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Strategies & Market Trends : Trader J's Inner Circle -- Ignore unavailable to you. Want to Upgrade?

To: Madharry who wrote (55256)	10/5/2022 1:02:26 AM
From: Zen Dollar Round	Read Replies (1) \| Respond to of 56535

Thanks for your reply, I welcome the debate and your knowledge. So, well, I take a couple of issues with your hypotheses about all that, and for the sake of not making that previous post of mine even longer, I left out more details of the housing market I'm also aware of. I have three friends locally who are real estate agents, two are a couple. They've told me much what you did about not being enough inventory for housing, and it was true for years here, a seller's market for sure. But.... That is changing, at least around here and on the west coast. I look at Zillow often to get comps and see offerings directly around me. The estimated value of my home has fallen ~14% since last November, which surprise surprise, is about the same time the stock market peaked. I've also noticed homes are staying on the market much longer and no longer sell within a few days. Some don't sell and all and are pulled. So the seller has a choice, lower the price more and accept less profit (or take a loss), or hang on and wait for the next boom cycle again. That's not going to happen anytime soon, so prices will continue to fall due to the higher rates. I've seen reports on local news that is happening in Seattle too, where prices have been wicked high around the city close to the tech giants here (Amazon, Microsoft, Google, Facebook, to name the biggest ones) and driven up by those workers who want to buy close to their workplaces, so those prices are coming down too. I've seen similar reports on CNBC about other areas of the country. Doren will tell you it's true where he lives too in SoCal, we've discussed it at length because he wants to retire soon and sell the home he's been fixing up and remodeling for many years. > The cook book thesis and honestly highly dubious model is yours and I guess the feds. we will raise rates mortgage rates goes up people stop buying houses other people stop building them people get laid off and prices go down. the difference being that the fed probably has 400 economists and untold computer models to predict the impact of increasing fed fund rates under different scenarios but we have seen nary a one. why is that? See my comment below about Fed computer modeling and voodoo. > I would submit to you that things are far more complex than your model I don't believe they are, one just has to take the drone's high view of it all and ignore the many noises in the forest below because they are just that, market noises created from info overload. > so is the fed better off raising rates and keeping the shortfall of housing or even exacerbating that or keeping rates lower and possibly keeping a lid on rents which make up 1/3 of the inflation number? Congress and pundits should insist that the fed start providing us with their model that they are using to predict the economy and their decision making process. What is everyone afraid of? That the emperors are not wearing any clothes? I guess I see all that as beside the point? The Fed's inner workings and computer modeling are certainly unknown, and voodoo, basically. I agree they could share their models, but should they? Wouldn't big money just take advantage of the information to profit from it, possibly working against what the Fed is trying to do and in large ways? I think that would happen. The paranoid in me believes that the market may go sidewise down till the mid term elections and then go straight up after irrespective of who gets control of the senate or house of representatives. I hope you are right! I truly do, and that people can profit from it and stay employed. I don't like seeing anyone lose money or their jobs who posts here on SI or anyone else I know in life around the country or in the world. I only shared what I think is happening so others may benefit from the info if they chose to believe or follow what I wrote. I could very well be off. Also, and I'm asking this for information purposes because I truly don't know.... Have there been any examples in the past where the Fed finessed rate hikes well and avoided deeper recessions? I'm talking about defined recessions here, the traditional two consecutive quarters of negative GDP that was always the previous measure –– that now many market pundits (including two brokers I know) are choosing to play down or ignore. That's another good sign we're heading lower, contrarian opinions trying to change the way Capitalist markets work an are measured, and have since inception. > speaking of shortages for the first time ever I found a note on my prius with 175k miles from a guy saying he could not find a used prius for sale and would i be interested in selling mine. All markets are different on the local level. That also makes stories like that anecdotal until larger trends emerge. Maybe Priuses (Priii? Hehe) are in high demand around you or in general, but other car models have fallen in price? I know around here used car prices are falling overall, and in the stock market, former used car high flyers like CVNA and KMX have been crushed as revenues have come down from pandemic highs and those forces that drove prices way up, and new car prices going up too, if you could find one for sale at a dealer at all due to parts shortages. Those charts are staggeringly bad for bulls, especially CVNA. Thanks again for responding. I want to share info and knowledge here like everyone else and learn from it, it's the reason Trader J created this thread. :-)