Carl leason

I Think the Fed Will Hold Rates Steady

Hi Keith, You are a prolific writer, for sure ! I subscribe to this site because it gives me a lot of "think time", from others who are in the financial markets. But some of the comments I read on Alpha are so full of it ,...not usually yours, but already some people are forecasting another huge drop in housing prices and frankly, I simply can't see that big a drop coming. Some additional drop may necessary but it will be a state by state situation , not across the board. The one thing that will prevent a huge drop in R.E. prices, is the drop in the value of our currency. It's fast approaching an exchange rate that will make US Real Estate appear like a bargain as compared to prices in other countries, primarily Canada and Europe. Forget about China for now,...it's still an unknown.
The only thing holding people back now is their opinion how long to wait before the "Bottom" arrives ! Then a look at Return on Investment will set the new floor on prices. I don't see the bottom that far off, perhaps a year or so but not a long wait. Some investors will always jump back into a market sooner than others , depending on their anticipated and accepted, return on investment. And, some sellers simply can't hang on much longer. but property is still a very safe investment for foreigners because of the stability of our country. LC

This Will Have Been a Buying Opportunity

Hi Keith,
The usual investors that arrived on the west coast of FL last fall didn't do anything but look,...
no buying activity ! I have seen a pick up in sellers who are willing to sell at almost any price, some people dug in their heels for a long time but are now getting tired of waiting for a recovery. I have sellers who have dropped their prices by 15 pct. but still no buyers. Most sellers now realize that the market is slow to nil, but are becoming willing to price property more realistically. People here (FL) have totally lost confidence in Gov. also and that isn't helping a bit ! The promised tax reductions have not materialized yet, even on the latest TRIM notices. Even my own home is valued higher this year and this in spite of the fact that home prices are down from last year at this time. For starters, I am going to vote against every
elected official in the state ! Being put out of office is the only thing these jerks understand !
I have recently seen some people "looking" which is a plus but really taking their time in making decisions ! Fortunately the "Flippers" of past years are gone , but I don't see a turn around for at least a year or more. Realistically, prices are still high when one looks at wages and , for investors, RETURN ON INVESTMENT just isn't there yet ! On the plus side, the weak dollar might get Canadians back into the market along with the English, Germans, etc. Lets also hope the Snowbirds are more optimistic this coming winter ! Regards, LC

Getting the Real Estate Crisis Right

Christian,...You are the first in a long time to really get it right !!! I see so much BS about the housing market that it's mind boggeling ! But You have it right on all points ! Makes me wonder what the other "experts" have been reading. All the talk about "corrections" and median prices as compared to incomes is simply analyzing and not looking at facts ! I have been in the R.E. Business for over 25 years and you wouldn't believe how many times I have been asked by people to "get them out of a contract" that they signed and put down a good deposit ! I keep telling investors to "Do the math".
but it seems that most Investors have a Herd mentality,...follow the friends actions , even if it's a dumb idea ! Thanks, LC
Thanks for writing ! LC

This Will Have Been a Buying Opportunity

Keith, I believe you are looking at the R.E.Market as a whole, certainly not state by state.
Also, Certainly we are not looking at a depression but it definitely is going to be a state by state adjustment,..perhaps I should have made myself clearer, but the CA, AZ , and FL markets are greatly different than , for example the Chicago market or NYC ! Unfortunately, I happen to be selling in Fl and it's going to remain a disaster here for some time ! Check it out ! LC

Gold, Silver ETFs Lead the Way Lower; Financials Gain

Nick,...You better wake up ! Like Jim said, this is pure specullation !
When times go bad, really bad,...do you think you can take a bar of gold to your local bank and get cash or go the local grocery and get food ? Get serious,...I could never figure out people who get involved in pure speculation. Like the housing bubble,...not braging but I saw that bubble coming when prices were on the way up ,..way, way up ! Housing is an easy one to "Do the MATH !" If you buy a home, especially as an investor, you better figure all the costs and the probable income, and then tell yourself if it will at the very least,...PAY FOR ITSELF ! Most of todays investors are of the "Herd" mentality,...if joe Blow says it's a good idea and Joe does it, then it must be great,...right ? WRONG,..if you don't do the math,...meaning calculating "Return on Investment ".... it can be a real disaster, like Gold and housing !!
Gold is worth only what people are willing to pay, which is truly dumb ! At least with housing, one can calculate what the return should be ! There are so many MILLION $$ waterfront high rise condos for sale all over, it's really mind boggeling ! What are these people thinking ? There is no way that one can put 20-30 pct. down and have rental income pay for it ! Think I am wrong,...then "Do the math " !!! LC

Where's The 'Equity Cushion' When You Need It?

Evaluate your position ???...... It's already done Bob !!!!
Believe it or not there are still some good funds out there paying good returns, but note I didn't say stocks,..I said funds !.... Paying 15-20 pct. Just don't invest in housing or REIT's !
LC

Housing Starts At 10-Yr. Lows: Cue The Tumbleweeds

I think a lot of R.E. Sales people , myself included, saw this coming, but who are we to tell people they are paying too much ? It may seem like the right thing to do but if we didn't sell them the home, it's dead certain that another salesman would, and tell me what person in his right mind is going to turn down a commission. ?
In fact, one has to remember that when you take a listing or are working for a builder,..you have a legal requirement to get the highest price possible.
The real problem is that people,..(buyers and investors ) were on a buying binge, regardless of cost thinking that they would just place the property right back on the market for a higher price. I could watch it happen, and buyers failed to do the math,...return on investment ???
Buyers and especially investors, must start learning to figure their return on investment,..the risk,...
But unfortunately, they don't,..at least not so far, They have a "herd" mentality,...follow the leader, even if it doesn't make sense. LC

Why The Bull Market Should Return

Alfred, the "going up" was very fast when it comes to housing prices, and now people are digging in their heels and waiting, ..if at all possible. Prices have come down a lot from the peak a year ago, but
,..if you do the math,...housing prices are still too high for the Florida economy especially, as this is a very low wage, retirement state. other states with a higher wage rate will recover faster than FL as
wages are higher in Northern states. Housing is very much a state by state thing where pricing is concerned. ...One can still buy a small ( 1300 sq. ft.) home NEW in Ga, S.Car, Tn, even places like Branson, MO for a cost of $130,000. while one cannot buy the same new home in FL for less than $200,000. and perhaps $300,000. in a place like Chicago.
When it comes to buying as an investment, using the home as a rental, the low wage states rent condos for $750. per mo. whereas high wage states would rent the same home for $1100. $1200. That greatly influences what a home is worth ,...right ?? The recovery is , in my opinion, going to be different in every state, depending on rents, wages, etc. In a place like FL with so many retirees, they can't wait for their Soc. Sec. benefits to go up !!! That would take forever ! LC

Why The Bull Market Should Return

Gary,..you got a lot to learn...Housing affects almost every industry from appliances, to carpeting, to Heating and A/C, to roofing, to landscapping, to the salespeople , etc....etc ! When people aren't making money they are not buying cars, taking trips, they are just trying like crazy to wait it out ! Even gasoline sales are down, refining capacity isn't that important anymore, all the impulse buying stops,...Just take a look at Home Depot STOCK ! Or LOWES STOCK ! BK HOMES STOCK ! LENNAR STOCK !
The only independent companies who are not affected that much by slow home sales are to some extent,..companies like Boeing, but check out Caterpillar........
So run that by again,..that it's a "Housing Bubble",...Not a stock bubble ??? LC

Auto Retail Industry Changing Faster Than Most Can Keep Up With

Just my opinion, but dumping the older , family owned delerships is a huge marketing mistake !
Carlysle Lincoln Mercury, Clearwater, FL almost folded when taken over by one of those "Autoway" or similar organizations. They salvaged it by hiring back the same old salesmen that had been doing a good job for years, were real profesionals and knew every customer by first name !
For most people, like it or not, buying a car is a very personal thing. A buyer likes to know that they remember him and will treat him right when it comes to service and the next trade. I went personally to an AutoNation or Autoway or whatever,..and found it so impersonal that I walked out ! In fact I even went to a third place that operated the same way,.."their way or no way".. attitude.
I walked all over the huge lot for a half an hour and not one person came out to meet me or to see if they had what I was looking for ! So again, I walked ! I finally went to a Family owned dealership and did buy a new car. !But, what do I know,..I am just a retired automobile / truck factory Rep . and finally a salesman for over 30 years.
Ford and GM must realize that it IS a very personal thing,...buying a car,..and when they dump the AutoNations, etc......... sales will pick up !! LC

Ford Motor Co: Have You Driven A Ford Lately?

Ford's real problem is not quality any more, it's simply that the Design Dept. hasn't come up with anything that really appeals to people,..For example , if the recent Thunderbird had been a 4 passenger, it would have been a real winner. But, they don't seem to realize that there are a million 2 passenger cars out there that people love until they want to take someone with them ! Then they go on the used car lot !
The 50's and 60's were great years for cars and are still favorites because cars were exciting and people couldn't wait for the next new model. Today, the next new model looks just like the last model,...and that model looks just like every other make on the road !
It takes an engineer to tell people what's different. That isn't the way to sell cars !
Those gas guzzeling pick-ups are not attractive, but appeal to those guys who want the biggest bus on the road, and they are really tough on the wallet when one buys gas ! The only thing they offer is a huge profit margin to Ford. ! When they start producing really attractive cars,... screw the wind cooefficient of drag,..that's when cars may start to sell ! LC

Ford Motor Co: Have You Driven A Ford Lately?

Ford's real problem is not quality any more, it's simply that the Design Dept. hasn't come up with anything that really appeals to people,..For example , if the recent Thunderbird had been a 4 passenger, it would have been a real winner. But, they don't seem to realize that there are a million 2 passenger cars out there that people love until they want to take someone with them ! Then they go on the used car lot !
The 50's and 60's were great years for cars and are still favorites because cars were exciting and people couldn't wait for the next new model. Today, the next new model looks just like the last model,...and that model looks just like every other make on the road !
It takes an engineer to tell people what's different. That isn't the way to sell cars !
Those gas guzzeling pick-ups are not attractive, but appeal to those guys who want the biggest bus on the road, and they are really tough on the wallet when one buys gas ! The only thing they offer is a huge profit margin to Ford. ! When they start producing really attractive cars,... screw the wind cooefficient of drag,..that's when cars may start to sell ! LC

Ford Motor Co: Have You Driven A Ford Lately?

Ford's real problem is not quality any more, it's simply that the Design Dept. hasn't come up with anything that really appeals to people,..For example , if the recent Thunderbird had been a 4 passenger, it would have been a real winner. But, they don't seem to realize that there are a million 2 passenger cars out there that people love until they want to take someone with them ! Then they go on the used car lot !
The 50's and 60's were great years for cars and are still favorites because cars were exciting and people couldn't wait for the next new model. Today, the next new model looks just like the last model,...and that model looks just like every other make on the road !
It takes an engineer to tell people what's different. That isn't the way to sell cars !
Those gas guzzeling pick-ups are not attractive, but appeal to those guys who want the biggest bus on the road, and they are really tough on the wallet when one buys gas ! The only thing they offer is a huge profit margin to Ford. ! When they start producing really attractive cars,... screw the wind cooefficient of drag,..that's when cars may start to sell ! LC

This Will Have Been a Buying Opportunity

Keith,....Wake up ! We have been in a true bear market for just about a year already and it ain't getting better any time soon. Too much on the market and still way too high priced. My credentials,...26 years selling R.E. and the past year is the worst I have ever seen ! What's going on now hasn't changed at all !
Still a huge over supply of homes, and builders are folding like crazy,...but you think it's a good time to buy ! Go for it.! No better way to learn than learning by mistakes ! LC

U.S. Trade Deficit Shrinks; GDP Outlook Bright

A one month "blip" in the trade deficit does not constitute a TREND !
Just tell me when you can go into any store, especially WalMart and find something that is not made in China or some other really low wage country. When I start seeing products NOT made in China in the big
stores, I'll start thinking that maybe a trend is started.
Another thing that blows me away is that a lot of people seem to think that a strong dollar is good,...when in fact, ...it's really bad for our job market and export market. LC