Monday, April 28, 2008

Great Ron Paul Interview on CNN

You can hear the conversations at the water cooler now... People noticing the run away inflation, people realizing that their government is corrupt and incompetent. It is kind of satisfying to see everyone else start waking up to what we have been talking about this past year.

Spread the word that the revolution is not going to end and get your copy of Ron Pauls Book here;

Sunday, April 27, 2008

The desperate real estate ads on craigs list are starting to become really entertaining.

$187 Kind Hearted Investor Needed, Please Buy My Condo (Kahulu) (map)

Reply to: see below
Date: 2008-04-26, 5:21PM HST

I have a completely remolded condo at Harbor Lights that I am in desperate need to sell, It has a great Location between The UH Maui Campus, Our Main Mall, and the Ocean, with garden and pool views,

My Story,
I worked through High school and then through college full time to support myself and in that time saved every extra dollar, 2.5 years ago i bought an investment property to get into the realestate game, i then completely renovated it to top of the line, Im 22 now and the GM of a popular maui Restaurant and in need of some help, I bought the condo for 195k put 60k into it and now 0we 187k, everything was fine until the adjustable rate mortgage went through the roof and totally changed my lifestyle, i am currently homeless because i cant rent a place and cover my mortgage (if my renters were to move out) So it's a really bad situation...

The Specs:
Rental Income $1250 monthly, $15k annual
Maintance fees $592 monthly, 7104 annual
Propety tax 100 monthly, 1200 annual

which means: approx. $6k net rental profit or 3%of your investment(which sucks)

but if the market returns to it's previous Peak of $250k in five years it would make your investment a 10% return which really isn't bad but thats if it is completely paid off,

Pleas consider:
call Luke


LOL! This is starting to become comical now.

Couple of things to point out here; I love how he ads up the expenses at ONLY $8,300 per year for just taxes and association fee's and claims the place is 6k cash flow positive property. He of course totally neglects to factor in the mortgage he is paying. In fact I estimate that his mortgage alone with a subprime arm probably costs him 18K a year.

This place is really a 12 grand per year money trap. And that is with a renter living inside it.

Second thing... If a place only rents for 1200 a month... Its only worth 120,000-130,000 dollars.

Its all about the fundamentals baby.

Tuesday, April 22, 2008

Ron Paul: House Of Cards

Are you ready to listen now?

Global food riots and Hyperinflation.

33 Countries around the world are now in unrest over high food prices.

Monday, April 21, 2008

THE THIRD HORSEMAN RIDES: The Global Food Crisis... Financial Armageddon and Biblical Prophecy.

Some interesting facts to consider...

  • Wheat prices have risen by 130% Since March of 2007
  • Soy Prices have risen by 87% in the same time fram
  • Rice prices have jumped 50% in the past 2 months
  • People are rioting over food in Haiti and SE Asia.
  • Farmers are guarding fields of Rice with AK-47 Assault rifles.

I don't take the bible literally by any means, In fact I don't even attend church, but this verse scares the hell even out of me due to recent events.

The third horseman rides

The third horseman is described in Revelation 6:5-6, “...and there before me was a black horse! Its rider was holding a pair of scales in his hand. Then I heard what sounded like a voice among the four living creatures, saying, ‘A quart of wheat for a day's wages, and three quarts of barley for a day's wages, and do not damage the oil and the wine!’” The third horseman of the apocalypse refers to a great famine that will take place, likely as a result of the wars from the second horseman. Food will be scarce, but luxuries such as wine and oil will still be readily available.

What does this mean?

The Expositor's Bible Commentary explains regarding this passage: "This amount [of money] suggests food prices about twelve times higher than normal ... and implies inflation and famine conditions (Matt 24:7). A quart of wheat would supply an average person one day's sustenance. Barley was used by the poor to mix with the wheat." Food shortages cause inflation in food prices. And higher prices make the remaining food harder to afford.

Oil and wine, though, are typically symbols of plenty. The reference here could indicate there will be pockets of abundance in the midst of famine. Christ's reference to famine "in various places" (Matthew 24:7) indicates the same possibility.

The cry to not "harm" the oil and wine could represent attempts to safeguard the pockets of abundance against plundering. However, The Living Bible interprets the phrase in Revelation to mean that there is practically no oil and wine left. That would also fit with the admonition that what is left not be harmed—lest there be none left at all.

In any case, the opening of the third seal indicates the onset of a period of severe famine unlike any in the past. While famines of varying severity have struck throughout history, it appears things will get much worse. Most of us have seen pictures of famine in our time, usually in parts of drought-stricken Africa. In 1984, a famine in Ethiopia developed through natural means, but was aggravated by the unstable government. Millions were at risk of starvation.


As investors continue to flee the real estate market and purchase Gold, Oil and Commodities as safe havens prices will continue to escalate and inflict hardship and perhaps even destruction on the very poor around the world... Even the poor and middle class of America are starting to feel it. There is no end in sight, and it is going to get much worse.

Oil sets new Record, The standard of living of the middle class erodes further.

Oil prices shoot to record 117.60 dollars

LONDON (AFP) — The price of New York crude oil shot to a record high 117.60 dollars on Monday as traders seized on unrest in key producer Nigeria, the weak US currency and OPEC's refusal to increase output.

Later Monday, New York's main oil futures contract, light sweet crude for delivery in May, pulled back to 116.53 dollars, down 16 cents from Friday's close.

London's Brent North Sea crude for June hit a record 114.86 dollars but then slipped back to 113.83 dollars, down nine cents.

Sucden analyst Nimit Khamar said the market was "supported by geopolitical concerns surrounding Nigeria and comments from OPEC, who over the weekend once again reiterated their reluctance to increase production."

Monday's record-breaking run beat the previous highs set on Friday as news emerged of another pipeline attack in Africa's biggest producer Nigeria.

The most prominent militant group in Nigeria's southern oil-producing region said it had sabotaged two pipelines, possibly belonging to Anglo-Dutch oil giant Shell and US peer Chevron.

An email sent to AFP early Monday said that "Commandos from the Movement for the Emancipation of the Niger Delta (MEND) in continuation of Operation Cyclone attacked two major oil pipelines in Rivers state of Nigeria.

"The pipelines may belong to Shell and Chevron," the message added.

It described Operation Cyclone as "the crippling of the Nigerian oil export industry."

There was no immediate confirmation from the companies named. The raids followed similar sabotage of a Shell pipeline on Thursday, when the group promised "many more" such attacks to follow.

Shell, Nigeria's largest oil operator accounting for around half of the country's 2.1 million barrels per day output, has seen a wave of attacks on its facilities in recent months.

Also over the weekend, OPEC president and Algerian Oil Minister Chakib Khelil said that there was no need for an immediate hike in production.

He said the cartel, which produces around 40 percent of the world's oil, "does not need to raise output in the near future," according to Kuwait's KUNA news agency on Sunday.

The Organization of Petroleum Exporting Countries has defiantly held its daily output quota at 29.67 million barrels since its last meeting in March, despite repeated calls from US President George W. Bush to hike production.

Oil prices are unlikely to fall back below 90 dollars, the Venezuelan energy minister Rafael Ramirez said on Monday.

"We believe that prices will remain around this level, at least around 90 dollars," Ramirez told reporters on the sidelines of the International Energy Forum in Rome.

"Oil prices can't fall" much further because "production costs have increased," he said.

Iraqi oil minister Hussain Al-Shahristani argued that an increase in OPEC production would not bring relief since prices were being driven primarily by speculative investment in commodities.

"There isn't much OPEC can do," the minister told reporters.

An increase in output "is not going to solve the situation. The solution is in the hands of the speculators. They're the ones who are fixing the price and not the producers," Al-Shahristani added.

In recent months, oil prices have also been boosted by the weak dollar.

The sliding value of the US currency makes dollar-priced goods cheaper for foreign buyers and therefore tends to encourage oil demand, traders said.

America is slowly becoming a third world banana republic where there will be two classes of people. The ultra Rich and the dirt poor. $4.00 a gallon gas is destroying the standard of living of millions in the USA who could barely make ends meet as it is and now have to make the choice between putting gas in their car or food on the table.

For minimum wage workers, it is reaching a point where it may not even be worth it to drive to work, considering it could cost 2 hours pay (after taxes) worth of gas just to get to work and back that day.

To the ignorant, clueless, American idol watching Americans who ignored Ron Paul. I bet you are going to start waking up real soon.

Sunday, April 20, 2008

House prices are STILL to high!

Thinking of buying a home since prices have fallen this past year?

WAIT! prices will come down even further. The picture above shows the prices of a median priced home in conjunction with median household disposable income adjusted for inflation through the years.

Check out a close up view the graph HERE.

For the realtors who are calling a "bottom" on the housing market take a look at the graph and tell me how you get that information. We still have a long way to fall.

Tuesday, April 15, 2008

YES! PRICES WILL RETURN TO 2000 LEVELS, and there is nothing you can do to stop it.

There are still clowns on Miamicondoinvestments who are in denial that prices will return to 1999/2000 levels in Miami.

I have said it before and I will say it again.


People did not pay 300 sq.foot for condos in Miami to enjoy the great view from their new home.
PEOPLE PAID 300 sq.foot because they thought in 3 months they could sell it to a bigger fool than they were for 350 a sq foot!

The music has stopped and the game of musical chairs is over and this time the last person who bought the condo is screwed! Because no one will pay the same price until 2035 when the median income catches back up with the ridiculous price you paid!

Ask yourself this question...
Who wants to live in a 800 sq foot 1 bedroom?

1)A rich single guy with a six figure income?…
NO… He will own a much larger, more luxurious place to impress the hoes because his income demands it.

2)A Young married couple buying their first home?…
NO…They will be planning on having kids and will either buy a house or a 2-3 bedroom condo.

3)A Married couple with children
HELL NO… The kids will have no where to sleep.


People who buy 800 sq foot 1 bedroom condos are college kids, poor single guys and girls just out of college working a 30k-60k a year job (THE MEDIAN INCOME FOR MIAMI IS 40K)

THEY WILL NOT PAY 200 or 300 sq foot anymore, those days are over because the flipping is over for good. They will buy a house to live in and they can afford 75-150k places.

Why people think that prices will not return to where they were in 2000 really flabbergast me.



Thursday, April 10, 2008

Obama, Clinton, and the Criminal News Network need to wake up. Americans don't want a housing bailout!

Obama is really starting to piss me off!

As much as it bothers me to say it, after his blatant disrespect of Ron Paul, John McCain is starting to look like a good option right now whenever I hear the candidates talk about the housing market.

Obama was on CNN Today giving a speech about how he wants the government to bail out home owners (Debtors) who were (Greedy) taken advantage of during the housing bubble.

He was bashing McCain for wanting to "just ignore it and stay out of it". The truth is that McCain's intention is to just let capitalism run its course and allow the market to correct itself via house prices crashing back to affordability.

Obama thinks its the governments role to reward the irresponsible and artificially prop up house prices with bailouts at the expense of tax payer money. He is making a huge mistake of course because the vast majority of Americans are totally opposed to a bailout.

  • Americans who already lost a home to foreclosure don't want to see other people get a bailout out just weeks or months after they lost their own house and did not get the same chance.

  • Renters want to see house prices crash so they can afford a house of their own without having to resort to financially suicidal exotic loans, and paying 50% of their income on house payments.

  • responsible homeowners/Debtors who put 20% down, got a fixed rate loan and have some skin in the game don't want to see gamblers who put 0% down with sub prime arms get rewarded with frozen interest rates, and bailouts that benefit the gamblers more than themselves.

Basically the only people who want to see a bailout are the communist and the gamblers. Why the media and the Democratic party is pandering to such a slim, shameful minority is sickening.

Obama... The poll numbers are out, and posted below... If you want to win this election you better distance yourself from Hillary and the failed flippers and change your stance on a housing bailout ASAP!


Rasmussen Reports has conducted several polls that center on the mortgage crisis. Between March 19 and March 20, they surveyed 1,000 adults to see how many Americans think homeowners and banks should be helped out by the federal government. Here's what they found:

Should Homeowners Who Borrowed More Than They Could Afford Be Helped Out By the Federal Government?


Of the 1,000 adults who responded to this question in Rasmussen's telephone survey, the majority said that the federal government should not help out homeowners who borrowed more than they could afford. Twenty-nine percent disagreed, saying the government should offer assistance, and 17 percent didn't know how to respond to the question.

Should Banks That Made Bad Loans Be Helped Out By the Federal Government?


Survey respondents were not as sympathetic to banks. Sixty-one percent those who answered the question thought banks should not be helped out by the federal government. Fifteen percent of people felt government action was appropriate and 23 percent were undecided.


The people have spoken!

Wednesday, April 9, 2008

Housing Crash: Its all about the Price Per Square Foot

Want to know if a house or condo is over priced or a great bargain?

Its simple!

Just figure out the price per square foot.

Of course there are other factors that will influence the price of a house such as school district, size of the lot or land the house is on, if the house has a garage or an ocean view. However, the price per square foot in my opinion really tells it all.

I feel a fair price to pay for your average, suburban, middle class house with standard features is between 90 and 100 dollars per square foot. Lets take a look at the price people are currently paying across the country...

Metro Areas: Most Expensive to Least Expensive (Price Per Square Foot)

Rank Metro Area PPSF Year-Over-Year Price Change
1 San Jose, CA $418.54 -8.8%
2 San Francisco, CA $367.28 -13.3%
3 Los Angeles, CA $325.42 -16.6%
4 New York, NY $292.07 2.0%
5 San Diego, CA $264.17 -21.2%
6 Washington D.C $214.07 -8.7%
7 Seattle, WA $210.20 -1.4%
8 Boston, MA $207.39 -9.0%
9 Miami, FL $176.02 -14.4%
10 Chicago, IL $171.78 -3.2%
11 Sacramento, CA $165.66 -27.8%
12 Philadelphia, PA $148.05 -0.9%
13 Minneapolis, MN $143.34 -7.2%
14 Las Vegas, NV $136.61 -25.4%
15 Phoenix, AZ $135.74 -14.6%
16 Denver, CO $127.71 -9.1%
17 Tampa, FL $117.08 -15.6%
18 Jacksonville, FL $113.80 -3.9%
19 Milwaukee, WI $105.80 -0.8%
20 St Louis, MO $105.66 -3.0%
21 Charlotte, NC $95.54 3.9%
22 Detroit, MI $94.79 -13.2%
23 Columbus, OH $91.63 -2.4%
24 Atlanta, GA $91.41 -9.2%
25 Cleveland, OH $84.91 -6.1%

Based on this figure my 890 sq foot * 94.79 per square foot should be worth $84,363.

This is actually what I think my place is worth and I am pretty impressed. When you look at some of the other cities on the list above Detroit you see that the price per square foot is just totally outrageous and has no basis in reality.

Miami was less than $100 per square foot 4 years ago, and that is where it will be 4 years from now.

My advice to all you readers... If you want to know if a price is a good deal, it should be around 100/sq ft. adjusted for inflation.

That's my formula for a healthy, affordable housing market.

Monday, April 7, 2008

My Prediction for Miami Real Estate Market: THE CRASH IS JUST GETTING STARTED

A little background history...

I was born in NYC. I moved to the Suburbs of Detroit Michigan around the age of 6 and grew up there. When I was 21 years old or so during the dot com boom of 1999/2000 I moved to Miami with two friends of mine.

We lived in a suburban area of southern Miami called Kendall, and then moved to high rise apartment on South Beach.

What I found so shocking when I lived down there is that real estate was actually CHEAPER IN MIAMI THAN IT WAS IN DETROIT at the time!

Yes, let me repeat that, in 1999/2000 it was cheaper to own a condo or house per square foot in Miami then it was in the suburbs of Detroit.

To give you an Idea, I remember 1 bedroom/1 bath condos in Miami selling for about 79K-129K and 3-4 bedroom, 2.5 bath upper-middle class houses selling for around 174K-250K

Basically real estate in Miami was selling for 100 dollars a square foot in 1999.

What I am about to show you will truly shock and disturb you...

The picture at the top of this article is a 2 bedroom, 1.5 bath townhouse in a middle class suburb of Miami close to where I lived in 1999.

You can check out the full listing here

The guy is asking $210,000 for 970 sq feet of townhouse. That is basically 217 dollars a square foot. What really takes the full obscenity of the miami real estate market into full context is when you look at the zillow listing for this condo. Enjoy

IN 1999 this townhouse sold for 88,000 dollars!!!!!!!!!! The median price home in the area was 250,000 dollars.

At the peak of the real estate market in 2006 this townhouse would have sold for 250,000 dollars and the median price home in the area was an astonishing 820,000 dollars.

HOUSE Prices in Miami FRIGGING TRIPLED, a 300% GAIN, in between 2001 and 2006!!!!

This is the icing on the cake for me...

Recent sale and tax

Sold 02/26/2002:
This dude has lived in the house for 4 years and expects to double his money and make a 100K profit.

The reality is he is in denial, and the price of this unit will fall from the 217 per sq. foot he has it listed at all the way down to the 100 per sq. foot it was 5 years ago.

The entire city of Miami is in denial, and the crash that is about to occur is of epic proportions. He could probably sell his house right now for 180K and get out with a healthy profit, however, he will be greedy and chase the price all the way down to what he paid and probably even lower to what it was worth in 1999.

My prediction...If the market is allowed to correct itself naturally, THIS HOUSE WILL BE WORTH only $97,000 in 2 years or 100 dollars per sq foot.





Sunday, April 6, 2008

Rent Vs. Buy Myths That Ruined the Housing Market

Rent Vs. Buy Myths That Ruined the Housing Market

Potential buyers bought into all sorts of rent vs. buy myths to justify buying houses that they could not afford during the boom. Now that the U.S. housing market is in shambles, people are starting to realize that renting may not be a dirty word after all.

Myth #1: Renting is Like Throwing Your Money Away

Buyers throw their money away for the first five years they own a home, because they simply give money to the bank for the privilege of borrowing money. Renters, on the other hand, pay for one thing every month: shelter. They don't pay interest to the bank, property taxes or maintenance fees. They pay rent.

Smart renters also take the money they save by renting and invest it somewhere else. Since the average renter saves hundreds of dollars every month, they can afford to invest in stocks, bonds and other vehicles that have a better rate of return.

Myth #2: There are Tax Benefits to Owning

Contrary to popular belief, buyers do not get back the mortgage interest they paid throughout the year at tax time. Mortgage interest can only be deducted from taxable income. This essentially means that buyers pay a dollar just to save 30 cents.

Furthermore, deducting interest has no tax advantage unless a buyer pays so much in interest that the amount exceeds the standard deduction that everyone--including renters--is allowed to take.

When it comes to owning, the only guarantee is that buyers will be required to pay property taxes. Since renters are not required to pay any taxes on the property they rent, it seems downright foolish to factor the 'tax benefits' of owning into a buying decision.

Myth #3: It Doesn't Cost Any More to Buy Than It Does to Rent

People can usually rent a home by paying first month's rent, last month's rent and possibly a security deposit. All the money that is paid initially actually goes towards monthly payment obligations, with the exception of the security deposit, which is nearly always returned to the renter in the end.

When a person buys a home, the money that is paid upfront is more significant and may or may not be seen again. For example, a buyer must pay closing costs (typically five percent of the loan amount) and real estate agent commission (typically six percent of the loan amount) before being called a homeowner. This 11 percent 'investment' ensures that the home must appreciate by at least 11 percent before the buyer can hope to break even.

Initial costs aside, there are also other costs a buyer is responsible for that a renter is not, such as mortgage interest, property taxes, insurance and maintenance. These costs can add up and may even increase significantly over the years.

Myth #4: Buyers Have Assets, Renters Do Not

At best, buyers have depreciating assets. Home prices are falling in nearly every area of the country. An estimated 50 percent of the buyers whose loans were originated after 2002 now owe more than their homes are worth.

Homeowners who have been paying on their homes for ten years or more are seeing their equity disappear. This means that the 'investment' they made through mortgage payments is gone--dried up virtually overnight through no fault of their own.

Renters may not co-own a home with a lender, but this doesn't mean that they don't have assets. Many renters have a large and prosperous portfolio, Star Wars collectibles (just an example) and other assets that can be sold IMMEDIATELY for cash. The reason they own these things is because they haven't been paying a lender to 'rent' money so that they could pretend like they own an asset.

Myth #5: Houses are a Good Investment

During the housing boom, everyone thought that housing was a great investment. Many people bought under the assumption that home prices go up, not down. The result of this madness is the biggest foreclosure crisis in the history of the United States.

The reality is that housing is not an investment. It's shelter. That is all housing has ever been. Self-serving organizations like the National Association of Realtors like to tell people that buying a home is a good way to build long-term wealth, but this statement couldn't be further from the truth.

Although home prices can go up (and down), the rate of appreciation on housing does not surpass inflation levels over the long-term. Between 1890 and 2004, the real return on housing was a pathetic 0.4 percent per year over the last 100 years, according to Robert Shiller, a housing expert and Yale economist.

Real estate investments aren't that much better over the short-term. The gain in new home prices over the last 20 years has been a mere fraction of the Dow's gain. The average person investing in stocks between 1987 and 2007 would have made more money than the average person who bought a new home in 1987.


...It is pretty funny reading this article, because the whole reason I stopped renting to buy a condo at the end of 2005 was because I was convinced I was "throwing away my money on rent" and that buying a condo would be a great investment that I could sell for a big profit in 3-7 years.

Instead my condo has turned out to be a financial disaster that has imprisoned me.

I really fell for these myths and got suckered.

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