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Revenge?
Old 01-21-2009, 05:24 PM   #1
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Revenge?

OK, so some of us had nothing to do with the current real estate bust. We chose not to participate the illogical, irrational real estate boom. We KNEW the bubble was there, we talked about it, we were ridiculed by the crowd.

Yet we're being punished all the same. We're forced to cover their gamblings' loss.

What can we do for revenge (short of violence, of course)? Or more reasonably, how do we take advantage of the current situation for financial benefit?

Sam
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Old 01-21-2009, 05:30 PM   #2
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The only revenge I know is to short them when they looked about to fall from their horses. They meaning home builders and bankers. Now, they not only fell from their horses, but been dragged to death. What do we do? Kick the dead bodies?
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Old 01-21-2009, 05:31 PM   #3
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um...pitchforks and torches AND charge admission?
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Old 01-21-2009, 05:40 PM   #4
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OK, so some of us had nothing to do with the current real estate bust. We chose not to participate the illogical, irrational real estate boom. We KNEW the bubble was there, we talked about it, we were ridiculed by the crowd.

Yet we're being punished all the same. We're forced to cover their gamblings' loss.

What can we do for revenge (short of violence, of course)? Or more reasonably, how do we take advantage of the current situation for financial benefit?

Sam
What can we for revenge? Being able to live well will not go unnoticed. Laughing last is a close second.
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Old 01-21-2009, 05:59 PM   #5
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Having, so far, navigated these tumultuous waters relatively unscathed is good enough for me.
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Old 01-21-2009, 06:21 PM   #6
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+1 FIREdreeamer!
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Old 01-21-2009, 07:13 PM   #7
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We can buy a second home on the cheap and bide our time for a few years. Not my 1st choice for investments but should allow a recovery profit down the road.
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Old 01-22-2009, 06:06 PM   #8
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We can buy a second home on the cheap and bide our time for a few years. Not my 1st choice for investments but should allow a recovery profit down the road.
I'm thinking along that line too. Waiting for the right time to jump in.

Sam
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Old 01-22-2009, 06:33 PM   #9
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Before you know it, those "get rich in real estate" informertials will be all over late night TV again. DH and I were hit hard since we have two properties - the home and a rental. I don't think we have the heart to invest more in RE. I do, however, have a feeling this might be a golden opportunity for people with a higher risk tolerance than we have.
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Old 01-23-2009, 06:16 AM   #10
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i agree. investing in RE now might be the way to go
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Old 01-23-2009, 07:06 AM   #11
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Maybe for some, but I have enough trouble keeping the house that I live in maintained and liveable. Also I don't have the right temperament to successfully deal with tenants. The last thing I need is more property!

There is little I can do about it other than to remind myself that life just isn't fair or equitable in any way, generally, and that I can and WILL have more fun and a more productive and richer life on less money than most of those who were speculating/gambling on real estate during the boom.
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Old 01-23-2009, 08:37 AM   #12
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Too late for that. You could have sold your house, bought long Treasuries, or shorted stocks, commodities and some currencies. If you have access to an institutional investor and have a taste for the exotic you could have inked a derivative tied to the CBX index (subprime mortagages, as those values go down the value of your derivative goes up). That trick turned 600% last year.

RE is hardly a good investment yet. I was just looking at a house a friend is selling because of a divorce. I'd love to buy it for myself, but relative to my present house and $2k/mo rent it's still a losing proposition. Prices need to drop another 30% before they just break even with trend (inflation/rent/income). RE might undershoot, and that would make them a good bargain. But we have to wait a few years for that.

I sold my house, stocks and bought Treasuries. But it was a tough call, it was much harder to put your money where your mouth was two years ago! But now that's all pretty much played out, we all just have to sit it out now.
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Old 01-24-2009, 08:36 AM   #13
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My partner and I put our house on the Market in May. We signed a year lease to rent a townhouse thirty miles away. We love living in the city and want to move here.

We've pretty much given up on the house selling this year so we are looking at our options. Our realtors wanted us to drop the price by $40k. That was a defining moment for us as we decided it isn't worth it for us to sell at that price. The house is paid for and we are debt free. We both have pretty secure jobs, that gives us a lot of options.

I think we'll move back into our house by the end of March. We can use our time to put some labor into the house while we wait for the market to drop more. When the time looks right and we can find a house for a really good price, we may buy and rent out our house until things turn around.

This isn't what we had planned to do, but we aren't painted into a corner so we might as well be flexible.

I get bummed about the economy, but then I remind myself that we are actually sitting pretty good. We have a large cash reserve and if one of us loses a job we can live on the other salary. I have a job with the Feds and would probably be safe from a RIF.

I feel really bad for people who are losing their jobs, houses and everything else. These are really scary times.
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Old 01-24-2009, 01:11 PM   #14
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It is probably too early now, but start thinking about buying the REIT index soon ..... say before the end of the summer. Vanguard's VGSIX is currently paying over 7%.

This is just my guess, and what do I know? So do your own due diligence.

Cheers,

charlie
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Old 01-24-2009, 01:12 PM   #15
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Sam, I detect an undercurrent n your question of "this isn't fair." I'm pretty sure you know that the world isn't fair, just like the tax code and the weather. So it is what it is and we each get by as we can, just like in good times.

I think its a little early for RE. Housing prices appear to be "sticky" especially compared to the prices of financial/traded assets. So my best guess is that the housing market will remain at depressed prices for a while after the financial markets start staging a recovery. If that proves to be the case, I may unload some equities and bonds for some RE.
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Old 01-24-2009, 08:11 PM   #16
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Revenge? Prosecuting the criminals who were involved would be a good start.

There's a great movie opportunity here.
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Old 01-25-2009, 04:51 AM   #17
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I agree that the best revenge is to buy at the bottom. Hopefully on the day the bottom arrives someone will call me and let me know...
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Old 01-27-2009, 03:04 PM   #18
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Revenge? Prosecuting the criminals who were involved would be a good start.
There are just too many criminals involved in this, all the way from the local loan processors, the real-estate appraisers, up to the super crooks in Wall St. See an earlier thread with a link to an article about an anecdotal tale which was replicated millions of time through the nation.

$103,000~And nothing to show for it except for $15K

Even if hauled to court, they could simply claim "innocence due to stupidity". Sadly, there are laws against malice, not incompetence.

And just today, there is now talk that AIG will pay $450M to 400 of its derivative traders as retention bonus. Think about that! They mess up, and now get paid greater than $1M each to undo their own mess. With our tax dollars! How clever on their part! How stupid on our part!

Jail? What jail?

Bloomberg.com: Worldwide
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Old 01-27-2009, 05:45 PM   #19
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Yes, 99.9 percent of the scumbags will get away with it. They knew when they were committing the fraud that their chances of not getting exposed / questioned /noticed were 99.9 percent. But they were, and are, unethical. Their rationalization is "the government and society lets me do it, therefore it is not my fault, it's their fault". There are millions of these kinds of folks around.

That's why a movie about this would be great. Only in fiction could we see justice done. Think "Taxi Driver meets Wall Street Derivative Scum" or "Taxi Driver meets Local Sleaze Mortgage Broker who made $10 grand per week selling mortgages to illegal aliens at $1,000 per pop".


Actually there have been prosecutions of some of these sleazebags. It's not publicized enough though.


Whatever happened to that mafia type guy from CountryWide ? Mozilla ? He was being questioned by congress. Probably nothing at all happened to him.

Oh well, at least they got Skilling into jail, from Enron !!

Hmmm. Those Enron guys are probably feeling really abused right now. They're thinking "Hey we were doing the same thing , defrauding our customers with bogus books. We should have gotten a bailout !!!"
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Old 01-27-2009, 05:46 PM   #20
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Buy at the bottom (whenever that is...) then ride it back to the top.

I'm looking at this as a real opportunity to move up and get into a property that I would ordinarily not be able to consider. Just missed a really nice 5000ft2 house in foreclosure that sold for 48% of appraised value, but I am confident we will find another....If I can buy the right property at 40-50% of the recent appraisal value (not inflated 2006 prices) now looks to be a good time to move up. I don't want to punish a private seller in distress, but a bank with their snout in the taxpayer- funded bailout trough? That's a completely different story.

Probably never been a better time to buy a newer, bigger, better house- prices and interest rates are both down, inventories are way up, and it is definitely a buyers market.
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