Stocks vs real estate


I do not prefer Trump compromise with Congress, but he has to bring congress into his side ! This is a real challenge for many presidents !


Congress is full of dirtbags…LBJ used FBI files to backmail and force them to act… .Obama and Carter were to wimpy to push congressmen around…Maybe Trump can kick ass…we will see



Makes sense. The companies want you to own their stock, so they pay a dividend. Tenants don’t want you to own the house they’re renting. They pay you rent. And then try to get rent control instituted.


Trump’s style (ref: art of the deal)


I just read this now. This is interesting. It is kind of like Chinese negotiation mentality: I win, you lose. Whereas most American companies do not play games and just negotiate more reasonably, more like in I win, you win, we all win.

In my work in electronics industry, we deal with Taiwanese and Chinese companies. These are large companies with 10’s of $B in sales and over $1B in profit. But when it comes to deal making, they are so ridiculous and childish. The company I worked at was not small either, with sales in $B’s. And the product is unique that there is really no 2nd source.

Here is how the negotiation went in 1 case… The amount of the product in question was around $10M. They started with $1. After the negotiation didn’t go anywhere in 20-30 minutes, they said we have to pay them $250k to have them buy/install our product. Then they walked out of the room. And this was not a new customer. But every round of negotiation is similar. And of course it ends up at market price; never drop in base price; but discounts/credit are given for volume.

Now thinking back, I can imagine Trump’s face in those situation. A lot of tough talk, a lot of show, but won’t make a bit of difference.


Trump is not a master negotiator. No master negotiators go bankrupt, let alone multiple times. To be good at making deals, one needs to know the details, what to give and what to take. If people can’t agree on price, perhaps there are some other aspects? Like how about we help with the kids of the Chinese company’s boss get in a good college in US? Legally of course.

Trade deal negotiations like the PPT are truly master class. How you brought 10s of countries to sign off on a deal is extremely difficult. It’s a shame we just casually threw that away.


You are so kind. I have intentionally just said I agree with the author without explaining why.


In America win win negotiations make business smooth and easy…Trump uses third world negotiating tactics. …Makes business dealing difficult. …America is headed in that direction. .50 years ago a handshake was all that was needed…Now complex contracts with dozens of pages and lawyers hours have made business more difficult and expensive…Look at real estate. .My parents bought their house in 1961 with a half paged hand typed contract. .Now the standard CAR contract is 10 pages with hundreds of pages bullshit disclosures …Trust goes out the window when you use Trump tactics. …Once trust is gone nobody wins…I got a house once because the seller hated the other competing buyer, who was known for Trump style negotiating


How can anyone with the right mind start with $1 for a product worth $10M. Is this for real?


I read his first two chapters including this page. He may be good on business deals, but that will not fly away with congress.

On any case, with current bombing at Iran, IMO, Trump is making big moves and high risk for USA !

This may give him either better position or worst position (if it ends up big war) in the history. He may forget all local jobs and miserably end up fighting with many enemies with his whole term !


Yes, this is for real. That company’s procurement/buyers actually go thru training classes to learn these tactics. It is to beat up the suppliers, attack their confidence, make them feel insignificant, etc. This is all to make each supplier feel that they are no different than any other suppliers (no product differentiation). I heard this strategy came out of the US auto industry.

This company spent hundreds of $M annually buying from company I worked at. Even if they saved a few %, that is several million $ savings. So I don’t blame them for trying.


I do not really care about stocks any more. Most people made money from real estate. I know many successful RE investors or homeowners, but not a single successful stock investors who made enough money to buy a house with cash. The only people who made a lot of money from stocks is from stocks options at work.

Most stock investors made less money than a regular BA homeowner.

Stock market is for old people who have too much money and not a lot of energy.


I am still to young to buy primarily stocks…lol…Long term plan is to 1031 out of California. .The convert my real estate into a REIT then sell off bits as stocks…


Real estate people can not hide. Many of my friends know how much real estate I have ! Easy to trace know the homes with a proper name is known as this public information.

We all do not know about stocks ROI as no one comes out and declare outside how much they made through stocks or options.

All I know is stock, carefully invested (like RE location), returns are higher than real estate, but stocks are normally not leveraged.

“single successful stock investors who made enough money to buy a house with cash” : When stocks are returning higher amount, people tends to invest more in stocks and hold minimum essential real estate.


If you want to be truly rich off the market, you need to be good enough to manage other people’s money.






Nice to read you guys put effort in learning your stuff.

I know old people in my community, they are retired, they bought stocks just for buying following their instincts and never went selling and buying. They are long time ex employees of Apple or any other tech company and they are living out of their winnings. I believe the long term of their stocks is what makes them winners, not the daily trade.

Remember that one of the very identifying aspects of the last bubble was the greed of people. The easy access to cash also helped to increase the bidding on properties, thus creating this fictitious sense of making money was too easy. And those caught at the end of the trade were the losers, those using the OPM, other people’s money, were the winners.

So, as an ignorant on the stock market and how you make your business, I would just say be cautious and read, and learn to identify the markers that will notify you of the impending crash, if any. You are a small fish on this ocean. There are high players in this stock market arena and they may be planning the next event that will make them winners.

Since I am a poor guy compared to you guys, I don’t have that much to lose, perhaps losing the equity on my home. But I can learn things from you.

Just a humble word of advice, don’t be too confident.


Agreed, I subscribe to your thinking always. You have to always be willing to look at it as a glass half empty as opposed to a half full. Nothing is a sure thing to me, until it is a sure thing (meaning signed on the dotted line and the cash is in your hands). I always look back to a very successful small but profitable sole proprietor business here in the Fab 7x7. This business honest to god was able to compete with the big boys, (Sears, Best Buy, etc). The guy built the biz from scratch and ran it for maybe 40-50 years. Well, the guy was too heavy into stocks. Stupid, you’re an old man, you need to be thinking capital preservation more, not focusing on appreciation rates. Well, you know the rest of the story. The market crashed and he was left penniless and probably died on the streets. Considering all that you had accomplished in that life, you’re going to piss it all away because you want to be greedy? Stupid…


This is for those who believe using leverage available for RE beats stock investment.

Assuming you’ve $1 mil cash in 2013, compare the following two options:

  1. Buy 10 houses in East Bay with 35% downpayment, each house costs $285k.
  2. Buy AAPLs at $57 without margin, cash only. AAPL price varied from $50.42 to $76.75.

Option 1, house now cost $450k each, so you gain 10 * (450-285) = $1.65 mil before tax.
Option 2, AAPL closed around $150 last Friday, so you gain (150-57) * 1 mil/57 = $1.63 mil before tax.

Despite not using leverage, investing in AAPL returns about the same as buying 10 houses with leverage.

Above computation and comparison ignore many complexities. However, conclusion of the comparison should be quite accurate.