Regarding real estate values in Silicon Valley:
Historically low interest rates, billions moved out of the market and into real estate to hedge, and the everlasting desirability of your area could have something to do with it.
I'm not sure that Silicon Valley represents the scope of the American experience, and I don't mean that in a bad way.
I've been reading about the housing bubble lately; that the value of rental properties could get hammered when rates go up, especially if that should be forced to occur on the heels of a sputtering job market and overall economy. And that those people who bought at the top of THAT market will have their financial well-being threatened as a result.
Not to digress, but any thoughts on that, c.i.?
(I'm on dial-up this week as I am in one of my company's satellite offices. I've already spent too much time reading and posting here today...will check back later in the week.)
My thoughts regarding stock and housing valuations are as follows:
There has been and always will be, cycles for both of these indices. Those who land on their feet must do one of two things:
1. Outlive the "long term", and never, ever need to spend down, or borrow against their principal. (I.E. a perpetual fixed income).
2. Have the courage of a bungee jumper, and sell when markets are going to the moon, and everyone else is BUYING! Very few humans have this ability!
C.I.
I have a son who lives in California.
Whenever I am in that "place" called California, I am overwhelmed by the amount of sheer wealth, and the number of millionaires that reside there.
From Mexico, to the coast of Oregon, the number of multimillion dollar homes and wealthy people, is simply staggering beyond belief.
One last thought!
"The rich we will always have among us." Somebody, said.
And no markets....no recessions....no depressions....no busts....will ever deplete their wealth.
P.S.
C.I.
A lot of those high flying BMW buyers of which you speak: both in California and New York, have been reduced from a wealth of tens of millions of dollars to only meer millions of dollars.
If I had twenty million dollars and lost 80% of my wealth....am I really broke?
KYN2000, You're not broke if your net worth is over 2 mill.
c.i.
C.I.
Always, (from away back) a distinct pleasure to read your thoughts.
And this has been a most informative bit of thread with PDiddie, and all others, casting some interesting insight.
D
PDid, San Jose, or Silicon Valley, has one of the highest average salaries in the US at $75,000. Most of the world's high tech and communication companies have offices here. On the other end of the scale, with the high tech bust, many middle class families are going to food banks to feed their families. Many of our friends have sold their homes here to buy new ones in the Sacramento valley. They sell for 3/4 of a million, and buy a new home for 2 - 3 hundred thousand, and pocket the rest for their retirement fund. My wife doesn't want to move from here, so some of our net asset will remain in our house. So goes life..... c.i.
The bear market will be with us for about 4-5 more years.
Only fools time the market. You ride the waves and try not to drown. If you feel an allergy to water developing, try another "sport".
KYN2000, Your quote: "My thoughts regarding stock and housing valuations are as follows:
There has been and always will be, cycles for both of these indices."
Actually, there will always be cycles for the world economy which affects housing and stock valuations. We just need to hope that the world economy doesn't suffer a long-term depression that will destroy both the stock market and housing valuations as they have in Japan.
c.i.
C.I.
Absolutely!
A "world economic depression" would indeed disrupt, and temporairly throw all markets to the winds.
However, as I state above, if one can endure the "long term" ( and just how long has history shown one of these depressions to last, C.I.?)....one can survive.
My main point, C.I. is that the truly wealthy, will all sail very happily through any economic thrashing that the world can dish out.
Only a global environmental catastrophe, on the scale of a nuclear attack, would begin to cripple true wealth.
For the little man (most of us) who have learned to live frugally and with a modicom of "grit" and self denial i.e lack of debt: can s/he too weather the bust of which you speak.
Many of the truly wealthy have their eggs in one basket; their company stock. I remember when Bill Gates was worth almost 100 billion at one time, and when the high tech bust happened, he was worth half that amount. It's true, the truly wealthy will weather almost any world depression, but if that happens, there won't be much to buy in terms of goods and services - no matter how much money one has.
c.i.
Here's another personal observation; I'm willing to pay $100 to go see a live show in London, but refuse to pay .79c for one pound of banana. Is that strange, or what?
c.i.
C.I.
Again, thank you for continuing to open up new revelations and angles of looking at a topic!
Indeed!!, to be wealthy today in Iraq, given the current conditions, would put oneself in a position of having plenty! But......so what?
What the wealthy will always have, no matter the times, is "insulation".
Not health! No, they will be like the rest of us when it comes to sickness.
But their money (of which they will always have) will protect them from exposure to the elements of stagnation and depression.
And the rest of us who may be (caught unexpectedly) without means, will surely accept the largesse of those wealthy and continue to provide them, that insulation.
As it has always been.
No ci, not strange. However, is it strange that the average American eats 15 pounds of potato chips/year and helps to keep PEP stock up ?
Go Chips!
Sorry to say that the rich do get better medical care than the poor. Have you visited a hospital or a top MD lately?
Do you know that the rich have private rooms on whole floors in many Harvard-Hospitals in Boston? It does pay to have $$ and it
s!ucks to be poor. Ask the homeless or the unwed mother on welfare.
NH, Looked from another way, the poor in this country gets better medical care than the rich in third world countries. c.i.
"....the poor in this country gets better medical care than the rich in third world countries. c.i....."
Not sure that's true.
The poor in this country?
Have you heard the story of the young woman who sat for 8 hours in the ER of a major NYCity hospital, waiting for care? Her appendix ruptured and then, the "healthcare providers" decided to
"provide" some care.
Do you think the Kennedys sit for 8 hours in the ER of the Mass General Hospital in Boston, waiting "for care"?
NH, Some people in third world countries have nowhere to sit. Some wait for days before they are seen. c.i.
How much are these people paying in health insurance premiums?
Please return to the topic.
Begin a new thread if you wish on healthcare.
