The truth is Fed is your best friend for everyone !
If someone understands the surroundings, he/she will become wealthy, if they do not understand, they become poor.
Knowledge is essential, that is why we go to school, college…etc. For life and investment, it is crucial, but many lucky people disagree ! LOL !!
It is inevitable!
They don’t have to sell MBS. They have MBS that are maturing. They simply don’t buy more with the cash from maturing MBS. That’ll reduce the balance sheet. The reductions are tiny as a percent of total holdings.
That’s like saying corruption is good for everyone :-). Its not.
If you compare FED action to corruption, all governments are corrupted.
As I said previously, if you are not understanding surroundings, you will become poor and poor!
The macro world is a graveyard for people with analysis paralysis.
Right now you need to find a seller who believes the gloom and doom. Most stil believe their property is worth more than the April mythical high.
I have a deal we are working on . It was worth $380k in April, worth $350k. now. Seller wants $450k. I will let the market beat down his price… maybe in January. Of course by then if the bears on here are right it will be worth only $300k…. That’s my strike price. 5cap can rent for $2500.
Meanwhile there are other properties coming available. C
IMHO, JPowell (not sure about the Fed) is genuinely trying to unwind the printing. Is a difficult and long drawn process. However, he needs USG not to spend money carelessly… this is the hard part.
Seller wants yesterday price, buyer wants tomorrow price.
Really. Why is he not raising Fed rate to 5% then. He and other Fed members can do it. It will be well within their mandate of price stability and full employment, their mandate is not to inflate asset prices. He did not wait very long to drop rates to 0 and start QE so what is he waiting for now. The answer is obvious. Follow the action not the words.
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He can’t.
Obviously he has to.
Please don’t assume one action is exactly opposite to the other. Think about the example of a guy with student loan brought up by a blogger. He happily borrowed $ but refuses to repay the loan but instead spent on landscaping.
Thanks to US Govt. Its his price for his vote. Don’t blame him.
How would it serve the interests of Russian or China if the Dems were to lose?
US Govt will become lame duck and cannot do anything meaningful for the next two years, given that there is literally no overlap between dems and reps now. If dems will say A then reps will say B.
Again, how does that benefit the Chinese or Russians?
Currently we’re erasing our own border, inflation is out of control, we’ve lost our energy independence, we’ve botched the Afghan withdrawal and we’ve had two quarters of negative GDP growth. We’ve weaponized our justice system and combined the public and private sectors into a single blob - both hallmarks of nations on the road the fascism. Meanwhile our “woke” military has been so weakened that the army standard for push-ups is now 10 (ten) and 23 minutes to run two miles - standards I could meet and I’m a 58 year old retiree who pushed paper for 30 years.
Why would any adversary of the US want to upset the status quo? We’re busily engaged in an act of collective self immolation.
This is exactly how a democracy works with all checks and balances to have healthy country where consensus getting approved.
Obama’s second term faced exactly like this. But, economy revived during his second term and went up fast track so many years after his tenure. US govt becoming lame duck session is not an issue during recession recovery times.
According to Zillow estimate, prices of my…
CU SFH has tumbled 25% from Mar ATH. Y/o/y has declined too.
which is worse than my…
Austin SFH which has declined by 15% from May ATH. Y/o/y is still up.
You better return your Apple products and go cry.
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Since I buy n hold, price changes are not of high concern*, cash flow is more relevant. Lower house prices mean lower property tax which mean higher cash flow. Rent is less volatile so don’t expect much decline, if any, next year.
*It does limit my future cash-out re-fi.
Talking about cash-out re-fi, wondering whether any investors have too high LTV when they cash-out re-fi. Those have to top-up if value of house is less than value of the loan, right?
Why would you refinance if the value of the house is lower than the loan amount with these rates? Once you have the loan, they can’t make you payoff more to maintain a specific LTV.
It seems like Bay Area prices are rebounding. I am seeing several GOOD homes now often selling at near or in some cases even higher price than April ATH. Perhaps these are all cash buyers and they do not care much about Mortgage rates.
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What I meant is…
Must top up or not?
If yes, then…
would be in trouble if the house price continues to decline till the point where the value of house is less than value of the loan.
