All Forum Posts by: James Park

Today's Stock market environment is similar to that 1937. After the 90% correction of DOW Jones in 1929 (index 381) to 1932 (index 41), massive QE was poured into the system and market rallied from index of 41 in 1932 to 194 in 1937 and the rates were raised prematurely in 1937. 

Since the inception of the DOW jones, interestly the market shifts from a 18 year bull market to an 18 year bear market. 1982 - 2000 is an example of the 18 bull year market. Had you invested $250,000 and bought the S&P 500 in 1982 and closed you eyes for 18 years your S&P 500 portfolio would have been worth $3.2M by 2000. In 2000, the DOW peaked at 11,400 and eighteen years later, I would not be suprised one bit if the DOW is trading below 11,400 in 2018. We are currently in the last phase the of 18 year bear market that started in 2000.

I have believed that if oil drops to $40, something is very very wrong with the world, not just the economy. I do not believe Yellen will raise in the September, but do believe it will happen first quarter 2016. Only in 1941 is when the 10 year treasuries bottomed to 1.95. Most of never lived through an interest rising environment like we had from 1946 - 1980. The next two decades will be an interesting investing environment.

Below is a chart that shows all the MSA major cities with a population greater than 2,000,000. All the MSA cities shown in green have seen a population increase of 6% or more. All the MSA cities shown in red are experiencing slow growth with a population growth of less than 1%. Both Cleveland and Pittsburgh has had a net loss in population between 2010 - 2014.  All the yellow MSA cities have experienced modest growth between 1-5%.

MSA Green cities (Texas - 3 cities made the list, Florida 2 cities made the list)

1. Dallas, TX
2. Houston, TX
3. San Antonio, TX

4. Miami, FL

5. Orlando, FL
6. Washington-Arlington-Alexanderia, DC, VA, MD, WV
7. Atlanta, GA
8. Pheonix, AZ
9. Seattle, WA
10. Denver, CO
11. Charlotte, NC
12. Las Vegas, NV 

Below are the list of the MSA cities that have lost population from 2010 - 2014. Cleveland, OH is ranked last at 382 with the largest population outflow between this time frame. As a buy and hold investor you want put down your stakes where the population is growing, not declining.

As a buy and hold investor, it is important to research where the population is growing. Without people and demand, real estate has no value. I believe that faster than average appreciation can be predicted by researching demographics. Population growth is one criteria to consider when determining how your buy and hold investment will do in the long run.

Georgia population net inflow was 409,690 from 2010 - 2014, which makes the state rank #4 in terms of population inflow growth after Texas, California, and Florida. Atlanta (MSA) is (ranked #7 out 382) in terms of population growth. 

Population growth, job growth, demographics, and income are all very important when an investor is deciding on which market they want enter for a buy and hold strategy. Below is the data from 2010 - 2014 population growth by region, state, and at a city level. Florida is now the third largest most populous state (recently surpassing New York) in the country after California and Texas. Clearly the largest population growth is taking place in the south. Georgia has the 4 largest net inflow of 409,60 after Texas, California, and Florida.

Exactly! I can't afford a ocean front home in Socal.  Southern California lifestyle is great and all, but financial freedom, travel, emotional / physical health, and a happy wife / kids are much more important to me than owning a ocean front home in Newport beach paying $50,000/year on property and mello roos tax. LOL