The Market Thread

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Sep 6, 2012
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20K total. I like Apple too. Wife likes WalMart.
Walmart would not be a horrible play. They are starting to use the stores as distro centers like amazon. They have a truly awesome system for distro. They like to split stocks too. You dont see the traditional gains like berk or amazon , but you get more stock like a diluted dollar.
 
Mar 11, 2006
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No offense, but real estate would be the last place I’d put money in right now. No liquidity. Likely recession. Possible depression. You’re nuts.


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I would say it depends on the individual. My only real estate in my portfolio is the house I live. Almost the entirety of my savings and retirement is in mutual funds (diversified but still all in funds). I am actually actively looking to diversify and invest in real estate. I plan to leverage the current low cost of $$$ to buy real estate in the next 90 days.

After watching the market near free fall the four weeks prior (although this week has been great), I think real estate is a good addition for me.
 
Sep 6, 2012
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Edmond
I would say it depends on the individual. My only real estate in my portfolio is the house I live. Almost the entirety of my savings and retirement is in mutual funds (diversified but still all in funds). I am actually actively looking to diversify and invest in real estate. I plan to leverage the current low cost of $$$ to buy real estate in the next 90 days.

After watching the market near free fall the four weeks prior (although this week has been great), I think real estate is a good addition for me.
I agree , land they dont make it anymore. Great long term investment. You might find someone that needs liquidity now.
 

ksupoke

We don't need no, thot kuntrol
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Feb 16, 2011
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dark sarcasm in the classroom
I expect blue chip financials to fare well in the coming months. A lot of money has been pumped into the economy at basically 0%. The banks should see a nice spread there and I also expect a loosening of lending restrictions to get those funds to churn.
Last year business auto went way up, sat in on an inv call today, can’t say who, what I can say is businesses are gearing up for a +15% increase in wc, a 25% increase in epli (if they can even get it without the deductible being so high as to render it useless) a 10%+ increase in other liability coverage and this is on top of the 20%+ they saw on auto last year. Companies are struggling with how to pass this along, these rate increases are all industries and business size. There’s going to be an emotional spending spree and then it’s likely things will go dark if the economy hasn’t begun to pick up. A time to buy might be in the next 8-12 weeks a time to sell might be 4-6 weeks after.
 

jobob85

Alcoholistic Sage
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Mar 11, 2009
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Last year business auto went way up, sat in on an inv call today, can’t say who, what I can say is businesses are gearing up for a +15% increase in wc, a 25% increase in epli (if they can even get it without the deductible being so high as to render it useless) a 10%+ increase in other liability coverage and this is on top of the 20%+ they saw on auto last year. Companies are struggling with how to pass this along, these rate increases are all industries and business size. There’s going to be an emotional spending spree and then it’s likely things will go dark if the economy hasn’t begun to pick up. A time to buy might be in the next 8-12 weeks a time to sell might be 4-6 weeks after.
An economic “dead cat bounce”
 

ksupoke

We don't need no, thot kuntrol
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Feb 16, 2011
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An economic “dead cat bounce”
One more thing to keep in mind is some blue chip co’s are going to have their business models changed forever as a result of all this. Some major hotel co’s make as much if not more profit as a % on things other than rooms, restaurants will come back but I expect they’ll come back different, if a hotel is pulling in 25% of its profit from non room hospitality and services has to cut capacity by gvt regulatory agencies that’s going to be a tough pill to swallow. Airlines may have to lose seats and create more space so that’ll cut into their numbers. Apple and other tech product co’s may have to reengineer mfg lines that’ll eat into their numbers, osha is already looking at post corona and these are some of what’s being discussed.

Obviously this is not a ‘gonna’ happen scenario but I know that many SV companies are fearful of it happening and frankly, some of it is inevitable, right or wrong isn’t of consequence.
 
Sep 29, 2011
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No offense, but real estate would be the last place I’d put money in right now. No liquidity. Likely recession. Possible depression. You’re nuts.


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I would say it depends on the individual. My only real estate in my portfolio is the house I live. Almost the entirety of my savings and retirement is in mutual funds (diversified but still all in funds). I am actually actively looking to diversify and invest in real estate. I plan to leverage the current low cost of $$$ to buy real estate in the next 90 days.

After watching the market near free fall the four weeks prior (although this week has been great), I think real estate is a good addition for me.
Things you can count on.
- if we do go into a recession, guaranteed real estate will suffer. It always does.
- therein lies the opportunity, after the economic effects of the recession works its way through the real estate market. Doubt 90 days will see the real impact. More like 6 mos to a year.
- resort and vacation destination properties will suffer more than most real estate. Second homes and vacation properties are among the first divestments for those that take it on the chin during the downturn. Oil and gas wealth famously buys these properties when things are good, then sells when things go to hell. Oil and gas has gone to hell.
- if your investment horizon is less than 5 years, I wouldn’t touch it - despite the interest rates.


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jobob85

Alcoholistic Sage
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Mar 11, 2009
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One more thing to keep in mind is some blue chip co’s are going to have their business models changed forever as a result of all this. Some major hotel co’s make as much if not more profit as a % on things other than rooms, restaurants will come back but I expect they’ll come back different, if a hotel is pulling in 25% of its profit from non room hospitality and services has to cut capacity by gvt regulatory agencies that’s going to be a tough pill to swallow. Airlines may have to lose seats and create more space so that’ll cut into their numbers. Apple and other tech product co’s may have to reengineer mfg lines that’ll eat into their numbers, osha is already looking at post corona and these are some of what’s being discussed.

Obviously this is not a ‘gonna’ happen scenario but I know that many SV companies are fearful of it happening and frankly, some of it is inevitable, right or wrong isn’t of consequence.
Overreaction is what government does best. Maybe with a president who has done so much deregulation, it won’t be as bad.
 
Apr 14, 2009
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If you can. Buy Land. It will not fail you.
I personally Didn’t buy enough when I could have. I drive by all those places I could have and think to myself! “well hell!”
 
Sep 29, 2011
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If you can. Buy Land. It will not fail you.
I personally Didn’t buy enough when I could have. I drive by all those places I could have and think to myself! “well hell!”
You’d be crazy to buy land now as a targeted simple investment unless you can get something at fire sale value. Overall, land values are at all time highs - everywhere. In 6-24 months? Maybe. But only as a modest portion of your overall portfolio. Lack of liquidity and location specific (present and future) economic issues dictate only modest overall exposure, much less in concentrated areas.

I have two parcels I’d love to sell. You want to buy?

One is a 3-acre vacant lot in the mountains. The other is a high-end spec ski resort vacation home project ready to be framed.

I have a pretty clear sense about the market and the near-term future. It ain’t pretty.

Edit: I also have a Stillwater 3-bd house in Greek town area available.


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ksupoke

We don't need no, thot kuntrol
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Feb 16, 2011
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If Boeing is a value play its stock will fall to the value of its assets minus liabilities.
Let’s not abandon the titanic just yet, Boeing has over 1000 active US mdc’s with a total value of well over a $100b plus they build the Apache and chinook as well as a massive amount of other products for almost every military on the planet. The rumors of their demise have been greatly exaggerated.
 
Nov 6, 2010
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Not all real estate is created equal. Nice little rental properties that generate positive cash flow I think will be available at the right price pretty soon. Might have to put a little money into them, but then just be a mailbox farmer for a while.
 

bleedinorange

Federal Marshal
Jan 11, 2010
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In Pokey's head
Buying real estate is different from other commodities. You make money when you buy it if you're experienced. About the only way to lose is to pay too much betting on the come. I've been buying, selling and developing property for decades and own a respectable amount. I'm watching 2 pieces now and waiting to see where the effect of the current financial dilemma leads. I also watch for distressed properties where people need to sell for any of a multitude of reasons. Commercial and multi-family zoning is what I hone in on since often these were purchased with future intent and/or there is an underlying need to generate cash. @gundysburner is right about your average Joe jumping in to real estate. It ties up liquid assets and generates tax, maintenance, and insurance, responsibilities.
 
Sep 29, 2011
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Not all real estate is created equal. Nice little rental properties that generate positive cash flow I think will be available at the right price pretty soon. Might have to put a little money into them, but then just be a mailbox farmer for a while.
Just be careful. Rental values follow real estate values. I’d expect most areas will see a decrease in both. Buying high now and renting low later isn’t optimal.


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Jul 25, 2018
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Boulder, CO
Buying real estate is different from other commodities. You make money when you buy it if you're experienced. About the only way to lose is to pay too much betting on the come. I've been buying, selling and developing property for decades and own a respectable amount. I'm watching 2 pieces now and waiting to see where the effect of the current financial dilemma leads. I also watch for distressed properties where people need to sell for any of a multitude of reasons. Commercial and multi-family zoning is what I hone in on since often these were purchased with future intent and/or there is an underlying need to generate cash. @gundysburner is right about your average Joe jumping in to real estate. It ties up liquid assets and generates tax, maintenance, and insurance, responsibilities.
What are you experiences with managing residential rentals?

My parents had rentals for 30 years there in Stillwater, and we always managed them ourselves, so I got to see that from the age of 10. Fast forward a few years to when I owned a home & moved to Norman, but kept my house in Stillwater as a rental. After getting burned by 2 renters, I just decided that selling it was a lot easier than managing it from 70 miles away.

I swore I never wanted to deal with residential rentals again, but I find myself thinking about, given our rental market here. Only, I wonder if paying someone to manage it is worth it.