The Rest of the Story
Boy these days we sure do hear about all kinds of stuff, but I wonder, is that the whole story and id it's not, what is the rest of the story.
A few examples before we get into what I'm really after. Lets look at housing first. Now Stock Brokers say buying a home during this time is bad, a bad decision because the house market is slow and even dead in most states and the market is due for a reset, a negative one. This one statement makes me wonder if they have land their wanting for themselves or their fake stock market is in trouble. The stock market is a whole new ballgame and I'll not even get into that on this one. Yes, the market is slow in 10 states, dead in areas of 40 more but does that make it a bad time to buy a house? That is about the most ignorant thing I've ever heard. When the market is slow and the inventory is high, it's a buyer's market. The only way it's a stupid decision is when you either are buying more real estate than you can comfortable pay for given your outstanding debts or you have a very unstable job. Everybody knows that when there is a surplus, that's when the best deals to buy comes along.
The rest of the story in that housing crash is that 1.6 trillion dollars of ARMs are coming up for adjustment and if the people have borrowed or adjusted their income to a certain amount of money they will go into foreclosure. Banks and Mortgage Brokers will lose a lot of money but maybe not what you think. If your one of many that borrowed more than 75% of the amount on your home, they will not lose like you think because you have paid their insurance in case you default. Whatever is owed plus any trumped up charges added, as well as real charges added when the property is sold the difference is paid by the insurance you sold nicely paid in the form of PMIs.
Now the rest of that story is because the Stock Brokers have rolled up Sub Prime into so many Retirement Plans, 401 Ks, and other Stocks they can say the stocks dropped, crushing the dividends, in turn crushing your retirement funds. They actually lost no money, you did, your savings. Oh and by they way we won't even discuss where the profit went from the last 10 years which will amount in the billions, some cases trillions.
Now the rest of that story is that if you don't own a home, instead buy stock which they already can manipulate so basically your buying paper where will you live? Ah, rent you say. Most people that are renting houses, apartments and condos have a loan on them, hope for your sake it's not an ARM. If these people lose the property bet the bank won't rent it to you and the buyers will go up on the rates to pay for their investment. Ok, lets say that the land lord was a bit smarter in financing or who knows maybe it was paid for. Your rent will go up as more and more people compete (with their money) to rent less and less property. If you cash out your stock, where does that leave you? Homeless and cold in most cases. So, think it's still not the time to buy when the odds are in your favor? That's not even the whole story but perhaps enough.