If the Fed is committed to propping up equity markets which they asserted in no uncertain terms when markets died in the beginnings of the realization that COVID was going to be much more substantive than SARS or H1N1, it was clear that equity markets would take the "good news" of lockdowns + continued lower interest rates as signs that equity markets were going to continue to rally. I mean basically where is there y…
> Even just running correlation analysis on these various assets over the last 20 years showed that crypto was super underpriced care to elaborate?
feel free to reach out to me, my emails are available via links on my profile.
There’s some successful projects though! There’s a good range, I like the variety, from spectacular ego-driven marriage-ending failures (…the lighthouse[1]) to some beautiful labours of love (the tree house[2]). Grand Designs is as much a monument to human achievement as it is failure! [1] https://youtube.com/watch?v=3AlsMEiAMvM [2] https://youtube.com/watch?v=CBpRLzbrCa8
It's amazing how many of the projects featured on GD end up being sold not long after completion. The most dramatic one that I noted was a very contemporary museum looking home. The owner stressed how long they had spent planning it, and how you only get once chance, and it would be his dream home. He completes the house in the Surrey woods (it was beautiful, to be sure). Sells within a year and buys property on the…
A lot of the issue is; they underestimate the build cost. So they end up with a decent chunk of equity (can be as high as 40% in some cases) but also a tonne of unservicable debt.
So you have two choices; struggle and be miserable for as long as you can before it all falls apart (but in your dream home) or sell up for financial safety and compromise on the location.
its still expensive to borrow $700,000, on top of your current expenses. that's an extra payment of $3300, whos got that laying around to wait for a house to be built
Assuming a 4% interest rate and 30 year mortgage that 700k house will also cost you $500k in interest and therefore the financing cost of that house is $1.2 million. The fun part: dropping interest to 0% raises the price of the house to $1.2 million without raising the financing cost. What dropping interest rates does is not prop up the price of housing, it's increasing the resale value of the housing you already pay…
So the winners are the people that already own and the losers are those yet to buy?
Recesssions and depressions cant happen because the US can print money? Tell that to the history books. While you are there take a look at what causes an economic turndown, it tends to come on the back of massive spending, printing money, juiced growth and wars.
> wars I'd sadly say the US has (like any empire before it) used wars and similar methods to achieve the opposite. Not always effectively but still. Check a lot of countries in the world peg to the dollar even when it doesn't seem economically sensible. Remember when Japan in the 80's was forced to do technology transfers to the US, import minimum quotas of US tech and limit it's exports whilst adjusting their moneta…
> used wars and similar methods to achieve the opposite
Totally agree - but the bust comes after the war... based on the size of spending, one could make parallels between war and covid policy. A trick old as time to stir up a war to distract from political problems. Borrow and spend is justified (unless you are a traitor and vote to kill our troops). But the flip side of that things are ugly - but it is always the next guys problem.
With so much money readily available for investment, speculation was inevitable, particularly in the Tokyo Stock Exchange and the real estate market. The Nikkei stock index hit its all-time high on December 29, 1989, when it reached an intra-day high of 38,957.44 before closing at 38,915.87. (sounds familiar perhaps?)
The 1990s in Japan was the beginning of economic turmoil and recession for that particular nation; resulting in their Lost Decade.
Recesssions and depressions cant happen because the US can print money? Tell that to the history books. While you are there take a look at what causes an economic turndown, it tends to come on the back of massive spending, printing money, juiced growth and wars.
Politically, I do not think the US will let a deflationary spiral happen as long as it can print money. Sufficient portions of the population are fully invested in the equities market, and I expect the US to pull out all the stops to prop up their prices. They might take a hit for a couple years (although I bet even that seems politically unacceptable), but on a timeframe of more than a few years, I expect the US gov…
> I expect the US government to keep inflating
I am not certain they have as much power over inflation as they think. The US have been trying to drive higher inflation since 2008. Japan have been trying to drive higher inflation since 1990's.
Europe have been trying to drive higher inflation since 2014.
Printing money, making money free, paying people to borrow, buying assets, bonds, mortgages even stocks has been attempted. We have gotten to the point of literally putting money into peoples bank account, and finally have an inflation print akin to pre 2008 in the US and Europe.
100% of the analysts that I read, and, if I'm not mistaken, close to 100% of the mill owners recognized that this was a temporary blip, and that lumber would fall back into the $500sh range (There is a natural floor - that's the price at which BC mills no longer make money and start shutting down/curtailing capacity.) None of the mills started expanding or engaging in capital programs to try and take advantage of the…
> None of the mills started expanding or engaging in capital programs to try and take advantage of the increased prices. I'm a bit doubtful about this because I know that even German mills started to produce lumber with US dimensions, causing shortages for metric lumber locally.
Definitely overseas suppliers of lumber immediately pivoted their existing capacity and started running extra shifts. I have a friend who works for a lumber wholesaler, and close to 100% of their additional sales came from lumber in Asia.
But, if there was an expectation that these price levels were going to be sustained, the mills would have started engaging in capital programs to increase their capacity - because, and this is critical - there was no supply of raw-timber issue, indeed - the price of raw timber didn't increase.
That those capital programs did not take place, is the strongest representation I can think of of Mill owners true assessment of the long term prices.
> None of the mills started expanding or engaging in capital programs to try and take advantage of the increased prices. Oh, nice call out. I wish there was a way for me to get information on stuff like this in general. That is the proxies for the future like you say. Doesn’t have to be profitable. It could be stuff everyone trading lumber futures already knows. Just for curiosity and so I can validate my news source…
This is false, the mills were expanding and the increased throughout increased supply and prices crashed (along with construction work backing out) https://www.woodworkingnetwork.com/news/canadian-news/canada... This was predictable and extremely profitable trade. I made a lot of money this year from this alone. The price increase was a result of a usual 90 day delivery for new contracted lumber and nobody anticipati…
As I read this story:
""Low mortgage rates, low volumes of homes available for resale, favorable demographics, increasing acceptance of remote working and the underlying housing construction deficit due to several years of underbuilding appear to be positively influencing the demand for new housing in North America," the company wrote in an earnings report. "Economists are forecasting U.S. housing starts for 2021 to be approximately 1.5 million units, an increase of nearly 9% over 2020. An aging housing stock and increased repair and renovation spending should also continue to drive strong lumber, plywood and OSB demand.""
The price increase was not relevant to their expansion, but long term trends in which the price increase was irrelevant.
Not what I'm seeing. Hot dog buns to cheese, everything that was $2 is $3 right now. I swear everything has whole foods price right now. I don't care what the govt. is tracking they are obviously not in my safeway.
The US Bureau of Labor Statistics actually employees quite a few people to call stores across the country and get prices. Planet money interviewed one such person not long ago. https://www.npr.org/2021/07/13/1015804773/how-do-you-measure...
The other thing I noticed is that for about a month some items had a price increase of about $1 but at the same time suddenly was "on sale" for $1 off (club card sale). So with the club card you paid the same price as last month. The sale ended two days ago and low and behold what I used to pay 3.50 is now 4.50. I have a feeling if they are calling stores, they are probably giving them the club-card price, so some of these price hikes are delayed.
If someone actually finished working on an inflation database website I would love to enter data for them. I'm seeing spikes across everything I buy in the last 2 months. I feel like the true inflation for food itself is at least 33% in the last 5 months.
Because the customers are the ones quitting, they forfeit the deposit by their contract. The developers aren't held to a timeline in the contract. They just stall forever, working on the ones willing to pay the most. If they ever ran out of better customers, they would eventually get around to the cheaper customers. They've done something unethical, but they haven't broken the contract.
Systematically getting people to hand over money when you have no intention to deliver on and have no intention to return is probably fraud.
Probably. The attorney general is working on actual fraud. This is just probably fraud. No time for that! I think there’s a healthy dose of buyer beware to be had, though that almost seems victim blaming.
I would wait. I'm an licensed inactive General Contractor. If 14 months ago, they were building them for $450,000, I'd wait. I'd shop around for another contractor too. A young guy starting out, might save you a lot. (There's no way to verify he knows what he's doing though.) If you are some what handy, it's not that difficult to owner build your own house. That is if you get the blueprints past the town's council. G…
> If you are some what handy, it's not that difficult to owner build your own house. I'm not sure what you have in mind here, but my brother did an "owner build" in the true sense of the word and sunk every nail into every piece of wood, every pipe, every wire, every window, floor, staircase, insulation, lighting, built all the cabinets, everything. That was 8 years of his life. Two of those years he literally quit h…
My 63 year old father just built his own 3rd home about 7 years ago. He had a single helper, and of course, we all (direct family) helped. Everything was done by him/us, foundation through roof with exception of the gas line hookup hehe. He started as a commercial plumber, welder, steel worker and machinist. Of course, outside of all of us helping to build his 1st, 2nd, and 3rd home, we all (whole extended family and friends) built each other's houses back in Poland in the 80s and early 90s. It's a great feeling watching your whole family working together while you lay bricks as an 8 year old. :-D So, yes, it's not that difficult to build your own house. You'll know the quirks and the issues that will come based on what happens during the build, and you'll be ready for them. However, it is work, so you should be ready to pay all of your friends and family with plenty of vodka and sausage.