in play. Witch hunts run by governments can mis-label any money to suit their ends. The ECB tentacles run deep, and black Russian money through Cyprus went everywhere....with the ECB's blessing. Bankrupt banks should follow the rule of law. Or maybe any account anywhere with suspected ties to Russia is fair game?

    Oh wait, (Sheldon) was that sarcasm?
    Mar 19 08:20 AM | 3 Likes Like |Link to Comment
  • The U.S. Housing Bubble Is Back [View article]
    1987 to 1990 = Savings and Loan Crisis.
    Mar 19 07:31 AM | 22 Likes Like |Link to Comment
  • Yes, Stealing Really Is That Bad [View article]
    If Russian money is bad, the Central Banks had much opportunity to refuse Russian deposits Europe-wide. After all, if its bad in Cyprus it is certainly bad in Spain, etc. And why stop at Russian oligarchs. The world is pretty mad at American oligarchs, not to mention Middle East oligarchs, African strong men, Drug money, Afghanistan/Iraq "where did that pallet go," etc. And if oligarch money is bad and you are stupid enough to keep your money in a complicit bank then you should have known what you were getting into.
    Mar 19 07:08 AM | Likes Like |Link to Comment
  • The 'Too Big To Jail' Red Herring: The Jamie Dimon Edition [View article]
    I would favor all CEO's having to defend themselves and pay for all legal costs and civil penalties out of their own pockets.
    Mar 18 01:46 PM | 3 Likes Like |Link to Comment
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