Topic: Gold collapsing. Bitcoin UP. - page 1002. (Read 2032266 times)

Exactly this. What always strikes me about the buy vs. rent discussion is those who say "always buy" are not taking into consideration the reasons housing has done so well.

For the lower and middle classes housing has served 2 roles, it has acted as the ONLY inflation protected asset to counter the FED's printing press and has acted as the ONLY method to leverage and benefit from the FED's financialization wave to expand credit everywhere (which enabled housing to grow faster than inflation). Additionally, for the government housing has acted as a forced savings plan.

Whether or not housing (in general) will continue to be a smart investment, largely depends on your views regarding the government's ability to continue these trends. Personally I think the expansion of credit cycle is largely tapped out, and the FED will try to only use the printing press to counter the loss of credit growth. In this scenario renting and saving the extra monthly savings intelligently can do very well compared to leveraging 5x your net worth in a single asset class.


Great for him, I hope he did it by understanding the new environment he was in and leveraging that to the hilt.

My worry is so many in the following generations assume these trends will go on forever and blindly leverage to the hilt in housing. Most of my peers have done so, they are so "house poor" with CA prices that they have zero ability to create savings outside of housing. This is bad IMHO.

Lastly, if you believe Bitcoin will succeed as an escape from centralized money, bringing to a dead stop central bank expansion of the money supply (no more printing and no more bailouts of leveraged banks), then housing in terms of price:income will NOT do well compared to today's valuations.

crap!

housing is just like any other asset you may choose to invest in.  you gotta be smart about it.

if you are, you'll reap the benefits.

agreed,
i could try to argue that as long as the house appreciates faster than the interest rate it make sense to borrow like mad and buy a massive house, but i don't actually believe that...

There's possibly even more truth to this than is acknowledged.

The law governing land/property ownership is an interesting topic. The government typically owns the registry, and people think of that as the list of plots, but only as a practical reality. You can own the title to any plot and all structures built on it, but this only gives you the right to live there above that of the rest of the serfs.

People say "well, in practice you own it, title and registry are just legal technicalities". This is true given the present title legislation and world-economic circumstances, but what happens when sovereign bond armageddon strikes? According to sovereign bond armageddon cheerleaders, the central banks and governments become bankrupt, as the debtor can't pay and the creditor now has no assets. Rainbows and unicorns ensue, everyone is free of debt and government and central banks go away muttering curses. I wonder if the central banks would ask for the land registry instead? If the debts also cover assets up to, say, the legislature, the police/army/secret service infrastructure, trunk communications backbone, roads/transport infrastructure, energy production facilities...

Even the most pessimistic dytopia merchants don't even paint a picture as bleak as this, but I can't see the establishment all giving it up to live as benign retirees. It's tempting to suggest that this past century has gradually evolved into a massive leveraged buyout of entire land masses. Lets hope all those birth certificates in the records offices can't be reinterpreted as government assets (or contracts of ownership). Think happy thoughts everybody!  

There is nothing wrong with owning a house.  Just buy an inexpensive one with low upkeep, and as work hard and as fast as possible to own it outright.  Just like 6-7 year financial loans for cars are pure evil, so are 30-year mortgages.  It doesn't matter what great interest rate you get from the bank, they and the rest of life OWNS you if you are locked into high debt.  The first 10-15 yrs of a mortgage is pretty much all interest paid back to the bank first, and nowadays most people don't stay in their first or even second home nearly that long.  Not to mention all the "upgrades" and sunk/hidden costs that they never recoupe.

I would take a condo that I owned outright, over a financed house that was owning ME any day.

Investment in housing is very complex. You have to consider

Inflation
The housing price development
What living standard you want to have
Your life situation, including risk of change
Your job location, including risk of change
maintenance, sudden reparations
ownership taxes
water, energy, waste removal prices
Reserve cash
Lease out a part, taxes connected to lease.
capital gains tax, tax relief, often depending on length of ownership, dependent on buying a new house
How much do you want to save
Flexibility
Refinancing, taking out the gains in the form of a new loan

I am sure there are more.

Normal situation is to save in housing, mostly as a defense against inflation.

With bitcoin, you have defense against inflation, plus low cost of ownership, plus liquidity, and more.

I've been traveling for over four years. I was pretty sure I'd get bored with it after six weeks but I guess that didn't quite pan out. I'm terrified of the day when I have to stop. It will be quite an adjustment.

I didn't imply that you did. But if you have a roof over your head and are rent free then you're onto a good thing, good luck to you!

Don't have one.

I'm sure landlords think your theory is absolutely great!

I agree with this theory, and I've been pushing it increasingly further over time to see how far I can go.

Me.

Renting means not having to put a huge portion of your net worth (or in most peoples cases, more than their net worth, so with leverage) in the stupid asset class real estate while at the same time being not diversified at all. Further all houses here are seriously overvalued (100-200%) because of government intervention (mortgage interest is deductible from income taxes) which I predict is going to be reduced until it can be abolished bringing the housing prices back to what should be normal. Finally, when you own a house you have zero flexibility. I really don't want to own a house thank you very much.

It is a forced savings plan - but when you know this, and refinance your house every year to take out that saving to use on cars and vacations - you do not have a house in the end.

Monero will possibly be the thing that ushers in the Mark of the Beast, because it truly is an unconfiscable asset. That people opt out from the ultimate total enslavement plan of the world government, and happily use Moneros, pisses the controllers so much in the eye, that they actually manage to enact death penalty for all who would like to live their lives happily without their lame mark of the beast.

Read the rest of the story in Revelation: beautiful heroines, last-minute saves and surprising plot twists...

I think there is a clause where under the military act they can always just "take your land" for the "good of the country" at no cost. So yea you never really own it, they just make you feel like you do and every pea brain out there who doesnt think critically does think they really own it so society as a whole understands it as the be all end all asset to own, especially as shit hits the fan because people need to eat and need shelter. On the other end when shit really does hit the fan people wont care about eating the same and sheltering themselves in the same way.

You forgot property taxes.

One never truly owns the land or the dwelling. I  paid off my home years ago yet I still fork over huge amounts.

Government has an interest in people owning property.  It fosters docility, because they are bound to geography they can always take it and you can't take it with you if you leave.  It is the safest asset for them for you to invest in.

The market is screwed up look at what is happening in the UK, home owners are getting tax payer subsidized grants from government - if you don't own property you are subsidizing property owners as a tax payer.

It is happening here in Canada too, it's just hidden in inflation and demand is somewhat controlled by the fact there are few developed cities.

It's crazy rents here are as expensive as mortgages and subject to inflation - to which mortgage happen to be inflation proof.

In effect the housing market is eating monetary inflation and the productive people of the world are servicing that  inflated debt money.

But if you could find rent cheaper than a mortgage and you invested the difference in Bitcoin I'd say. RENT and buy Bitcoin.

But then I am an Outlier, and to date most think I'm a nut job and just stupid not getting in on the property boom.

gold futures slowly descending tonite.