Replies to post #422 on Golden Jackass Tobacco Shop

[Frank Pembleton]

Kastel, this is my first mania-- I have a tendency of buying when the market is weak, and selling out when the market is even weaker. For what ever it's worth, real-estate has been a piss poor investment for me-- hit and miss at best.

If you still remember, early in the year I sold my condominium, thinking that the world was going to go bust within a 6 month time frame. Anyway, I found myself homeless after putting the unit for sale and then seeing it sold the next freaking day.

Too much Puplava, maybe even too much coffee.

I sold too soon. I realised that when I went out and looked for somewhere to rent. But it all worked out, bought the old house a week later - a cozy two story with a North/South facing 50'x150' lot in the downtown core of Edmonton.

Love the house, love the area and if silver ever gets to $150 an ounce, I'll knock the old barn down and get a new one built on my perfect lot.

Regards,
Michael

[JimWillieCB]

Kastle, real estate will hit a sudden brick wall
rates will shock the housing sector very soon
I seriously doubt we will see RichRussell's expected 3.0%
a combination of three things will kill real estate pronto

1. jobs are fast slipping away from the adult public, as corporations are running out of time and ideas and alternatives for shoring up profitability... their only outlet soon will be layoffs, since economic recovery is now out of the question sadly

2. rates will not come down with lower TENS yield, and will rise with higher TENS yield due soon... a huge wide crack hit the TENS in the last two weeks, with yields rising from 3.6% to 4.1%... that popping sound is the broken bubble in bonds

3. MortgBacked bonds are about to get creamed, as default rates are fast rising, word is getting out, the games of POWER mortgages are known as a gimmick... as layoffs mount further, delinquency and default will shatter this bubble quickly... with failing MB bonds come tighter lending requirements which have to date gone from liberal to insane to outright fraudulent

we are just about here with the last bubbles getting flattened
huge supply of new homes and existing homes will flood the market
gonna be tragic for layoff victims who recently bought with zero downpaymt
gonna be horrible for homebuilders
gonna be tough on anyone who bought after June 2001

this will feed upon itself viciously
everything about the dollar-based vicious cycle will be utterly vicious
as RE prices come down, spending reduces, jobs are shed, incomes drop, defaults rise, MortBack securities fall, rates rise, RE prices come down further
and meanwhile, the dollar will come down and break support at 104
then Trez yields rise, pushing mortgage rates higher still

the center of the upcoming storm will be the dollar and bonds
when either Trez bonds or MortgBackeds falter, it is all over
what Gross doesnt mention is that the end of the USTBond rally signals resumption of the USdollar decline
with the dollar decline comes failure of Dow/S&P soon, very soon

look out beloooooooow
/ jim