Investors have all gone

From HousingWire:

CoreLogic: Cash sales drop to 35.5% of home sales

Cash sales made up 35.5% of total home sales in December 2014, down from 38.5% in December 2013, marking the 24th consecutive month of declines, the latest report from CoreLogic (CLGX) said.

On a monthly basis, the cash sales share fell by half of a percentage point.

CoreLogic cautioned that due to seasonality in the housing market, cash sales share comparisons should be made on a year-over-year basis.

At its peak in January 2011, cash transactions made up 46.5% of total home sales. Prior to the housing crisis, the cash sales share of total home sales averaged approximately 25%. Should the cash sales share continue to fall at the same rate that it did in December 2014, the share should reach 25% in mid-2017.

Looking at cash sales share by sale type, real estate owned sales had the largest cash sales share in December 2014 at 58.4%, followed by re-sales (35.4%), short sales (32.7%) and newly constructed homes (15.6%).

While the percentage of REO sales that were cash transactions remained high, REO transactions made up only 8.8% of all sales in December and, therefore, had a small influence on the overall cash sales share.

In January 2011, when the cash sales share was at its peak, REO sales made up 23.9% of total sales.

This entry was posted in Economics, Housing Recovery, National Real Estate. Bookmark the permalink.

110 Responses to Investors have all gone

  1. grim says:

    From ZeroHedge:

    American “Nightmare” Shocker: The Real US Homeownership Rate Has Never Been Lower

    The transformation of the American Dream, most broadly manifested in popular folklore as the aspiration of the US middle-class to own a home (even if it means agreeing to a 30-year loan with one’s friendly neighborhood TBTF bank), into the American Nightmare, in which an entire generation (the Millennials) is locked out of purchashing a home due to over $1 trillion in student loans hanging over every financial decision, an abysmal jobs market (for everyone but college educated “waiters and bartenders” whose hiring is on a tear), and banks’ unwillingness to lend money to anyone that can fog a mirror, and forcing millions of Americans to rent instead of buy, has been duly documented here before.

    As we showed most recently in October, the officlally reported US homeownership rate, after peaking during the first housing/credit bubble, has been plunging in a straight line and is now the lowest since 1994..

  2. grim says:

    Funny thing about 1994, the early to mid 90s were pretty much the best time in recent history to buy a house.

  3. 1987 Condo says:

    First, let’s raise home ownership rates, then, woops, too many people own homes that shouldn’t, then, oh my, not enough people own homes….ugh

  4. Juice Box says:

    Re# 2 – late 70s before the 30 year credit expansion under Greenspan.

  5. grim says:

    Depends on the situation, it’s not only just about the lowest nominal or real price. I know we looked at this previously and the time periods that jumped out as exceptional were either immediately prior to rapidly increasing wages or significant interest rate drops. This was about capturing maximal appreciation, not necessarily bottoming of price. Both situations requiring a crystal ball, and in both situations the price/income ratios were nowhere near “bottom”.

  6. grim says:

    I recall the great debunking of the price-to-income ratio we went through, when folks argued that 2.5x was the realistic number. However, going back through 70+ years of housing and income data for the state of NJ, only during two short periods in the 1950s and 1970s did the price-to-income ratio drop as low as 2.5x.

  7. grim says:

    #4 –

    grim says:
    March 22, 2013 at 7:09 am

    When I went back and ran some models, there were some periods in NJ where you could have goosed the ratio if you purchased at just the right times, basically, if you purchased a home when the p/i ratio was lowest, and your purchase was immediately preceding a period of strong wage inflation. In the 10 years that followed the purchase, wage inflation turned the moderately unaffordable home into incredibly affordable.

    For example, if you purchased in the late 70s, by the late 80s, early 90s your original purchase price to current income (a completely different ratio), could have been as low as 1.5x. Theoretically, someone in this situation could have easily paid off the home by the mid 90s, in half of the 30 year term, with very little additional financial burden.

  8. grim says:

    Here is a bit of context on long-term home ownership rate, with the axis set at zero

    http://www.aei.org/publication/long-term-home-ownership-trends-the-us-england-and-canada/

    Paints a much less impressive picture. Other than the bubble, it’s been pretty much in the same range for the last 50 years. The recent “drop” is more of a realignment back to what was the 40 year norm.

    The rise from the 1940s through the 1960s is essentially the jump in homeownership due to suburbanization, first the post war growth, then towards the end white flight.

  9. JJ says:

    Sounds like a ton of Millennials are getting free homes. Didn’t lots of folks AKA parents buy investment properties, vacation homes etc in the RE downturn between December 2008 and December 2013.

    So who is getting the homes when parents retire or pass on the kids. For instance I bought an inexpensive two bedroom place I dont mind letting the kids move into it after school or after they are newly married to save up money. Tons of kids do this. Some parents even pay them to live there. Heck Dad has a legal two family with a third unit that is a basement apartment. Tell junior move into the basement apt and do some super work and even throw him a few bucks.

  10. grim says:

    The rise from the 1940s through the 1960s is essentially the jump in homeownership due to suburbanization, first the post war growth, then towards the end white flight.

    And after typing I realize how silly it is to try to establish any kind of housing market “norm”, when clearly, there has rarely ever been a “normal market”.

  11. grim says:

    9 – Suppose this will cause more moaning and gnashing of teeth about the inequity and unfairness of the housing market.

    In many parts of Europe, inheritance is considered a major factor in homeownership rates, especially in areas that have undergone rapid appreciation of land and home prices (the vast majority of locals would never be able to afford to live there unless they inherited a home).

    The homeownership rate in many parts of Eastern Europe are north of 80%.

  12. JJ says:

    Same in Jersey Shore, lots of beach houses are inherited or passed down to blue collar workers who could never afford a beach house

  13. Liquor Luge says:

    In the near future, it will be a privilege to have a spot near a trash can fire.

    Dystopian societal collapse, dead ahead.

  14. JJ says:

    S&P Futures are down 17 pts with Dow Futures down 158 pts

    Look out below. 25 minutes to open and things are turning red

  15. chicagofinance says:

    Did you ever consider that maybe Dystopia could be the upper end of the range?

    Liquor Luge says:
    March 10, 2015 at 9:02 am
    In the near future, it will be a privilege to have a spot near a trash can fire.

    Dystopian societal collapse, dead ahead.

  16. Libturd in Union says:

    When gas prices started dropping last year, I told Gator I thought it would settle around $2.25. So far, that call has been prescient.

    http://www.NewJerseyGasPrices.com/retail_price_chart.aspx?city1=NewJersey&city2=&city3=&crude=y&tme=6&units=us

    I’m sticking with my $60/barrel average crude call too.

  17. Libturd in Union says:

    “Dystopia could be the upper end of the range?”

    Where does fallopian fall between dystopian and utopian?

  18. Fast Eddie says:

    I looked at a house in Upper Montclair a few streets away from Applegate Farms. A nice older home, approximately 2200 sq. ft. or so. We all know the area and the property sizes. It was priced at 599K. Ok, sounds interesting. Then I saw the taxes. Anyone care to take a stab at the annual taxes? My point is, any discussion about housing in our area is irrelavant if taxes aren’t included.

    The market in our area is very ill and there are scores of people upside down. They can’t dig out and are stuck paying and then there is the kill shot called property taxes. I’m mixing my thoughts here but the bottom line is that the market is on a respirator in our area.

  19. jj says:

    18K taxes

    Fast Eddie says:

    March 10, 2015 at 9:34 am

    I looked at a house in Upper Montclair a few streets away from Applegate Farms. A nice older home, approximately 2200 sq. ft. or so. We all know the area and the property sizes. It was priced at 599K. Ok, sounds interesting. Then I saw the taxes. Anyone care to take a stab at the annual taxes? My point is, any discussion about housing in our area is irrelavant if taxes aren’t included.

    The market in our area is very ill and there are scores of people upside down. They can’t dig out and are stuck paying and then there is the kill shot called property taxes. I’m mixing my thoughts here but the bottom line is that the market is on a respirator in our area.

  20. Fast Eddie says:

    jj,

    Not even close.

  21. grim says:

    Corelogic foreclosure numbers out for January.

    Bad news, NJ still on top with a 5.2% foreclosure inventory, good news is that it is down 1.1% year over year.

    The NY Metro MSA is coming in at 4.1%, with a year over year decline of 0.9%.

    Newark MSA – 5.1%, down 1.2% YOY.

    Nassau-Suffolk, 5.3%, down 0.9% YOY.

    Also positive is the rate of decline is accelerating significantly – probably a 2 -3 year overhang at this point.

  22. grim says:

    The net number of completed foreclosures is still very low on a comparison basis…

    Completed foreclosures 12 months ending Jan 2015:
    Florida – 111,321
    Ohio – 27,891,
    Pennsylvania – 19,099

    New Jersey – 8,216

  23. Libturd in Union says:

    Eddie…Don’t forget to add the >4% tax increase coming now that the public schools in Montclair decided to switch out of the state healthcare plan for what appears to have been a teaser rate and to pay for all of the recurring charges they spent their large surplus on over the last two years. It’s for the children.

  24. Fast Eddie says:

    Lib,

    The taxes on that house are currently $23,000 per year. You do the math according to what you stated. It’s every man and woman for themselves at this point. I’m writing the final chapter in my personal search to move. It’s not going to happen unless I really step in sh1t. Otherwise, I have a roof and four walls. I’m done. For first time house buyers, you’re really f.ucked, there’s no other way to say it.

  25. grim says:

    Montclair property taxes are like the lottery, a tax on the stupid.

  26. Juice Box says:

    re # 11 – In Europe they don’t pay property tax like they do here, not even close.

  27. 30 year realtor says:

    A sick housing market is a market lacking in transactions. In order to have transactions there must be employment and available financing. Employment is steadily increasing and there is plenty of available financing.

    Not liking what is available in your price range or the amount of property taxes that go with it is not a sick housing market. That situation is as old as time.

  28. Juice Box says:

    Euro still dropping like a rock hit $1.07 this morning, 11-year-plus low.

    Book your flights it won’t get much cheaper…

  29. grim says:

    re # 11 – In Europe they don’t pay property tax like they do here, not even close.

    In America we don’t pay consumption tax like they do there, not even close.

  30. Ragnar says:

    Here’s the way to buy expensive houses and pay for expensive taxes in NJ. Get work in a field directly connected to the Obama/Bernanke/Yellen “trickle down” economics policies currently using a firehose of 7 years of zero interest rates plus central bank purchase of financial instruments. Banks, Investment banks, private equity, equities, leveraged real estate. Riding the asset bubbles flowing from the Obama/Yellen trickle down policies is a great way for left-leaning seekers of diversity to afford NJ’s premium real estate and taxes in a town like Montclair, and feel good about themselves while doing so.

  31. jcer says:

    Gary one thing jumps out is that if they can’t sell the house for 600k, then it is over assessed with 23k in property taxes. I find in the PRM and other similar Essex towns there is a ton of variance in tax to actual sales price i.e a million dollar home could have 25k taxes or 35k taxes or 45k in taxes and it all seems rather arbitrary.

  32. Juice Box says:

    re: # 29 – Grim – Apples and Oranges. Also with the widespread VAT tax evasion going on they don’t collect as nearly as much as property tax. In Ireland on a home of your value of 300k Euros is about 600 Euros a year, and they collected only 175 million Euros in property tax for the entire country. We have towns and counties in New Jersey with budgets bigger than that all funded collected from local property taxes.

  33. Ragnar says:

    In the investment world, take a payment stream of 23,000 growing at 2% annually into perpetuity, and discount it back to the present at a 4% interest (discount) rate. That stream would have a present value of $1.15mn. This is a good estimate of the present value of the tax liability the buyer would be taking on with the above house. The town has likely captured more than the full value of the home, which is why I say nobody in NJ owns their home, they’re just renting from their town.

  34. Libturd in Union says:

    ” a million dollar home could have 25k taxes or 35k taxes or 45k in taxes and it all seems rather arbitrary”

    Not arbitrary at all. Some people argue their assessments. Most do not. A good town pays attention to annual trends in home sales and makes adjustments to assessments annually to reflect this. In Montclair, they do a piss poor job with the reval they perform every ten years and those who fight theirs, nearly always win. It’s how Gator and I still barely pay more in taxes on our multi, than we did when we bought it 11 years ago. Our neighbors, on the other hand, are paying insane amounts of taxes, including what should be our fair portion. Montclair is absolutely the worst local government I have ever witnessed. It’s really a joke what goes on in that town hall.

  35. NJGator says:

    Gary – What’s the assessment in relation to what the purchase price would be? Might be possible to knock it down a bit, but it will go up every year. If you can prove the assessment is over true market, you should be able to reduce the assessment to about 85% of market value. http://www.state.nj.us/treasury/taxation/pdf/lpt/chap123/2015/ch123_essex.pdf

    BTW sh*t’s about to get real at the Montclair BOE.

    http://www.northjersey.com/news/montclair-parent-group-calls-for-the-removal-of-councilman-from-board-of-school-estimate-1.1285502

  36. NJGator says:

    Lib 34 – Some of our Montclair neighbors on our side of the street are paying 4k more per year than we are in taxes to GR…for the same sized lot and comparable homes. And they get Montclair services and schools for that.

  37. Libturd in Union says:

    I just looked up the numbers and we paid $500 more in 2008 than we did last year. Only in Montclair.

    In Glen Ridge we tried the same tactics but with much less success. We are now paying $600 less than we did when we purchased the home in 2011.

  38. JJ says:

    Funny I looked at a trade up home recently with 24k taxes and realtor called it low taxes as most similar homes have 29K.

    I told her I get a tax bill twice a year, so I have to write 12k checks twice a year on top of at least a 500K mortgage is crazy. She then threw right back at me if you cant afford the house I can show you cheaper houses. I said I can afford house but I dont want to write a check for 2k a month for rest of my life just to live in my own house. Plus taxes go up a few percent each year usually 3%. If I am starting at 24 and taxes rise 3% a year the taxes on this house will be huge by the time I retire and I will be forced to sell even if I have no mortgage. Once again she said look if you want something more affordable. It is almost the property taxes are a badge of honor.

    Used to be 25 years ago when assessors were not as quick to jack taxes in richer towns. You would find a large older home that was an estate sale that had not been reassessed for years. You snatch it up, fix it up no permits and get low taxes and just live there till you died. Let the new construction folk, folks doing blowouts and houses that had several full market resales pay bulk of taxes.

    My house sold to me December 1999 and prior owner December 1992 and owner before that bought in the late 70s and then original owner in 1955. Every owner of house bought not in a bubble. No sales of my house in the 1985 to 1990 mini bubble or the 2000-2008 price era. No permits have been filed on house for extensions since 1969. I grieve all the time my house flies under radar.

    But this trade up house the lady was selling it for around 300K more than assessed value. That 24k is a starting point, Hard to grieve a house assessed at 799k when you just paid 1.1 million for it Much easier in my case to grieve taxes on a house with no sale in last 15 years and plenty of sandy damaged comps to work with.

    On top of that the trade up house was not best house on block. there was one or two minimansions on block much bigger than the home I looked at for two million on market. Yea good luck grieving when assessor sees homes for sale withing 1,000 feet of you house for 2 million.

  39. [1]

    The transformation of the American Dream, most broadly manifested in popular folklore recent history as the aspiration of the US middle-class to own a home (even if it means agreeing to a new 30-year loan for higher principle amounts every few years until you die…)

  40. [2] Doesn’t the trough usually correlate with the best time to buy?

  41. Libturd in Union says:

    Now THIS is the shiznit.

    http://tinyurl.com/sorry-gary

    Remember, purchase price was $423K after seller concessions. Sorry Gary. :P

  42. The Great Pumpkin says:

    Amen!! He complains of unrealistic sellers, but fails to realize he is an unrealistic buyer (and they are the worst). Unrealistic seller wastes his own time or an agent stupid enough to waste time on him. An unrealistic buyer wastes everyone’s time including their own.

    30 year realtor says:
    March 10, 2015 at 10:14 am
    A sick housing market is a market lacking in transactions. In order to have transactions there must be employment and available financing. Employment is steadily increasing and there is plenty of available financing.

    Not liking what is available in your price range or the amount of property taxes that go with it is not a sick housing market. That situation is as old as time.

  43. Essex says:

    Heard that Mtn Lakes has a ‘thing’ about fences. Discourages them and insists they sit 25′ in from the perimeter of the property line. Welp?

  44. Essex says:

    41. nicely played.

  45. [6] from last year:

    The Original NJ ExPat says:
    July 10, 2014 at 12:17 pm
    I just dug out some research I did back in 2011. I have a spreadsheet with Median House Price divided by Median Household income for 105 MSAs for the years 1980 through 2006. When you view 27 years worth of data for 105 different markets certain things just jump right off the page. Here’s a couple:

    1980-2000
    1. National average ranged from 2.9 to 3.1 (times median income) every single year. Never lower, never higher
    2. Except for Honolulu, San Francisco, San Jose, San Diego, and LA a rise above 4.2 was *never* sustainable. NY/NJ/Long Island peaked at 5.0 in 1987 before steadily dropping to 3.7 in 1996.
    3. You could almost never go wrong buying in any market when the number was 2.9 to 3.1.
    4. If a market dropped to 2.8 the MSA was almost always beginning a long, if not never-ending, decline. NY/NJ/Long Island hit 3.0 in 1982 but was always 3.1 or higher in every other year.
    5. Except for Hawaii and those CA MSAs, most bubbles/run-ups started at 3.2 and popped in the 4.5-5.0 range. Bridgeport/Stamford/Norwalk was an aberration hitting 5.6 in 1987. NY/NJ hit 5.0 in 1987. Boston hit 4.5. Interestingly Honolulu and those CA markets were only around 4.0 at this time.

    I’ll post more after lunch.

  46. The Great Pumpkin says:

    So who is going to pay the cost of society? You act like you are just paying rent to the state and getting nothing out of it, totally not the case.

    Ragnar says:
    March 10, 2015 at 10:31 am
    In the investment world, take a payment stream of 23,000 growing at 2% annually into perpetuity, and discount it back to the present at a 4% interest (discount) rate. That stream would have a present value of $1.15mn. This is a good estimate of the present value of the tax liability the buyer would be taking on with the above house. The town has likely captured more than the full value of the home, which is why I say nobody in NJ owns their home, they’re just renting from their town.

  47. The Original NJ ExPat says:
    July 10, 2014 at 2:55 pm
    Here is the entire series for the New York-Northern New Jersey-Long Island, NY-NJ-PA MSA:

    1980 3.1
    1981 3.1
    1982 3.0
    1983 3.2
    1984 3.4
    1985 3.7
    1986 4.4
    1987 5.0
    1988 4.9
    1989 4.4
    1990 4.2
    1991 4.0
    1992 4.2
    1993 4.1
    1994 4.0
    1995 3.8
    1996 3.7
    1997 3.7
    1998 3.8
    1999 3.9
    2000 4.2
    2001 4.6
    2002 5.2
    2003 5.6
    2004 6.4
    2005 6.8
    2006 7.1

  48. The Great Pumpkin says:

    Funny, nj fed tax dollars go to most of these corrupt states.

    “The 10 most corrupt states were Mississippi, Louisiana, Tennessee, Illinois, Pennsylvania, Alabama, Alaska, South Dakota, Kentucky and Florida. The 10 least corrupt states were Oregon, Washington, Minnesota, Nebraska, Iowa, Vermont, Utah, New Hampshire, Colorado and Kansas.

    In addition to spending more than expected, corrupt states spent more on government activities and services that are susceptible to manipulation for private gain and less on other activities. For example:

    More corrupt states spent more money on construction, capital and highway projects. That type of spending often involves large expenditures, small numbers of contractors and clients and a lack of transparency, making it vulnerable to bribes, kickbacks and extortion.
    More corrupt states spent more on high wages, which benefit government employees. And they were more likely to engage in deficit financing, which tends to conceal the true cost of government spending from the public.
    More corrupt states spent more on law enforcement and on prisons, reflecting both the legal costs of corruption and the fact that prison construction and operation are potentially lucrative.
    More corrupt states spent less on education at all levels, public welfare, health and hospitals, areas that offer fewer opportunities for public corruption.
    “The harmful impact of corruption on education persists even after expenditures on education are divided into subcategories: elementary and secondary education and higher education,” the paper says. “These results imply that public officials’ corruption reduces states’ investment in education overall.””

    http://news.indiana.edu/releases/iu/2014/06/cost-of-corruption-paper.shtml

  49. Fast Eddie says:

    30 year,

    On your side of the ledger, I’m glad to see things are moving along. On my side, I’m offended by what’s offered. I’ve stated my case. 600K plus for someone’s stanky, dirty, worn piece of sh1t or hoping for a bailout is not going to happen.

    I don’t want main streets whizzing by, refrigerators in hallways, sinks in an alcove of a bedroom, leaking skylights, nauseating bathrooms, f.ucked up layouts, gouged walls, 40 year old carpets with p1ss stains, extension cords running against walls, 40 year old furnaces, holes in doors and the aroma of Schmidts permeating the house.

    I understand you guys need to make a living, but until the upside down pretenders get tossed or a river of select invesntory happens to appear, I’ll f.ucking die in the house I’m in before I settle for the sh1t I’m offered.

  50. jj says:

    According to the Census Bureau, the average cost of a home in 1981 was $82,500. With an interest rate of 18.45%, buying a home was expensive. A monthly payment, after putting 20% down, would have been $1,019. That’s the equivalent of $2,500 today, adjusting for inflation. And that doesn’t include property taxes, home insurance, etc.

    The average cost of a home today is $322,700. If the same 18.45% rate were applied – along with a 20% down payment – the monthly cost would be $3,986. The total payments after 30 years would be about $1.43 million, with roughly $1.18 million of that going towards interest alone.

    You could almost never go wrong buying in any market when the number was 2.9 to 3.1.
    4. If a market dropped to 2.8 the MSA was almost always beginning a long, if not never-ending, decline. NY/NJ/Long Island hit 3.0 in 1982 but was always 3.1 or higher in every other year.

  51. Fast Eddie says:

    I went to see another house a few days ago in Montvale. The price tag was upper 695K and the pictures looked promising. F.uck me for feeling optimistic one more time. I really can’t list how many “swing and a miss” problems there were with this place. I actually apologized to my spouse for wasting her time. I should have known when they didn’t have pictures of the bathrooms but I get blinded by hope. It really is like living in the Twilight Zone.

    This market is so f.ucking ill, that I augh when I go see these places. I brought my brother once to go see a house recently and his reaction was “holy sh1t” about a dozen times. I told him that someone will buy the place and the hammer price may be closer than you think. He shook his head in amazement. It was just before the bubble when he bought a 3700 sq. ft. newly built, brick CHC in a tier one town for a “6” handle. A f.ucking “6” handle!!

  52. grim says:

    51 – By 1986, you could have refinanced to 10%, by 1993 you could have refinanced to 7%. In 1981, median income was $17,743, by 1996, median household income doubled to $34,290.

    That $82,500 house could have been EASILY paid off in 15 years, with significantly less interest paid than you mention.

    In fact, you’d need to have been a complete idiot to have retained that 18.45% mortgage for 30 years, and not taken advantage of any opportunity to pay that down early.

  53. 30 year realtor says:

    #52 – Gary, I will never understand your desire to live in a town with snob appeal. Your kid doesn’t even go to public school. What is the point of paying taxes in a town with top tier schools if you don’t use them?

    Take a nice vacation with your wife. Go out for dinner. Do something with the money you are saving by staying in Clifton and enjoy yourself. Stop bitching about the housing market!

  54. [54] gary could be the King of Garfield and still say he lives in Bergen county? Great idea 30 year!

  55. jj says:

    Yea but those serial refinancings got very expensive. Also you had a lot of folks in that time frame who could not refinace, my old coop building went coop around 1988 at tail end of coop bubble. One bedrooms were 106k, the bank the sponsor used wanted 20% down and the loan was 9%.
    Lets say you bought one bedroom for 106K put down 26K and financed 80K. Pretty large downpayment. Those units fell a lot in value. They did not hit 106k again until Spring 2002 and are now worth 250K.

    You had to come to table with a huge check to refinance and most folks just defaulted and a few folks just every bonus check threw cash at it. By the time rates fell significantly and home prices recovered most folks had it paid down. Honestly many folks took a 50K 401K loan even to throw at those high interest loans. 18% will bleed you dry

    You mortgage payment was $760.
    grim says:

    March 10, 2015 at 11:50 am

    51 – By 1986, you could have refinanced to 10%, by 1993 you could have refinanced to 7%. In 1981, median income was $17,743, by 1996, median household income doubled to $34,290.

    That $82,500 house could have been EASILY paid off in 15 years, with significantly less interest paid than you mention.

    In fact, you’d need to have been a complete idiot to have retained that 18.45% mortgage for 30 years, and not taken advantage of any opportunity to pay that down early.

  56. Libturd in Union says:

    I’ll be in Garfield tonight for my son’s RDS clinic. I’ll let you know if I see anything promising.

  57. FKA 2010 Buyer says:

    I remember having a convo with my boss in 2005 about housing prices in San Diego (which is German for whale’s vag), anyway. The average income was $65k but the average house was selling for $600k. The numbers made absolutely no sense at all. Yes there was financing readily available, but the only way they could afford it was through an interest-only ARM. We thought it wasn’t sustainable but the market kept going for 2 more years. So some people who didn’t want to play that game truly were experiencing the “buy now or forever be priced out” feeling.

    I haven’t looked recently but I suspect that the homes that are closer to move in ready are selling fast. Might even be part of a bidding war. The other thing is that unlike in 2000 to 2005 range, a homeowner could pull some equity out of the house or found a way to fix it up before putting their home out to market. Today that equity has evaporated so they can’t fix it up and they throwing a rope out to anyone to take their POS off their hands.

    One thing I will say for NJ, the taxes are outrageous. Just imagine you have paid off your mortgage and retired, how are you affording a $12k (and that’s low) property tax on a fixed income? Definitely no money left over to fix up your place so you can move out the state.

    Fast Eddie, you are doing the right thing and not buying for the sake of buying. Your house will be available to you sometime. Maybe as more companies move out the state, hopefully some executives at these companies will have to sell their homes. See if you can find a realtor that works on RELOs for the major companies up here. Good luck.

  58. DuckVader says:

    I’ve been a rare poster on this blog. So I hope this comes across as a useful contribution. It looks like we are moving out of our town this year, for relocation across the Pacific–with all the pain associated with being a landlord we are selling. I’ve been doing the research and it looks like I will be staying in Manila.

    Comparing apples to mangoes, here’s what I’ve found.

    Prices are insane there. Renting a 3000sqft house an our out of Manila that’s new with minimallly useful furnishings comes out to $3000K a month; and NO useful or feasible public transportation in; have to drive.

    Property taxes are non-existent, but this is offset by the fact that a decent international school for 2 kids costs well into the $25K – $30K range total. So if you have two kids here in NJ, the 15K-18K taxes for a good school is a good discount. So housing and education, regardless of location, appears expensive. I checked Bangkok, which was comparable. Singapore and Hong Kong were more, more insane.

    The big difference is healthcare. We are going to be spending about $4K for local insurance, although I might go to one where it’s a total of $9K for full international insurance. That’s about half my total cost. And there are no city and state taxes. This is where our windfall comes in. Plus services are a lot cheaper.

    In the end, it’s healthcare, not taxes, from the point of view of a family with 2 kids, that separates the whole thing.

  59. anon (the good one) says:

    very informative. thanks for posting. it really helps to put things into perspective.
    i wonder about Manila’s quality of services, post office, fire department, etc

    DuckVader says:
    March 10, 2015 at 1:01 pm
    I’ve been a rare poster on this blog. So I hope this comes across as a useful contribution. It looks like we are moving out of our town this year, for relocation across the Pacific–with all the pain associated with being a landlord we are selling. I’ve been doing the research and it looks like I will be staying in Manila.

    Comparing apples to mangoes, here’s what I’ve found.

    Prices are insane there. Renting a 3000sqft house an our out of Manila that’s new with minimallly useful furnishings comes out to $3000K a month; and NO useful or feasible public transportation in; have to drive.

    Property taxes are non-existent, but this is offset by the fact that a decent international school for 2 kids costs well into the $25K – $30K range total. So if you have two kids here in NJ, the 15K-18K taxes for a good school is a good discount. So housing and education, regardless of location, appears expensive. I checked Bangkok, which was comparable. Singapore and Hong Kong were more, more insane.

    The big difference is healthcare. We are going to be spending about $4K for local insurance, although I might go to one where it’s a total of $9K for full international insurance. That’s about half my total cost. And there are no city and state taxes. This is where our windfall comes in. Plus services are a lot cheaper.

    In the end, it’s healthcare, not taxes, from the point of view of a family with 2 kids, that separates the whole thing.

  60. grim says:

    Alabang?

  61. grim says:

    or Makati?

  62. grim says:

    Nah Makati too close if you mean “an hour out of”

  63. Fast Eddie says:

    30 year,

    Gary, I will never understand your desire to live in a town with snob appeal.

    That’s part of the sales pitch. It’s the big hat, not cattle crowd. Who knew that a 4/2.5 random, nothing split level was the product of snob appeal! I’m not so easily fooled. Again, I can introduce you to three people who wish that could turn back the clock. I probably have six more if I think about it. The asset doesn’t forgive, it says, “f.uck you, pay me!” Their problem is not my problem because I refuse to buy for the sake of buying. And agents agree with me. Gee, how humble they’ve suddenly become! I want to buy what I want to buy, not what I’m obligated to buy. That’s their words, not mine.

  64. Fast Eddie says:

    And why are rates scraping along the bottom? If things are so great, bring them up 200 basis points. Let’s see who really has some b.alls and doesn’t need a crutch and a shoe horn to close on a deal.

  65. Anon E. Moose says:

    Luge [13];

    In the near future, it will be a privilege to have a spot near a trash can fire.

    I was at a Giants’ game last season, and as we sat in the parking lot tailgating, I looked around and saw people huddled around open fires, eating whatever they could cook on a stick, and drinking copious alcohol to stay warm; the occasional kids playing catch. It reminded my of nothing more than a movie scene depicting crushing poverty, buy each one of us had paid at least $100 per head to be there.

  66. The Great Pumpkin says:

    Great overall post, and this part of the post really hits the nail on the head. I try explaining this to people, but they never grasp it. Good safe town with a good education system and good demographics is going to have high costs no matter where in the world you live. If the place has a low cost of living, most likely education is non-existent (along with everything else), hence the low cost of living. Everything has a cost, why people think a cheaper place is going to better than a more expensive place is beyond me. If it costs more, it means people are driving up the cost in the name of competition.

    “Property taxes are non-existent, but this is offset by the fact that a decent international school for 2 kids costs well into the $25K – $30K range total. So if you have two kids here in NJ, the 15K-18K taxes for a good school is a good discount. So housing and education, regardless of location, appears expensive. I checked Bangkok, which was comparable. Singapore and Hong Kong were more, more insane.”

  67. Fast Eddie says:

    Everything has a cost…

    Remember that term for the rest of your life, sweetie.

  68. nwnj says:

    Eddie is a whiner. The market is the same for everyone and deals are getting done everyday but somehow it’s unfair to him.

    He also stood by and watched in ’11-13 when the market was bottoming. He only has himself to blame for that.

    Even now he refuses to do any work, so he wouldn’t have to deal with the FHA crowd, instead he wants a move in ready place delivered on a silver platter.

  69. Fast Eddie says:

    nwnj,

    Two time house owner over 20 years; four offers made within the time frame that you mentioned. 3 of the 4 came within a hair of my offer except my offers were too early and the sellers were “insulted.” They eventually capitulated or else I wouldn’t be having this discussion. I was too diligent in doing the “work” you claim I refused to do. Any questions?

  70. Fast Eddie says:

    …instead he wants a move in ready place delivered on a silver platter.

    You’re right. Show me the links.

  71. nwnj says:

    You also ignore that your current house price and portfolio is inflated by the same forces as the overall housing market. Mr market has been quite generous to you.

    If there is anyone who got the shaft due to that scenario it’s the first time buyer trying to build wealthy.

  72. Comrade Nom Deplume, who needs to stop screwing around and get back to work says:

    [28] juice

    “Euro still dropping like a rock hit $1.07 this morning, 11-year-plus low.

    Book your flights it won’t get much cheaper…”

    I saw that earlier today and thought exactly the same thing.

    And I briefly thought of taking my mother along. Briefly, like a nanosecond, then I bitchslapped myself and said “WTF are you thinking?”

  73. Bystander says:

    Gary,

    I was told by two realtors to step up my game and think about homes in over 700k range. Apparently 500k to 575k is for the poor and dirty. It was almost like they had something to gain if I kept reaching higher. No question about whether I could afford it. Rates rising? Surely you jest. The Fed needs to keep the lid on this sh!t pot for a helluva lot longer. I have expectations as a bagholder now. My parents bought a home near Denville for 40k in 1972 and sold it for 180k in 1987. The home I just bought for 570k will be worth 2.5 million by 2030 and 6 million by 2050. We will all be making 1 million a year in 15 years. 23K in taxes..that will be nothing. This is a normal market and past history is on my side..right?

  74. jj says:

    575k is kinda piss poor in terms of buying a house. Folks in the NJ/LI area pay around 4x income for a house. A newlywed couple lets saya 28 year old teacher marrying an average corporate job guy who is 32 is making around 200K a year. So they would be at the 800K level according to the 4x stretch.

    575K at 4x is a garbage man married to a secretary.

    Bystander says:

    March 10, 2015 at 2:29 pm

    Gary,

    I was told by two realtors to step up my game and think about homes in over 700k range. Apparently 500k to 575k is for the poor and dirty. It was almost like they had something to gain if I kept reaching higher. No question about whether I could afford it. Rates rising? Surely you jest. The Fed needs to keep the lid on this sh!t pot for a helluva lot longer. I have expectations as a bagholder now. My parents bought a home near Denville for 40k in 1972 and sold it for 180k in 1987. The home I just bought for 570k will be worth 2.5 million by 2030 and 6 million by 2050. We will all be making 1 million a year in 15 years. 23K in taxes..that will be nothing. This is a normal market and past history is on my side..right?

  75. The Great Pumpkin says:

    Yes, inflation will come hard in time. It’s only a matter of time. I bet if you told people that were buying a home in 1969 for 70,000 that their house would be over 1 million in 30 years, they wouldn’t have believed it either. Too much debt, inflation is their only answer.

    Bystander says:
    March 10, 2015 at 2:29 pm
    Gary,

    I was told by two realtors to step up my game and think about homes in over 700k range. Apparently 500k to 575k is for the poor and dirty. It was almost like they had something to gain if I kept reaching higher. No question about whether I could afford it. Rates rising? Surely you jest. The Fed needs to keep the lid on this sh!t pot for a helluva lot longer. I have expectations as a bagholder now. My parents bought a home near Denville for 40k in 1972 and sold it for 180k in 1987. The home I just bought for 570k will be worth 2.5 million by 2030 and 6 million by 2050. We will all be making 1 million a year in 15 years. 23K in taxes..that will be nothing. This is a normal market and past history is on my side..right?

  76. Bystander says:

    JJ,

    Funny you mention it. My new neighbor was a professional snow plower. He just retired. First plow was on him. What would living next to Reginald and Muffy get me? Recommendations on DJs and caterers for my kids first bday? I am Irish after all. Not exactly my way of life.

  77. Bystander says:

    Also JJ, I bought a 750k home. I just paid 570k. :-}

    Time and pressure was all it took for sellers to come to reality.

  78. That sounds like Mountain Bike prices back in the late 90’s, with the decimal places moved over a few spots. Back in ’94-’98 when MTBs with suspension were first becoming mainstream, I was an avid rider (Many eastern states plus Moab, Porcupine Rim, etc.) and friends used to tell me they had $500 to spend and they wanted to buy a really “good” mountain bike. I used to tell them the same thing every time. Spend under $300 or over $800, preferably spend under $200 for a decent unsuspended bike to find out if you really like the sport and will continue with it and then spend over $800 to get a really good entry level front suspension rig that you can really take places. Spending $500 only wastes a lot of money for sport you might not like or leaves you wanting for the real bikes that started at only $300 more than what you though should be the price for a good bike.

    I was told by two realtors to step up my game and think about homes in over 700k range. Apparently 500k to 575k is for the poor and dirty.

  79. nwnj says:

    Of course Eddies house has appreciated 225% in 20 years and he wants top dollar for it but paying market value for a pristine move-in ready house in a top neighborhood is a total travesty.

  80. Bystander says:

    And punkin, if you told them that the Federal Reserve printed 4 trillion just to keep the game going, I bet they would run into their concrete bunker, hands covering their head.

  81. Fast Eddie says:

    …but paying market value for a pristine move-in ready house in a top neighborhood is a total travesty.

    Where’s the link? Show me.

  82. Fast Eddie says:

    nwnj,

    I technically sold my house a little over two years ago with a contingency that I find another house first (I can’t believe I’m explaining this yet again). After 8 months and 4 offers submitted, I pulled the plug as I explained the reason why earlier. Remember? Or do you suffer from selective memory? I could have gotten more money for my house but I was actually trying to give the younger buyers a little bit of a break. Yeah, you read it right. My spouse and I actually agreed to it. Can you f.ucking imagine that? So, every accusation you’ve made today about me has been wrong. Any questions?

  83. clotluva says:

    jj.

    If you are advocating spending 4x annual income, I’m really surprised to learn you are looking in the <$1MM range along with the newlywed firefighters and teachers.

    They must not compensate BSD's on Wall Street like they used to. You sure you're a playa and not a studio G?

  84. DuckVader says:

    Grim,

    Ayala Alabang–I’m surprised you’re familiar with the place! RAV 4 is USD 35K. Having a driver costs $350 a month. And a maid runs to about $150 a month each (they say get at least two–one to cook, the other to clean). A haircut in a nice place in the mall is $7 with tip already. And best of all — we tried a roundtrip ticket to Bangkok on a local discount carrier booked 3 weeks in advance and it was $125 bucks a person; that’s the price of car rental from Bergen to JFK. It’s the school that’s driving me nuts.

  85. clotluva says:

    Low rates or not, paying 7x income for a 30 year note (ala 2006, which is where all the house pumpers want the market to go) is like standing on a stool with a noose around your neck. Particularly if you are relying on a single income.

    And one can’t exactly hope to refinance one’s monthly payment down at some later date when there is nowhere left for rates to go but up.

  86. Essex says:

    I hear you on the $$$ – it’s all debt to income anyhow. Rather put it into a nice house. But you really buy the town.

  87. Anon E. Moose says:

    CL [87];

    Don’t forget the rate risk you’re taking when the time comes to sell the place.

    When people told me to buy during the height of the bubble, saying “You’re paying your landlord’s mortgage!” I told them that may be true, but if I bought today I can’t get “his” mortgage; the mortgage I get would have to be three times what I was paying in rent. Similarly, tomorrow’s buyer won’t be able to get ‘your’ rate to leverage their dollars to buy your house.

    Time-shift out 7-10 years down the road — when the Realtors tell us most people sell their house anyway. People are payment buyers, pure and simple. Seller holding a mortgage in the 3% range (say $1,700/mo. P&I to service $400k at 3%), if they find themselves selling into a 6% rate environment, their buyer is paying $2400/mo. just to buy them out at par. To get the same payment at 6%, their offer price has to be 30% less than the price you bought at.

    And Pumpkin, inflation is irrelevant, or at least is doesn’t salvage the deal from the seller’s perspective. If the dollar has inflated to the point where $2400 in 10 years == $1700 today, then getting bought out at par means I lost money on the price of the house.

    I don’t believe that sellers will take it all on the chin; but 6% rates will constrict demand, which means that transactions will be slow and the market sickly, kind of like what we’ve got today with 4% rates, no?

  88. JJ says:

    It is the property taxes not the price of the home. Which is why lots of real estate investors love Brooklyn, Queens and Manhattan, super low property taxes and high rents.

    Jersey and Long Island taxes and lower rents do not make up for cheaper houses.

    A real playa like Flava Flav still lives in the Projects.

    clotluva says:
    March 10, 2015 at 3:46 pm
    jj.

    If you are advocating spending 4x annual income, I’m really surprised to learn you are looking in the <$1MM range along with the newlywed firefighters and teachers.

    They must not compensate BSD's on Wall Street like they used to. You sure you're a playa and not a studio G?

  89. Fast Eddie says:

    …which means that transactions will be slow and the market sickly, kind of like what we’ve got today with 4% rates, no?

    Which the FED blink and all the bag holders go into convulsion.

  90. clotluva says:

    89. Moose.

    Absolutely agree. But heaven forbid you suggest that prices may come down in a higher rate environment. No one invested in the industry wants to hear that.

    That said, given all the gimmicks to date, I would not be surprised to see some form of stealthy (or not so stealthy) negative interest rate before we see 6%.

  91. nwnj says:

    #83

    That sounds like a colossal waste of time, I guess that explains some things. And I do applaud the move but I don’t think it will succeed if you are expecting someone else who is selling to share the same philosophy.

  92. clotluva says:

    JJ,

    I thought you were talking primary residences.

    For NYC, don’t forget to add the 3-4% income tax, plus an $18k/year vig for those making over $500K, to the “low” property taxes.

    http://www.tax.ny.gov/pdf/current_forms/it/nyc_tax_rate_schedule.pdf

    Property taxes on no frills 2BR condos in Manhattan run around $12K/year.

  93. The Great Pumpkin says:

    By the time 6% rates get here, wage inflation will well be on its way. You can’t have 6% rates return without wage inflation. Not happening. If you don’t believe wage inflation will come, then don’t think for a second that rates will rise within a stagflationary/deflationary environment. They will only rise with wage inflation. That’s why the fed will raise the rates, to cool off the inflation.

    Also, under current conditions, when rates rise, house prices will increase for the simple fact that a rise in rates will coincide with wage inflation.

    “Time-shift out 7-10 years down the road — when the Realtors tell us most people sell their house anyway. People are payment buyers, pure and simple. Seller holding a mortgage in the 3% range (say $1,700/mo. P&I to service $400k at 3%), if they find themselves selling into a 6% rate environment, their buyer is paying $2400/mo. just to buy them out at par. To get the same payment at 6%, their offer price has to be 30% less than the price you bought at.”

  94. Ragnar says:

    Duck,
    I sympathize, but if you’re going to be an expat, you have to either get a full expat package with the company paying for housing, insurance, education, and transportation. Or you can live like a local. Or make so much money that you can afford to create an American bubble in a foreign country.

    What I’ve also noticed from direct experience is that allegedly prestigious international schools overseas often suck. Mostly because they’re too small to track the kids according to their abilities, and thus teach to the skills of the median kid in a class, whose English isn’t that great. This doesn’t bother the kids of the Harvard-educated country presidents, because they’ll get in via their parents and exotic resume, even if they didn’t learn that much. But a bunch of the kids just get a high-priced mediocre education, mostly served up by expat US public school teachers.

  95. ccb223 says:

    Clotluva – explain this $18K vig to me please. That tax rate schedule is an extra NYC city tax if you make over $500K? Seems totally ridiculous. Although couldn’t you just get around it by filing separately from your wife if apart you are below $500K but together you are over that threshold?

    Fast Eddie – I feel bad for the guy who agreed to buy your house contingent on you finding another one. Poor guy, he’d still be waiting to move in after all these years. Hell, he is more likely to move into a nursing home first.

  96. Fast Eddie says:

    grim,

    Organize a get-together. I want to see who shows up.

  97. NJT says:

    Two buddies (one a refugee tenant of mine from South Africa – not a Boer – that turned into a landlord then property flipper and made a small fortune here in NJ…) relocated to Costa Rica. One has kids, works for a giant corp. and lives in an American enclave the other (with his wife), on a small plantation type property out in the country.

    Both are doing well (since 2008).

    I think about it sometimes…when driving to the office in snowstorms with the temp. below zero because the boss won’t.

    Nice place but there are negatives, and BIG ones… as is usual for the 3rd world.

    BTW – Education in the American (and German) enclaves is EXCELLENT. I’d rate it
    better than most in NJ.

  98. DuckVader says:

    Ragnar,

    Thanks for the advice. The pay is good enough that I can create a moderately sized bubble; there will still be some left over even if we go IS. I was hoping to save more, but the IS is really expensive — the British one charges even more. I could go Singapore IS in Manila, and get the the kids to learn Mandarin as well.

    It’s partially a gamble on my part because if the business grows in that part of the world then I could be contributing a good enough part of my unit’s revenue (and with that comes the bargaining power, I hope). Of course, the annoying thing is that the only way to salve our conscience in moving our kids there is to get them the best education we can afford — sound familiar?

    But as I mentioned at the end of the day, when I add in the housing and education costs of a suburban house + education, it’s almost a wash with living in a moderately sized house in northern NJ in a “good” district. I saw the same whether in Jakarta or Bangkok; HK and Singapore were simply out of our league. You just have to grin and bear with the inefficiencies of Manila, but the price of services are unbelievable. And we can go to any beach any day of the year as long as there’s no typhoon.

  99. NJT says:

    “as long as there’s no typhoon”. Or Volcano erupting (happens in Costa Rica, too).

  100. Juice Box says:

    Re: #73 – Nom after my dad passed I took my mom to Paris. If you take your mom there you will find no better shoe shopping places on the planet. Enjoy…

  101. The Great Pumpkin says:

    Faber has been long term bearish about the American economy for a number of years, and continues to be so. He concluded his June 2008 newsletter with the following mock quote:

    “The federal government is sending each of us a $600 rebate. If we spend that money at Wal-Mart, the money goes to China. If we spend it on gasoline it goes to the Arabs. If we buy a computer it will go to India. If we purchase fruit and vegetables it will go to Mexico, Honduras and Guatemala. If we purchase a good car it will go to Germany. If we purchase useless crap it will go to Taiwan and none of it will help the American economy. The only way to keep that money here at home is to spend it on prostitutes and beer, since these are the only products still produced in US. I’ve been doing my part.”

    http://en.m.wikipedia.org/wiki/Marc_Faber

  102. The Great Pumpkin says:

    Couldn’t agree more. No chance in hell for hyperinflation in the U.S. Also, totally agree that the fed did a superb job of dealing with this mess. I know you guys hate the fed, but they did a damn good job. There is no doubt in my mind that inflation will come, it’s just a matter of time.

    “The Potential for Hyperinflation in the U.S. Today

    Could the U.S. experience hyperinflation? If you look at the amount of the Feds monetary expansion since 2008, then you would likely conclude yes. For example, when the financial crisis began, the Fed’s balance sheet was around $800 billion. Today, it is over $4 trillion. That’s a tremendous increase. However, it’s important to note that the majority of this new money is sitting at the Federal Reserve and has not actually entered the economy. If this were not the case, if all this capital were allowed to enter the economy, inflation would be very high. Perhaps not hyperinflation, but I believe it would be much higher than it was during the late 1970s.

    Why would the Fed flood the market with so much money if it wasn’t intended to enter the economy? Because during the 2008 crisis, not counting the banks that did go out of business, a large number of other banks nearly collapsed. The actions of the Fed were nothing short of brilliant. They created a glut of new money through T.A.R.P., QEII, Operation Twist and QEIII. Then they offered to pay interest to banks on their reserves, which from a financial standpoint made it profitable to banks to leave large amounts on reserve. Hence, with the majority of this new money in reserve, bank balance sheets have been greatly strengthened. It’s important to note that the financial sector must be strong if the economy is to thrive. The Feds challenge will come when it’s time to unwind it all.

    With over $4.2 trillion on the Fed’s balance sheet ($3.8 trillion more than at the beginning of the crisis), when demand finally increases and lenders need more capital to lend, or when the Fed decides not to pay interest on bank reserves, the Fed will have to reverse course and, instead of buying bonds (which removes cash from its balance sheet and increases the money supply), it will be selling bonds (removing cash from the economy, reducing the money supply). This is where things could get dicey. This is also why the Fed would like to end QEIII as soon as possible. Because the longer it continues, the more money there will be to remove and this could cause a severe dislocation in the financial markets. In other words, when the Fed ceases QEIII, the stock market could decline along with bond prices.

    Conclusion

    Is Marc Faber correct in his prediction? Will the U.S. experience hyperinflation within the next 10 years? It all depends on consumer demand and the leadership of the new Fed Chair, Janet Yellen. It will also depend on economic growth in the rest of the world. The road out of the 2008 crisis has been masterfully maneuvered thus far. Will the next leg of the monetary journey be as smooth? I believe the Fed has done an outstanding job, all things considered. However, with a new chairperson, will the Fed continue to guide the economy with the same precision? My guess is that it will. After all, there are a lot of very bright individuals making decisions, and that gives me confidence. We’ll see if Mr. Faber is right. For the sake of all of us, I hope he’s wrong.”

    http://www.forbes.com/sites/mikepatton/2014/04/28/is-u-s-hyperinflation-imminent/

  103. Juice Box says:

    Re: 104 – “no chance for hyperinflation”

    Have you heard of China? How about SWIFT?

  104. chicagofinance says:

    Revis Island relocates……

  105. Comrade Nom Deplume, not as pretty as Grim says:

    [106] chifi

    Saw that.. Sad as I am to see him go, I am mindful of the fact that this is usually a good call on the part of NE.

    Besides, now the Jets players get to see what a Super a Bowl ring looks like.

  106. The Great Pumpkin says:

    For anyone that thinks the monetary system should be backed by gold, here is a bunch of evidence for why you should throw that idea in the garbage.

    http://www.pragcap.com/debunking-the-myth-that-a-gold-based-monetary-system-coincides-with-higher-growth

  107. Comrade Nom Deplume, not as pretty as Grim says:

    [102] juice

    8 years ago, I let my wife talk me into taking her mother along on a trip to Paris and Normandy. Biggest effing mistake of my life.

  108. The Great Pumpkin says:

    Yes, under our current system it is impossible to have hyperinflation. Unless they change the economic system, we have no chance for hyperinflation. Basically, most of the money out there is in the form of loans or credit. Only a small percentage is fiat based. They would need to add something like a hundred trillion or more in order for hyper inflation to occur and that’s just not going to happen under the system.

    Juice Box says:
    March 10, 2015 at 8:41 pm
    Re: 104 – “no chance for hyperinflation”

    Have you heard of China? How about SWIFT?

Comments are closed.