• Every so often, I try to make a point through these newsletters.  This is one of those instances.  Bear with me.
    I’m feeling overtly positive right now.  Very ‘glass is half full’.  Not necessarily any kind of justified positivity incited by stupendous macro-economic data, just viewing the world through rose-tinted glasses.
    Let’s talk hard numbers:
                     1)  The consumer price index came in flat at +0.1% month over month.
                     2)  Unemployment is hanging out in the high 9% range.
                     3)  Our economy is growing at slower than a 2% annualized rate.
                     4)  New problems concerning improperly filed foreclosures and overly skittish lending
                     practices are plaguing our housing system with more problems than it is prepared to handle
                     in its current iteration.
    None of this bodes well for a prompt and robust rebound in home prices.  Flat job growth, flat eco­nomic growth and flat price movement means, for the time being, everything is kinda chillin’ where it’s at.
    So here’s the reason I have a big, dopey grin on my face: I am an integral part in a certain sector of this fine nation’s economy, the housing market.  And as badly as housing has been hammered, there really are no domestic stand-out sectors for investors to throw their money at.  Sure, you can point out vari­ous emerging markets or commodities that have enjoyed a good rally as of late.  Heck, I’m sure there are even stocks out there that have been kicking butt and taking names.  But you can’t point out an overall market that has safe, non-volatile growth right now.
    And just because we’re in recovery from a nasty recession doesn’t mean people aren’t still seeking a solid and stable return-on-investment.
    So, I’m not gonna lie to you and say that housing is primed for a bounce.  It’s not.  But what can you point towards that IS ready for a bounce?  Equities, as measured by the Dow Jones Industrial Average has enjoyed a near 75% rebound from it’s 2008 lows already.  Housing has not seen any sort of com­parable gains.  Bonds are yielding investors…. the safety of knowing they’ll get their money back eventually.
    So, what do you see happening first: Stocks moving from where they’re at back up to the sugar-high 14000+ level or that $80,000 place appreciating back up to a reasonable $100,000 price?
    Right this second, we are in a world of confusion.  Problems of unprecedented size have been thrust upon our best and brightest and they are doing their best to navigate us all through it.  However, it is a painful process of trial and error that will be further complicated by the winds of political change sweeping through Washington.  All we are doing right now is establishing a rock-bottom floor for real estate prices to launch off of and extend away from for the next few decades.  It’ll have blips of ups and downs, but the trendline will likely stay positive for a long while as we get our feet back under­neath ourselves and move forward out of this dry spell.
    This gigantic slowdown is offering all of us at the ground floor an opportunity to get our financial lives straight and capitalize on the current depressed market.  I’m not trying to sell you that housing is a sure-fire bet, but I am at the very least trying to remove the entire sector from ‘economic pariah’ status.  People gotta live somewhere.  Population is growing.  Florida is a nice place to live.  You do the math.

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