Investor · Westminster, CO · Member since 2009 · 1k+ posts · 1k+ votes
15y
I do enjoy predictions and looking back at how they turned out. We are in a very interesting time right now, with high unemployment but a solid DOW/Stock Market.
Although I do not need to work, I have been testing the job market, mostly the Non-Profit sector, looking for a Finance Director Position. ( I enjoy the Non Profit world as it helps the less fortunate of our society). My last interview, the HR Director told me that they had over 400 applications for one job. The one before that, they had over 350 applications for one job. That is a lot of folks looking for work!!
So while there is no "gloom and doom" from me, there is reality. And the reality is, where I live, Gas is still $4.25 a gallon, unemployment is over 12% and foreclosures are still at record highs. I live in a strange economic area (Orange County, CA), investors are over paying for flips and banks are holding back inventory. Go figure!!
Real Estate Investor · the villages, FL · Member since 2008 · 5k+ posts · 3k+ votes
17y
OK Josh- Here is my reasoning. It was actually embarrassingly easy the way I came up with it. The great crash of 1929 took 89% of value away from top to bottom(btw, we hear it was 29 BUT the actual low wasn't reached till july of 1932). From a high of 342 down to 41! It didn't reach 342 again until july of 1954-TWENTY FIVE YEARS LATER
We're currently down 52% and dropping. We have some stops and other things to slow it down, but I think real estate will drag it down further. I'm splitting the difference between where we are now (was 50%) and the 89%. The middle would be 70% or around a market low of 3900.
When it reaches 4100, I may start putting equal amounts in each month thereafter. I'm on the record, how about you?
BiggerPockets Founder · HI · Member since 2008 · 16k+ posts · 5k+ votes
17y
I'm still processing everything, Rich. I certainly don't think we're anywhere near bottom, given what is yet to come to market (government failures around the Globe, increased losses to the residential and commercial sectors, declines in manufacturing and productivity, etc.), but in terms of a strict number pronouncement, I'm not sure I have one.
Given where we are and what's to come, I definitely think we'll approach the 5,000 mark or lower - I hope I'm wrong.
Real Estate Investor · the villages, FL · Member since 2008 · 5k+ posts · 3k+ votes
17y
Hi Joshua,
I'll stay with 3900-4000 as my low. It is just my guess. I normally am MUCH better on Real Estate predictions and that is why I put my money there..
Developer · Santa Clarita, CA · Member since 2008 · 15k+ posts · 10k+ votes
17y
As far as I am concerend, we all can guess bottom numbers in the stock market until we run out of breath. The truth is, we are all guessing and I don't like to do that. IMHO, I/WE can all make better educated guesses (or what I call, almost for sure things) by investing wisely in RE. It is much more stable and consistant than the stock market.
Also, IMO, the only way to make true money in today's stock market is to find a stock of a small company who has huge growth potential and buy when they are at their 52 week low or close to all time lows. These lows need to be there due to factors outside the company that have affected their price, and created a great buy opportunity.
I bought such a company in October of 08' and just sold for a $21k profit with a $45k investment. That is a 4 month investment which yielded a 46.6% return! This same stock is now close to my original entry price and looks like an opportunity to do it all over again.
Had the governments not intervened in the markets by bailing out AIG and the banking industry the DOW at 5700 would have been optismistic thinking. It is probable that under a free market economy the DOW would have fallen below 4000.
However, we do not live in a free market global economy and given that government-financial sector complex has virtually unlimited ability to create money and absorb debt if it is done on a global scale they can play the system any which way they choose to.
The DOW has tested 6500 recently and moved up sharply since. It is likely that the money masters will try to keep it in its current range as a baseline to hold too.
In my view the global economy can be seen as a melting lump of ice and each time it melts its peak gets smaller. There is no doubt that it can melt further and it is possible that 7500 will be seen as a goal to attain and not a baseline to maintain.
Although the government-financial sector are creating more money out of thin air by the minute and lending this to people (called injecting "liquidity into the economy") , the people will have to be really stupid to go back into the debt trap by taki g the bait of easy credit.
Even Obama realises that he has to find some other issue than the economy to maintain a positive media image, nuclear weapons. Now he does not see all the wonderful social and economic transformation of healthcare , education etc anymore as a very doable thing and this should say something. The money that could have been used for that is been sucked up in the vortex of the financial storm.
Developer · Garland, TX · Member since 2008 · 8k+ posts · 4k+ votes
15y
The Dow is up 75% in the less than 2 years from this thread's inception. I don't see that anyone in the discussion came even close to predicting this. Me included.
Has the stock market's recent performance made a difference in your RE investing?
Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
15y
To Jon's question...
We're just seeing a bottom (or maybe not) in our market. Once I start to see an uptick in prices in my area, my strategy will likely change, but for now, we're still seeing record-low REO prices and resales still need to be priced lower than at any time I've been doing this...so no changes yet, but I'm waiting...
Btw, it's fun to read the old predictions of all the doom-and-gloomers on this forum... :)
While many of them are gone now, I still remember how back in 2008-2009 (and even up until a few months ago), many here were predicting record bank closures, riots in the streets, runs on food and ammo, DOW going to 0, etc.
And they were telling those of us who didn't buy into it that WE were crazy...
I'm not saying that the underlying problems with the economy are fixed (they're not) or that things won't get worse in the future (they may), but many people just have a hard time seeing the big picture and imagining a future that is different than the present...
Multi-family Investor · NJ · Member since 2010 · 16 posts · 4 votes
15y
Hello All this is my first post, I must say I was actually panicked when I first started reading the thread until I looked at the dates..... I thought the world was coming to an end all over again LOL.
Investor · Westminster, CO · Member since 2009 · 1k+ posts · 1k+ votes
15y
I do enjoy predictions and looking back at how they turned out. We are in a very interesting time right now, with high unemployment but a solid DOW/Stock Market.
Although I do not need to work, I have been testing the job market, mostly the Non-Profit sector, looking for a Finance Director Position. ( I enjoy the Non Profit world as it helps the less fortunate of our society). My last interview, the HR Director told me that they had over 400 applications for one job. The one before that, they had over 350 applications for one job. That is a lot of folks looking for work!!
So while there is no "gloom and doom" from me, there is reality. And the reality is, where I live, Gas is still $4.25 a gallon, unemployment is over 12% and foreclosures are still at record highs. I live in a strange economic area (Orange County, CA), investors are over paying for flips and banks are holding back inventory. Go figure!!
Investor · Sarasota, FL · Member since 2008 · 17k+ posts · 17k+ votes
15y
Agreed with Mike that things are still far from "good" with the economy, though hopefully they've stabilized over the past year or two.
Personally, I think that until the underlying practices (government, banks, large corporations and individuals) change radically, things are not looking good long-term.
I saw a headline the other day that "1 million people applied for a 62,000 positions that McDonalds was hiring for"...on the bright side, there are people out there will to work for minimum wage...on the not-so-bright-side, most of them can't even get jobs doing that...
Investor · Paradise Valley, AZ · Member since 2012 · 361 posts · 214 votes
14y
Very interesting thread. I hope the doom and gloom crowd from a few years back get a good chuckle out of it. Many of my professional colleagues sold out of fear at the bottom, listening to the "experts" at Fox News and other media outlets. Bottom line, don't bet against the Fed, you will lose every time.
Investor · Round Rock, TX · Member since 2010 · 8k+ posts · 4k+ votes
14y
Many of those same "experts" are still predicting the end of the world. The doom and gloom threads have all but gone away on the forum though. If the stock market dips again they'll be back in a jiffy though.
Real Estate Investor · New York City, NY · Member since 2012 · 18 posts · 1 vote
14y
Interesting to read this thread. Starting from doom predictions to exciting celebration predictions. The truth is that the dow jones always gets back to its place.