2022 investing thread

[BMF]

FWIW, I do a fair share of real estate litigation. I’ve heard some rumors, that the banks are dealing with a bunch of defaulted mortgages, just like 2008.

However, the banks learned that if they start foreclosing on loans at once like they did back in ‘08, the bottom falls out and they don’t get repaid on the foreclosure sale.

So, the banks are rolling out the foreclosures gradually to keep prices high. Of course, only the execs at the banks know this for sure, but there are a lot of lawyers, and investors, who have heard this rumor.

If it’s true, prices will fall, but it won’t be nearly as rapid as before

I've got a realtor buddy in Jacksonville that is friends w/ a judge in Duval County - the judge has been sitting on around 3,000 eviction & foreclosures for months. Apparently there is a hold up on enforcement from the federal level. This is just one judge in Duval County, FL. I'm not sure if your "rumor" holds water, but I heard this story several months ago.

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On an investing note, I bought a few shares of GM today. It touched very close to a 52 week low - it was at $65+ just a few weeks ago and went under $48 today. Figured what the hell.

 

[Bernardo de la Paz]

I've got a realtor buddy in Jacksonville that is friends w/ a judge in Duval County - the judge has been sitting on around 3,000 eviction & foreclosures for months. Apparently there is a hold up on enforcement from the federal level. This is just one judge in Duval County, FL. I'm not sure if you're "rumor" holds water, but I heard this story several months ago.

There was a moratorium on foreclosures for any federally backed mortgages, but I think it expired in September.

 

[Detroitgator]

There was a moratorium on foreclosures for any federally backed mortgages, but I think it expired in September.

It did.

There was an article in our local paper today about this very subject, quoted a lawyer that sounded very similar to exactly what was said above. Said it takes 4-6 months to work through the courts and that the hot housing market was mitigating the number of foreclosures. Also said the same as above, the markets gonna come down, but slowly, not as hard and sharp as last time.

 

[BMF]

It did.

There was an article in our local paper today about this very subject, quoted a lawyer that sounded very similar to exactly what was said above. Said it takes 4-6 months to work through the courts and that the hot housing market was mitigating the number of foreclosures. Also said the same as above, the markets gonna come down, but slowly, not as hard and sharp as last time.

The 10 year is around 1.96% - once it hits 2.00 that's gonna cause the market to react (negatively). Also, the 30-year mortgage rate is ~4.2% today. That's going to price a lot people out who were shopping with 'low 3's' in mind. It's crazy. But I agree, the market is going to settle down, but will take a little time.

 

[FireFoley]

Definitely lots going on to discuss. Florida is a judicial state, so every foreclosure has to go in front of a judge, which is why it takes so long to do a foreclosure. So when the system was backed up 2008-2012, it took up to 3 years in some cases. It is why states like Nevada and AZ cleaned up their foreclosure disaster so much quicker back then b/c the avg. foreclosure could be done in 90-120 days.

@BMF mentioned 4% for a traditional 30 year mtge. clearly causes many to drop out. And as DG has been mentioning, crude oil is on the move up again. We had a 2 day reprieve with the Iran rumors , but can't see that ever coming to fruition. And when The Ruskies plow into Ukraine, all bets are off. Senile Syd said that would shut down the pipeline to Europe, , and the German chancellor kind of scoffed at that.

 

[FireFoley]

I've got a realtor buddy in Jacksonville that is friends w/ a judge in Duval County - the judge has been sitting on around 3,000 eviction & foreclosures for months. Apparently there is a hold up on enforcement from the federal level. This is just one judge in Duval County, FL. I'm not sure if your "rumor" holds water, but I heard this story several months ago.

---

On an investing note, I bought a few shares of GM today. It touched very close to a 52 week low - it was at $65+ just a few weeks ago and went under $48 today. Figured what the hell.

I had been thinking about GM as well, but have not done anything. I just can't seen to grasp how weeks and months ago how all these "ANAL-ysts" were climbing on top of each other and slobbering about how GM was so far into EV's and how they should not be underestimated and they are on par with VW, etc. Now this week they get a 2nd downgrade saying that their EV initiative will hurt their performance.

 

[Concrete Helmet]

Heard yesterday Ford closed a plant but didn't see any specifics on it. As with most things last year the EV craze was front running on news stories... Don't see them going away but I also saw where they are a tiny portion of total vehicles on the planet and a tiny percentage of new vehicles built....someone said at the rate of expected growth ICE vehicles will still be a majority on roads well into the 2030's...Same with new construction of power plants, wind and solar farms....A lot of hot air(anyone remember Solyndra under Obama?)...My prediction is Oil, Gas and resources will outperform over the next 5 years starting with Oil(last year)...

 

[Alumni Guy]

There was a moratorium on foreclosures for any federally backed mortgages, but I think it expired in September.

There was also a moratorium on evictions as well, that was on one day, then off the next. (Depending if Biden took his meds that morning or not)

It caused such jam ups, and tenants lawyers could jam up the system so much, my land lord client would find it cheaper to buy out their dead beat tenants.

“cash for keys” is the lingo. Pi$$ed me off something awful, but if it’s cheaper and quicker to buy them off, just do it.

For those of you looking for an investment property, a good tenant is worth way more than an updated kitchen. A bad tenant will play the game, live rent free, and damage your property.

Always, Always, Always, choose tenants wisely.

 

[BMF]

10 year bond shot past 2.00 (I saw it up to 2.03, not sure if it went higher than that)..... 7.5% inflation? Is that accurate?

 

[URGatorBait]

7.5% inflation? Is that accurate?

that's the word on the street.
Thanks Cornpop
https://www.cnbc.com/2022/02/10/jan...er-the-past-year-even-more-than-expected.html

 

[BMF]

that's the word on the street.
Thanks Cornpop
https://www.cnbc.com/2022/02/10/jan...er-the-past-year-even-more-than-expected.html

My point was, I think it's tamped down. It's probably closer to 9% or more, especially gas prices - which essentially trickles down to everything else.

 

[Alumni Guy]

Interesting article from the devil, but this one is objective. Yield on short term bonds exceeds long term yield. Article lays out how this is almost a sure sign of an impending recession.

https://www.cnn.com/2022/02/11/investing/premarket-stocks-trading/index.htm

 

[Concrete Helmet]

10 year bond shot past 2.00 (I saw it up to 2.03, not sure if it went higher than that)..... 7.5% inflation? Is that accurate?

No they started lying about the real numbers back in the Clinton Regime era....true inflation measured at 1980 standard would be somewhere around 15-17% from what I been told....
It's no different than the unemployment rate being 4%....They have moved the Participation rate so much beginning again in the Clinton Regime era that true unemployment rate would probably be somewhere around 12-14%. Think about it this way....How could there be 11.5 million unfilled job openings and a 4% unemployment rate at the same time while lost jobs in the "plandemic" and to technology....

It's all part of the Feds "dual mandate" fraud with their highly cooked numbers...

 

[78]

Partly right. The sampling means was expanded in 1978 to reflect changes in consumer spending habits. It hardly translates into the sensational figures you’re suggesting.

In fact, SS payments continue to recognize the old method, called CPI-W, which tracked a broad set of workers. The succeeding method, CPI-U, tracks urban households.

It’s all moot. The Fed shifted its monitoring means to the Producer Price Index a decade ago.

 

[Concrete Helmet]

So petroleum is up 66% in a years time...
Rent increased between 15-25% over the last year or so...
And food as a whole is up somewhere around 17% in the last year...(more if you check futures over that time for staples)
Wages are up almost 5% in the last year...

Now explain again to me how "true inflation" is not at least 15%.....

 

[Bernardo de la Paz]

So petroleum is up 66% in a years time...
Rent increased between 15-25% over the last year or so...
And food as a whole is up somewhere around 17% in the last year...(more if you check futures over that time for staples)
Wages are up almost 5% in the last year...

Now explain again to me how "true inflation" is not at least 15%.....

It's a question of defining "true inflation"

Take the price of housing for instance. CPI isn't looking at what it would cost for a new mortgage or rental agreement, it's looking at what people are actually paying on average. So if say 75% of people have long term rental agreements or fixed rate mortgages where the amount paid doesn't change and the other 25% have their cost go up 20%, then in aggregate the cost of housing actually paid by consumers has only gone up 5%.

Now if you're using the index to set something like social security payouts then it makes sense to look at aggregate spending. If you're trying to understand how prices are changing in the market, CPI isn't the best indicator.

 

[Concrete Helmet]

Take the price of housing for instance. CPI isn't looking at what it would cost for a new mortgage or rental agreement, it's looking at what people are actually paying on average. So if say 75% of people have long term rental agreements or fixed rate mortgages where the amount paid doesn't change and the other 25% have their cost go up 20%, then in aggregate the cost of housing actually paid by consumers has only gone up 5%.

Renters get price increases every year...nobody does more than a 1 year lease anymore....
Insurance skyrocketed also last year.
Consumer goods like cloths and shoes are way up too.
Cars both new and used at least 15-25% from what I've seen.
Utility rates are also going up...
Hell the more I put numbers together it may be more like 25% or so for part of the population(young renters who drive a long way to work and have to have professional dress apparel....they're also the ones buying more cars and moving more often.

In fact I'll bet that $15 per hour some workers got is in actually worth less than $11 per hour a mere 18 months ago. Oh and it ain't going anywhere for a while....

 

[Concrete Helmet]

Here this will help some understand....pay close attention at the .30-2.00 parts..
Staggering Inflation Sends Bond Market Tumbling - YouTube

 

[Detroitgator]

It's a question of defining "true inflation"

Take the price of housing for instance. CPI isn't looking at what it would cost for a new mortgage or rental agreement, it's looking at what people are actually paying on average. So if say 75% of people have long term rental agreements or fixed rate mortgages where the amount paid doesn't change and the other 25% have their cost go up 20%, then in aggregate the cost of housing actually paid by consumers has only gone up 5%.

Now if you're using the index to set something like social security payouts then it makes sense to look at aggregate spending. If you're trying to understand how prices are changing in the market, CPI isn't the best indicator.

I get, and appreciate, what you do with words/definititions... I agree, in most cases, it is important (legally and medically speaking, very/critically important).

However, in threads and discussions like this, I do not find it absolutely necessary... I read things, see whether or not they match with my thinking, and whether they match with my thinking or not (because the "flip side" of beliefs/thoughts/arguments are important), and go do any research of my own.

Specifically to Crete's comments, I'm not concerned with the definition of "true inflation" or whether the metric is "if you singed a rental lease, bought a gallon of gas, a pound of ground beef..." today, or if it's "on average"... I'm also not initially inclined to seriously worry about the "why" like supply chain "issues" or "covid".... I read Crete's comments on all the various classes of things he is saying are "up," and without any digging into facts, I know from my own personal experience in all of those things, that "yup, it's all been steadily up, in some cases, drastically." I don't have to have all the exact math on what creating, and pumping, $6T into the economy in less than 2 years will do... I know what putting that much water in my bath tub would do (a tub with no overflow drain, don't go technical on me! ;) ).

So while I do appreciate the input and academic arguments of this, again, I don't need any definition of time periods or metrics used to know that my gallon of gas just two weeks ago was $0.20+ less that two days ago when I drove 300 miles. Same for our prop insurance for home and especially on the beach going through the roof last year, my BCBS-FL insurance premium increasing every 3-6 months for going on 10 years now (with nothing changing during that period other than birthdays), continued shrinking of packaging size of cans of food while price remains the same or increases, the cost of meat at Sam's over the course of the last several years...

Yes, all anecdotal, but not imaginary or "inflated!" ;)

 

[Bernardo de la Paz]

I get, and appreciate, what you do with words/definititions... I agree, in most cases, it is important (legally and medically speaking, very/critically important).

However, in threads and discussions like this, I do not find it absolutely necessary... I read things, see whether or not they match with my thinking, and whether they match with my thinking or not (because the "flip side" of beliefs/thoughts/arguments are important), and go do any research of my own.

Specifically to Crete's comments, I'm not concerned with the definition of "true inflation" or whether the metric is "if you singed a rental lease, bought a gallon of gas, a pound of ground beef..." today, or if it's "on average"... I'm also not initially inclined to seriously worry about the "why" like supply chain "issues" or "covid".... I read Crete's comments on all the various classes of things he is saying are "up," and without any digging into facts, I know from my own personal experience in all of those things, that "yup, it's all been steadily up, in some cases, drastically." I don't have to have all the exact math on what creating, and pumping, $6T into the economy in less than 2 years will do... I know what putting that much water in my bath tub would do (a tub with no overflow drain, don't go technical on me! ;) ).

So while I do appreciate the input and academic arguments of this, again, I don't need any definition of time periods or metrics used to know that my gallon of gas just two weeks ago was $0.20+ less that two days ago when I drove 300 miles. Same for our prop insurance for home and especially on the beach going through the roof last year, my BCBS-FL insurance premium increasing every 3-6 months for going on 10 years now (with nothing changing during that period other than birthdays), continued shrinking of packaging size of cans of food while price remains the same or increases, the cost of meat at Sam's over the course of the last several years...

Yes, all anecdotal, but not imaginary or "inflated!" ;)

Crete asked a pretty simple question regarding how they can say inflation is only 7.5% and I answered it. It wasn't an argument and I don't disagree with the things he said.

If you are trying to get a measure of how much prices are increasing in the market and how hard it's going to be to recover from massive fiscal stimulus and QE from the Fed, then 7.5% is too low.

That being said, if you are trying to gauge the impact of price increases on the average American right now for purposes such as determining how much wealth is redistributed by the welfare state, then 7.5% might be a decent measure.