Stock Market Stinks (Down -800 points Today) - Real Estate Great
Specialist · Paradise Valley, AZ · Member since 2018 · 3k+ posts · 2k+ votes
Here we go - it's just the beginning . . . Is your Broker returning your calls?
"This Is The Tipping Point": One Bank Is Calling For A 30% Market CorrectionI thought I was seeing objects falling from skyscrapers in Manhattan until I realized these were investment bankers jumping out of the windows ....
Just kidding. We had 900 point decline in Feb and we are still standing.
HOWEVER, clouds are on the horizon
a) International markets have been routed - from 50% down in Asia and Russia to 15% down in Europe
b) Interest rates are climbing, 30 year mortgage hit -- shock, horror -- 5% again
c) Real estate markets in some regions are showing seasonal cooling down
d) Tariff wars
e) Oil prices rising
f) Employers cannot find employees
The next 12 months should be interesting ....
When the credit markets sneeze, the real estate market will catch a cold ....
@Justin Windham Points don't matter. Percentage matters.
That's true. I think this is only the 16th largest drop in history on a percentage basis.
Given that number 20 on the list is a drop of 6.91 percent, yesterday was way lower down on the list than number 16.
The only narrative that I had was to disagree with the statement that very few people made their money in Real Estate. It does not match the stats that Forbes published for 2016.
I also have not seen the statistics showing that any significant portion of billionaires have made their wealth through public purchased stock (stock not associated with their entrepreneur business). I did indicate almost 90% of billionaires did not have significant RE holdings. I did not speculate how most of those 90% earned their wealth other than that I though a lot were entrepreneurs (and disclosed this was speculation and that I had not seen any statistics on this).
Have you seen statistics showing that a significant percentage of the billionaires earned their wealth via publicly purchased shares (versus shares resulting from being part of the enterprise)? Or are you speculating that there are many billionaires that have created their wealth by public stock purchases? I am skeptical. The S&P has averaged under 10% since inception. It would be tough for many to generate great wealth with that rate of return. I know I do not consider an RE investment unless I project over 20% Short-term return on investment and typically achieve far greater (about half my RE purchases are on the infinite ROI). I do leave room for the Warren Buffets of the world, but there are not many Warren Buffets. So show me the evidence that a significant percentage of billionaires have created their wealth via public stock trades. Otherwise you should disclose that your statement is speculation and that you do not have any statistics to reference.
Note: Zuckerberg, Gates, Steve Jobs, Jeff Bezos, Pierre Omidyar, Steve Balmer, Steve Case, etc. did not make their wealth via public stock purchases but stock they receive from being part of the enterprise.
Have a great day.
If there is a market crash, don't kid yourself, it will be felt in real estate. Many markets have already seen some softening in REI as fall approaches and interest rates have risen. It just moves slower than the stock market, where you can see an instant impact from day to day. Watch days on market and price drops in your market.
To those who say, "it is just the beginning" of some huge market crash, that is totally baseless. Economic indicators are overall good. I love how people try to simplify it to "what goes up must come down". Look at either the stock market or housing over a long run and the trend is up for both. Of course there are pull backs (corrections) in the road up.
The only people who care when the market goes down is those who are selling, just like the housing market.
@Justin Windham Points don't matter. Percentage matters.
That's true. I think this is only the 16th largest drop in history on a percentage basis.
Given that number 20 on the list is a drop of 6.91 percent, yesterday was way lower down on the list than number 16.
Yes, I see that now. I was looking at the points chart and sorted by %. Looking at the % chart, you're absolutely right.
The only narrative that I had was to disagree with the statement that very few people made their money in Real Estate. It does not match the stats that Forbes published for 2016.
I also have not seen the statistics showing that any significant portion of billionaires have made their wealth through public purchased stock (stock not associated with their entrepreneur business). I did indicate almost 90% of billionaires did not have significant RE holdings. I did not speculate how most of those 90% earned their wealth other than that I though a lot were entrepreneurs (and disclosed this was speculation and that I had not seen any statistics on this).
Have you seen statistics showing that a significant percentage of the billionaires earned their wealth via publicly purchased shares (versus shares resulting from being part of the enterprise)? Or are you speculating that there are many billionaires that have created their wealth by public stock purchases? I am skeptical. The S&P has averaged under 10% since inception. It would be tough for many to generate great wealth with that rate of return. I know I do not consider an RE investment unless I project over 20% Short-term return on investment and typically achieve far greater (about half my RE purchases are on the infinite ROI). I do leave room for the Warren Buffets of the world, but there are not many Warren Buffets. So show me the evidence that a significant percentage of billionaires have created their wealth via public stock trades. Otherwise you should disclose that your statement is speculation and that you do not have any statistics to reference.
Note: Zuckerberg, Gates, Steve Jobs, Jeff Bezos, Pierre Omidyar, Steve Balmer, Steve Case, etc. did not make their wealth via public stock purchases but stock they receive from being part of the enterprise.
Have a great day.
Great Points!
The only narrative that I had was to disagree with the statement that very few people made their money in Real Estate. It does not match the stats that Forbes published for 2016.
I also have not seen the statistics showing that any significant portion of billionaires have made their wealth through public purchased stock (stock not associated with their entrepreneur business). I did indicate almost 90% of billionaires did not have significant RE holdings. I did not speculate how most of those 90% earned their wealth other than that I though a lot were entrepreneurs (and disclosed this was speculation and that I had not seen any statistics on this).
Have you seen statistics showing that a significant percentage of the billionaires earned their wealth via publicly purchased shares (versus shares resulting from being part of the enterprise)? Or are you speculating that there are many billionaires that have created their wealth by public stock purchases? I am skeptical. The S&P has averaged under 10% since inception. It would be tough for many to generate great wealth with that rate of return. I know I do not consider an RE investment unless I project over 20% Short-term return on investment and typically achieve far greater (about half my RE purchases are on the infinite ROI). I do leave room for the Warren Buffets of the world, but there are not many Warren Buffets. So show me the evidence that a significant percentage of billionaires have created their wealth via public stock trades. Otherwise you should disclose that your statement is speculation and that you do not have any statistics to reference.
Note: Zuckerberg, Gates, Steve Jobs, Jeff Bezos, Pierre Omidyar, Steve Balmer, Steve Case, etc. did not make their wealth via public stock purchases but stock they receive from being part of the enterprise.
Have a great day.
2018 list
https://www.forbes.com/forbes-400/#2fee461c7e2f
4 of the top 25 made their money primarily in stocks. Buffet, Dalio, and Simons for sure. I also include Paul Allen, who got a start with founding Microsoft, but if you at it percentage wise his investing has made him more. 4/25 = 16% that is a significant portion. To be fair, some billionaires have made their money in real estate, but no one in the top 25. One example is the Irvine company...they own most everything in Irvine CA, yeah that Irvine CA. Owned by 1 family.
Real estate is great, and can earn great returns, but it has its drawbacks. If you could really earn infinite returns on your invested capital you would be in that top 25% by now. There is plenty of reason to own both real estate and stocks.
Your Comment: "I am 34 and I have 330k in my retirement account." Correction, you USED to have $330k in your retirement account (Good job though, you are doing well and aren't part Ma & Pa investors I am talking about)
Stock Market is now down another -221 points today
Billionaires are a different class of people. They are investing way too much money to consider real estate. They have to buy things in bulk. It's silly to try to use them as a measure against ordinary investors.
Real estate is the safest, with most benefits, way for the ordinary investor to grow their portfolio. When investors hit a Billion dollars, of course they will look for other things to invest in. I will too. ;-)
The DOW has some nasty bearish indicators for this year. This isn't my specialty so I could 100% be wrong but the charts don't look good for 2019 I don't think
The only narrative that I had was to disagree with the statement that very few people made their money in Real Estate. It does not match the stats that Forbes published for 2016.
I also have not seen the statistics showing that any significant portion of billionaires have made their wealth through public purchased stock (stock not associated with their entrepreneur business). I did indicate almost 90% of billionaires did not have significant RE holdings. I did not speculate how most of those 90% earned their wealth other than that I though a lot were entrepreneurs (and disclosed this was speculation and that I had not seen any statistics on this).
Have you seen statistics showing that a significant percentage of the billionaires earned their wealth via publicly purchased shares (versus shares resulting from being part of the enterprise)? Or are you speculating that there are many billionaires that have created their wealth by public stock purchases? I am skeptical. The S&P has averaged under 10% since inception. It would be tough for many to generate great wealth with that rate of return. I know I do not consider an RE investment unless I project over 20% Short-term return on investment and typically achieve far greater (about half my RE purchases are on the infinite ROI). I do leave room for the Warren Buffets of the world, but there are not many Warren Buffets. So show me the evidence that a significant percentage of billionaires have created their wealth via public stock trades. Otherwise you should disclose that your statement is speculation and that you do not have any statistics to reference.
Note: Zuckerberg, Gates, Steve Jobs, Jeff Bezos, Pierre Omidyar, Steve Balmer, Steve Case, etc. did not make their wealth via public stock purchases but stock they receive from being part of the enterprise.
Have a great day.
2018 list
https://www.forbes.com/forbes-400/#2fee461c7e2f
4 of the top 25 made their money primarily in stocks. Buffet, Dalio, and Simons for sure. I also include Paul Allen, who got a start with founding Microsoft, but if you at it percentage wise his investing has made him more. 4/25 = 16% that is a significant portion. To be fair, some billionaires have made their money in real estate, but no one in the top 25. One example is the Irvine company...they own most everything in Irvine CA, yeah that Irvine CA. Owned by 1 family.
Real estate is great, and can earn great returns, but it has its drawbacks. If you could really earn infinite returns on your invested capital you would be in that top 25% by now. There is plenty of reason to own both real estate and stocks.
I like that you provided reference to the 4 of the top 25 that made a significant portion of their wealth on public stocks even though I am somewhat trusting you on the of the 4 (and feel comfortable doing so because you listed the actual people). I would have assumed Paul Allen made most of this money from MS but only an assumption. So all is good, but then you add ...
>If you could really earn infinite returns on your invested capital you would be in that top 25% by now.
I am not sure what you are saying. If I have nothing into an asset and it makes money then that asset has produced infinite return even if it only produced $1. You are confusing percentage and the actual financial gain on each. Infinite return does not guarantee that you can become a billionaire. You need the infinite return to also be a significant amount of money or a heck of a lot of smaller infinite returns to become a billionaire.
I suspect there are many investors on BP that have achieved infinite return on RE purchases that are not billionaires.
Almost half of my RE purchases have achieved infinite return on the amount I have invested in them (they have $0 of my investment in them). Unfortunately I am not on the billionaire list :=).
I think we are in for a wild ride @Account Closed Luckily I don't have much of a portfolio in stocks. But it will be interesting to see what the banks decide to do, and how it will effect the RE market.
https://www.forbes.com/billionaires/list/6/#versio...
I'm not sure why your using an out of date source (Forbe's 2016), the current 2018 edition, I'm not able to find anyone in the top 20 richest people in the world that made their wealth in RE. The top 20 richest people made their wealth in Retail and owning shares of a blue Chip company such as Jeff Bezo's ($112 Billion) who is the first to be worth 100 Billion. Or Bill Gates (90 Billion) (number 2 in the world) who made his fortune in technology at Microsoft, or Walmart which three of the family members are all in the top richest in the world own shares, or Mark Zuckerberg who owns shares of FB. Warren Buffet (84B)is 3rd on the list who made his wealth in buying and selling stocks.
Not until you get to #24 Lee Shau Kee (30 billion) do you find someone who made their wealth in RE and not a single one of them are from the US. There are numerous foreigners, but they all seem to be from China, Hong Kong and Thailand. The first american who is a billionaire is Donald Bren who is worth 16.3 Billion.
So according to the actual richest list, if you really want to be the wealthiest in the world, you would have to invent something or start a business (Amazon, FB, Telecom, retail), not buy real estate or trade stocks. Warren Buffet is the exception, but to note he is the 3rd richest man in the world, so there is something to be said for playing the stock market.
Yikes. Down another 546 on Thursday. Certainly no time to panic, but I'm not a big fan of being down $30,000 (paper losses) within a week. I believe in diversification, but can you imagine if your flips or buy and holds were this volatile, or lost that much money or more within a week? I could probably buy a couple duplexes around here for that dollar amount.
(Patience....patience....patience....)
Note: Zuckerberg, Gates, Steve Jobs, Jeff Bezos, Pierre Omidyar, Steve Balmer, Steve Case, etc. did not make their wealth via public stock purchases but stock they receive from being part of the enterprise.
Have a great day.
You may want to reread my post. I never said that "a signficant percentage of billionaires have created their wealth via public stock trades". Those were your words. I also never mentioned "public stock trades", those were your words. The Walmart family, 3 siblings make a significant portion of their income on their shares of their stocks. The 3 siblings own 50% of Walmart stock. Warren Buffet (84 billion) as you noted as being an investor that made his fortune off of the tradings of the stock market. let's not gloss over him as though it isn't important. He is the 3rd richest man in the world. The first RE billionaire investor is Hui Ka Yan and he's worth 30 billion and he's 24th in the world. So there is nothing to disclose of her, I'm merely stating facts. And again, it seems as though there are many directions these billionaires have taken in their lives from technology, retail, telecom, oil, stock trading that have gotten them on the Forbes list and to say that one way or the other is foolish would be pure fiction. So that's why I called you on not speaking about the ability to get wealthy via the stock market and RE. Now to bring it down to a more realistic level, you can become a deca millionaire which IMO is my goal in life, I believe that a mixture of 401k, roth IRA, RE, owning a business and savings can get you there. A new book just came out, it's called "
The Next Millionaire Next Door: Enduring Strategies for Building Wealth written by the daughter of the original "Millionaire next door" and it talks about how all of us the ability to become Millionaires and takes a survey of the population and she gets statistics on how these people became self made Millionaires. And you'll find out there are many different ways to achieve the success, not just RE.
Nothing more need be said....
Yikes. Down another 546 on Thursday. Certainly no time to panic, but I'm not a big fan of being down $30,000 (paper losses) within a week. I believe in diversification, but can you imagine if your flips or buy and holds were this volatile, or lost that much money or more within a week? I could probably buy a couple duplexes around here for that dollar amount.
(Patience....patience....patience....)
How much are you up since 2014?
2008?
1990?
Everybody needs to relax
Your Comment: "I am 34 and I have 330k in my retirement account." Correction, you USED to have $330k in your retirement account (Good job though, you are doing well and aren't part Ma & Pa investors I am talking about)
Stock Market is now down another -221 points today
Ooops, correct that: Stock Market is now down another -545 points today (That's about 1,345 points in a couple of days)
https://www.forbes.com/billionaires/list/6/#versio...
I'm not sure why your using an out of date source (Forbe's 2016), the current 2018 edition, I'm not able to find anyone in the top 20 richest people in the world that made their wealth in RE. The top 20 richest people made their wealth in Retail and owning shares of a blue Chip company such as Jeff Bezo's ($112 Billion) who is the first to be worth 100 Billion. Or Bill Gates (90 Billion) (number 2 in the world) who made his fortune in technology at Microsoft, or Walmart which three of the family members are all in the top richest in the world own shares, or Mark Zuckerberg who owns shares of FB. Warren Buffet (84B)is 3rd on the list who made his wealth in buying and selling stocks.
Not until you get to #24 Lee Shau Kee (30 billion) do you find someone who made their wealth in RE and not a single one of them are from the US. There are numerous foreigners, but they all seem to be from China, Hong Kong and Thailand. The first american who is a billionaire is Donald Bren who is worth 16.3 Billion.
So according to the actual richest list, if you really want to be the wealthiest in the world, you would have to invent something or start a business (Amazon, FB, Telecom, retail), not buy real estate or trade stocks. Warren Buffet is the exception, but to note he is the 3rd richest man in the world, so there is something to be said for playing the stock market.
>I'm not sure why your using an out of date source (Forbe's 2016)
I used the 2016 source because Forbes that year released an article where they did the math indicating what percent of the billionaires had significant RE holdings. I have not seen a similar, newer article. There were 1800 and some billionaires in 2016. There are more billionaires now than in 2016 so it would be time consuming for me to determine what percent of them had significant RE holdings.
The top of the billionaire list is full of entrepreneurs as you indicated but in 2016 just over 10% of the billionaires had significant RE holdings. I suspect the percent is about the same today but I do not desire to go through 1800+ billionaires to determine which ones have significant RE holdings.
I do not classify the billionaires that invented something or started a business with those that made their wealth by trading publicly traded companies that they were not an insider. Warren Buffet definitely qualifies as one who has made significant wealth trading public shares but Berkshire Hathaway value has also contributed significantly to his net worth. He likely has made over $1B in multiple ways. Financially a very smart man. I think the success that Warren Buffet has achieved in his trades is remarkable; he has so out performed the market.
Most investors will be good to achieve the market return. Market return for S&P life has been just under 10%. It will be real difficult, but as Buffet demonstrates not impossible, to acquire huge wealth via public trades.
It was never my intent to indicate that there were not numerous ways that the billionaires achieved their wealth. I was replying to a remark that said that not many of the most wealthy had achieved their wealth via real estate. According to Forbes in 2016, just over 10% of the billionaires had achieved significant wealth through RE. I think 10% to one method of obtaining wealth is a lot even if it is not the most common way to achieve billionaire status.
I invest in stocks and I invest in RE. My RE has far out produced my stocks and my stocks have outperformed the market. I do not view the better return via RE as comparable to the stock return because stocks are much more passive than my RE returns. To word it differently, I would never choose to invest in RE if I was only expecting the return that I could achieve through investing in the S&P; so I would never invest in RE if my expected return was only 10%. Achieving the outstanding RE returns takes time and effort. Investing is stocks takes less time and effort especially if doing something as simple as investing in the S&P.
Your Comment: "I am 34 and I have 330k in my retirement account." Correction, you USED to have $330k in your retirement account (Good job though, you are doing well and aren't part Ma & Pa investors I am talking about)
Stock Market is now down another -221 points today
Ooops, correct that: Stock Market is now down another -545 points today (That's about 1,345 points in a couple of days)
So you like real estate over stock
How unique
On the one hand this could be the start of the downturn I've been waiting for, on the other hand...I just lost a good chunk of change.
A correction would be well received by many of the folks on BP from what I gather.