Seems as if every previously empty plot of land is having a house built on it. Raising the interest rates last week seems to say that this time next year, that won’t be the case. I don’t know why , but I feel like we’re in 2007 and 2008 collapse will happen all over again next year. I’d struggle to sleep at night if I overpaid for a house the way many have the last 2 years
When I bought my house in 2004, the payments were $454 a month, and the Guy at Wells Fargo tried everything he knew to do, to talk me into an adjustable interest loan by telling me my payments are lower when the rate goes down. I said but if the interest rates go up, so does my payments right, then I said lets put me in a fixed rate bc I can pay the $454 a month if something happen to me, and I couldn't work. I injure my back in 2006 bad enough that it took me from a working man status, to a disabled status, and my house payments has never been a dime more than $454 a month, and I'm still living in my house 16 years later, and it will be paid off in two more years. Adjustable interest rates maybe good for the rich, but they suck for a working man that can be put out of work and lose everything in just a few short months. And I have been so happy that I didn't fall for that, but your payments could be cheaper if the rate fall.
For all you young guys starting out, and you're going to buy a home, get the interest rate as low as you can and lock it in. If the rates do fall to where it would help you a lot if you had a lower interest, refinance and lock it in again, bc you never know what can, and will happen like covid, or some country going into a long dragged out war that could hurt the American economy!!!!
Even without COVID many economist were expecting a roll back from the 2019 numbers that Trump had.
It was described to me as - Obama recovered from the 2008 recession and had the economy "burning a strong fire" then Trump came into office and threw pine trees onto the fire which did make it burn incredibly hot but if you have ever thrown a pine tree on a fire you know that once the pine tree is burn the fire isn't as strong as it was before.
We have experienced the largest distribution of wealth (from bottom to top) that the nation has ever seen. Why would you think that its sustainable?
Pine trees will burn up really fast, and your A$$ is freezing again!!! Plus they will cause a chimney fire from the sap build up, and that can cause you to really get hot bc it has cause the entire house to catch fire!!! Pine trees makes for cheap lumber, but it will burn with the quickness!!!
I moved into a new house in 1971, cleared a bunch of pine trees and burned the logs in November and December. On Christmas Day I wanted to get rid of the boxes and wrapping paper, so I started burning them in the fireplace. After the fire got really hot, creosote coating the flue started popping like crazy. I went outside and saw sparks flying out of my chimney and landing on the roof. So, I spent a couple hours of Christmas afternoon spraying my roof with a water hose.....
going about as well as could be expected. soon we should have those incredible “green shoots” of life returning to the economy with “Recovery Summer” after “Recovery Summer.”
along with “unexpected” disappointing quarterly numbers that constantly are revised down “unexpectedly” later, as opposed to the Trump numbers that were “unexpectedly robust” and having to be revised even higher later. Unexpectedly.
Yep, when it goes north on their shift, bet the farm they will blame the president before them, it's always their fault that it's screwed up their shift!!! Especially in the last several generations where the two parties will do the total opposite of each other, and wouldn't work together for the good of the people in no circumstances. It's no long we're the people for the people, it's my side does it the best, so we're changing everything you done, the good, and the bad!!!
This is looking more like Jimmy Carter years of 1976-1980 than 2007-2007. 1978 was 18% interest on a home loan and double digit inflation. When the price of gas goes up so does everything you buy because of transportation costs. Didn’t like Trump and don’t like Biden. Both parties want you to focus on the devil on the other side instead of what is good for the nation.
But at the end of the day, you can't sell and win. You have to hold your investments if you can, and ride it out.
The big banks (e.g. Jamie Dimon/Morgan Stanley, Goldman Sachs, etc.) instruct Biden, Powell/Fed, Yellen/Treasury, Gensler/SEC on how to handle policy. Then these government administrators go back to work for Dimon and the big banks and become bank board members upon completion of government assignments. Dimon met recently to advise Biden before he traveled to Poland to meet Ukrainian leaders. I'm saying it's stacked. The banks have the power and know-how, and government/political leaders are largely ignorant on financial/economic policies beyond filling their own pocketbooks.
The big banks are making hundreds of millions shorting the market and simultaneously advising retail investors to sell and reinvest their dollars at a loss. The banks and whales will let the Fed, Treasury, and SEC know when there is no more money to be made on shorts, and the market will go long and go up again. The top financial media (e.g. NYT, WSJ, WaPo, Barron's, etc.) are also on speed dial with the big banks for their stories. The devil's in the timing, but based on today's blood bath, my guess is this downturn will be dramatic and short (a few months) like the large downturn Mar 2020 timeframe. Hang in there Tigers!
I bonds are a solid investment in this market. 9.62% annual yield, backed by US govt. Can only buy $10k per year. Go on Treasury web site to purchase. I have been in the securities business for 40 years now and this market just feels different. Covid, Ukraine, supply line , it just seems like this one may last for quite a while. Unless most of your investments are in cash, higher interest rates don't help anyone. Adjustable mortgage rates increase and monthly payments get larger. New business growth and expansion is stifled because loan rates are more expensive and tougher to come by. According to many analysts, recent Tech earning were subpar, and more selling ensued. It is difficult to be constructive about equities in the current scenario. Americans predominately have their assets in the stock market(incl. 4o1k and IRA) and in real estate. The stock market is already down 20% from Jan 1. If rates continue to increase, the housing market will suffer as well. The one positive is that unemployment is at the lows, so Joe taxpayer may not have to sell off his IRA or house to pay for those exorbitantly priced groceries.
The current I-bond is paying 9.62% which can be had through October 22 via the Treasury Direct website. That rate is good if the bond is held for its five year term. If cashed out after the minimum one year holding period, the rate is reduced by 25% to 7.215%. There is a purchase limit of $10k per calendar year per SSN number. Was fortunate to buy near the limit last November and then in January. It's a good option for some folks.
Anybody else invest a lot in high growth stocks and cryptos? Because I'm getting killed.
My only hope is that all three of my growth stocks become profitable in 2023. Their growth rate is substantially higher than industry competitors. But the market has beaten them badly because their cash burn is still pretty high and they are unprofitable as of this moment. However, they all beat their Q1 estimates and profitability next year is a real possibility. They have enormous upside, but man, it's really bad right now.
I also have a significant amount of money in Bitcoin and Ethereum. Still love cryptos long term and BTC/ETH are by far the safest bets. Although I am Leon Trotsky, I love the idea of decentralized, competing cryptos over a centralized, fiat currency controlled by the Fed.
All I can do is hold and buy down my averages. Send a prayer for me. My goals are simple. My girlfriend finishes Medschool and begins residency in 2 years. I want to have my student loans paid off (40K), while also having enough for a down payment on a house (60K), and enough left over for an EV.