Posted on July 27, 2008 @ 8:35 pm - Written by BawldGuy
In my experience, the beginning of the end of relatively bad economic down times, comes when the handful of folks with real power decide it’s time. You think dancers are choreographed? When the real power makes their moves, Fred Astaire is impressed.
The last several weeks, especially during this month, the small group of clean-up hitters have all grabbed their bats. (He said, making use of world class skill at mixed metaphors.) Bernanke bails out one of the biggest Wall Streets houses. Before that he was indirectly increasing liquidity of not only domestic banks but hose across the pond. He then allows banks not on the cool list access to ‘the window’ at the Fed. His latest? Allowing Fannie and Freddie to also belly up to the Fed for dead presidents as they see fit.
Those are serious moves by anyone’s definition.
Next comes the White House. The president blithely strolls up to the podium and announces how he’d be pleased as punch if we turned drilling for oil into a national sport. Geez, I dunno. Ya think that had anything to do with the almost immediate downward pressure on oil prices?
Wanting his own face time was Treasury Secretary Paulson. Henry throws the gauntlet down to the rest of the world — seems the dollar should be strong. Now there’s an idea to ponder. Why didn’t we think of that? A strong dollar tends to solve a plethora of economic ills. This isn’t news, of course, but true nonetheless.
To review, here’s what’s happened, and just as importantly, not happened in the most recent past.
Bear Stearns failure avoided. Liquidity for banking systems not allowed to become huge factor. Secondary market for real estate credit/financing aided. Oil problem finally shown in public to be what it’s been all along — supply and demand. Go figure. The dollar begins to get real support, at least on the talkin’ side. And for bonus points boys and girls, durable goods swats Chicken Little in the butt. The market had already discounted widely accepted expectations of a .2% dip. Instead, they came in at a solid, and surprising full 2% increase.
And no, I’m not gonna argue the finer points with all the MBA’s who think it’s their mission in life to explain how everyone else in the room just doesn’t get it. The fact is, the big boys are now in the first stages of flexing their muscles, and I’m not gonna quibble — except to say it’s about time, guys.
OK, enough of that stuff on a Sunday. let’s listen to some tuneage. Between Bernanke, Bush, and Paulson, seems they’ve choreographed their dance well.
And now, apropos of absolutely nothing, except maybe as homage to The Boss, our Sunday night video. See ya tomorrow.
Posted on June 27, 2008 @ 11:51 am - Written by BawldGuy
David Shafer and I agree on most things related to the attainment of wealth and a magnificently abundant retirement. Here’s a bonus for my readers today. Wanna know the slam dunk difference between those living a hand to mouth retirement and those for whom the hardest decision is where to travel to next?
BawldGuy Axiom: No wildly successful action ever came from anything but a thought. Thought — thinking, always comes first. Poor thinking = equals poor doing.
A superb retirement comes from Purposeful Planning, doing things on purpose. It doesn’t come from a mental attitude equivalent to rollin’ dice on the Craps table at the casino.
2. You’ll see yourself in all your security driven splendor, then race down the hallway to the door marked ‘DENIAL’.
3. You’ll see yourself, recognize the need for a sea change in your thinking, and begin your new and abundant life.
David and I want everyone to enter retirement with a sense of excited anticipation. If the thought of your retirement makes your palms sweaty, and sleep hard to come by, click the link and read the post. If it changes your thinking it’ll change your life.
Without the right mindset, your retirement might very well end up as a life sentence. When you finish reading David’s stellar post, come back here and take a short listen to the Grandpa Economics podcast. You won’t be sorry.
If you now think you’d like some help with your retirement, Contact Me. I love this stuff. It’s the only reason I keep doin’ it. Let’s figure a Plan just for you.
Posted on June 26, 2008 @ 1:05 am - Written by BawldGuy
We’ve found the right property(s) for you. You’ve successfully entered into escrow, and have navigated all the hurdles and potholes encountered on the way. It’s time to transfer ownership to you. Let’s look at what happens now.
Note: For those who haven’t read the series from the start, and would like to do so, here on some links for you. Here’s Part I, Part II, and Part III
I’m gonna simplify this as much as I can. It’s not my job to make things as difficult and/or complex as possible, right? Right.
How do we know when we’ve arrived at our off ramp? There are as many answers as there are brokers and investors. For me it’s when lender says to get ready for loan docs. Don’t get me wrong, Murphy still has arrows left in his quiver. They’re just harder for him to reach now. At least that’s my story, and I’m stickin’ to it.
BawldGuy Axiom: The escrow ain’t closed ’till someone tells you it’s closed and even then not ’till you’ve confirmed with the title company. You can be fairly sure when you’ve received the payment info from the lender. Probably. Read the rest of this entry »
Posted on June 17, 2008 @ 10:06 pm - Written by BawldGuy
Let’s take a peek at what a shiny new real estate investor faces when entering this market. We’ll use a composite Brown and Brown client made up of several clients who’ve come on board this year. They’re early 40’s with two kids. (She’s 39, sorry.) They make $150,000/year between them. They own a home with a loan at around 70% loan to value. The investment capital available to them is $125,000 not including their cash reserves. They credit is very good, with both scores in the mid-700’s.
First we need to hear them say they wanna be our clients. We don’t make a big deal about it, we just need to hear the words. Once spoken we shift into gear and our V-12 power plant begins its throaty hum. Ever heard a V-12 idling? It’s been described by some as a small airplane. Very cool.
Here’s the chronology
1. A frank discussion is had between the us and the client. How old are they? Salary? Savings? Other assets? Credit? Retirement goals? The list goes on for awhile. The agenda is to establish a Purposeful Plan based upon the answers to these questions. This Plan is the foundation for our first moves on our client’s behalf. It’s importance can’t be under valued. Read the rest of this entry »
Posted on June 6, 2008 @ 12:45 am - Written by BawldGuy
I hate infomercials hard. Then there are the cattle call seminars promising their spellbound audience great riches and early retirement through investing in real estate for cash flow. It’s not that the idea isn’t way cool, it is. But seriously people, the stuff they’re puttin’ out will make your lawn grow faster, but not your capital. And cash flow? Give me a break.
It’s the old ‘on paper’ vs real life thing. On paper, a house bought at the Dollar Store with stoopid high rent, makes real estate mogul type cash flow. Let’s look at this video frame by lyin’ frame, OK?
First Frame
Pulling the common sense card from the deck right off the bat, one’s gotta wonder — if they’re such great properties, why are the so dime-a-dozen cheap? Duh. ‘Cuz nobody wants ‘em, that’s why. Was the first clue a Glock is required to get in and out of the neighborhood? Real estate is a slave to the law of supply & demand. There’s nothing special exempting income property from that law.
I have clients who’d buy them literally by the dozen — for cash — if they were really what they say they are. I’d own a hundred of them by now. No, two hundred. Why not? They’re that cheap, right? And the rents are as high as properties selling elsewhere for five times the price. Pullleeeze. You know the guys on TV are actors. Real folks couldn’t keep a straight face.
