Wednesday, September 18, 2013

Every day is like a high stakes game of poker whether you want to play or not.

If I'm a flipper right now - I'm living on my stomach lining. It doesn't matter how many houses you sell to dark pools if people can't afford them. It takes time to turn a house back into something people want to buy. Three months is a reasonable time. If you gut the place, I'd expect six months.

I can't remember a single time where mortgage rates have climbed almost a full point in the time it takes to flip a house. And there is no way to predict what they will do. The forces of inflation and deflation are duking it out every single day. Right now things look inflationary, but lurking around every corner is severe deflationary pressure.

I should have stayed with my first thought about tapering. I was the only one saying they weren't going to taper. We all agree socialism is the goal. Right? So why would they ever taper? Still, I also don't see how prices can continue this way. No matter how low mortgage rates are. Which is a deflationary statement.

Last night I was thinking that the retail sector is surprisingly anemic considering housing prices are really not that far from the previous top. I say this because negatively equity does some crazy things to you psychologically. If you don't think you will not get a return on investment - why would you ever do anything to improve it? Even for someone who lives for that kind of shit, I had to fight this urge over and over. Sadly you have to squash that feeling. Some day the world will be better, and if you can't sell an asset - it's almost as good as not having it.

It's quite obvious the liquidity trap is still deeply entrenched. This is a huge deflationary pressure. I'm only doing a project because if I don't do it now, I have to wait till the summer. It's a timing thing. Not an "I feel all better thing". Also read: You can keep stealing from the bank as long as the bank doesn't notice.

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