Comments by "worn down" (@worndown8280) on "Michael Bordenaro" channel.

  1. I got to disagree, short term rentals should not be allowed in residential areas. They compete with and are not regulated the same as actual real motels and hotels. Its an unfair market. But ultimately, its up for each community to decide. But like I said, I would ban them utterly in residential communities.
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  2. Problem is none of these people got it put into a contract. If they did they would be able to ask for compensation for breach of contract.
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  3. This is he same thing that happened in 2006, everyone jumped into the flipping market, but by the time they did the market was already turning. A lot of these flippers are going to lose everything, again.
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  4.  @Falconlibrary  indeed, but buyers can generally wait, sellers dont always have that option.
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  5.  @lottoCIZZLER  I had neighbors who bough a home in 2007. They didnt get thrown out until 2017. They would make a partial payment every 6 months to restart the clock. Its obscene what some folks got a way with. Just so banks didnt have to write off all that bad debt in one go.
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  6. Ive never seen a pension plan that required working until 65. I think you dont know what you are talking about, respectfully. Historically the average pension plans paid out when a worker was no longer able to work or when a worker turned 50 or 55. They could be pushed back further for an increase in payments, because pensions are just insurance and it is done via actuarial tables.. It was not designed to keep a person at their working standard of living. It was designed so the person wouldnt have to depend on their children or die destitute on the streets if they didnt have any. The problem came in the 1970s when unions wanted ever increase pension benefits due to increases in inflation and so companies not telling the workers sorry we can afford it long term, agreed. And kicked the can down the road until they went bust or had to renegotiate. In the 1980s the same thing happened in public pension systems. None of them are sustainable. But people want to believe in magic money, because reasons.
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  7. People wont have a choice when they lose their jobs, 3% mortgage or not. This is the same thing that happened in 2009 when most companies started shedding workers. Then, even if you keep your job, housing prices drop and your 3% loan for a 400k home that you felt lucky to get is now only worth 250 or 300k and then you do the math and decide if its cleaner to walk away. A lot of this is just people trying to cope with being in a very hard economic position. Though I wish you luck.
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  8. First man in the life boat may not have all his possession, but he has the most important one, himself.
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  9. The ones who bought at the peak are the ones who enabled all this.
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  10. I think you are focusing on involuntary foreclosures. During the GFC many of the homes foreclosed on were voluntary foreclosures, aka, jingle mail. It remains to be seen how much that will be the case this time. But with inflation pushing more and more people to the edge, it may just not be an option to refi into a 40 year loan. Can you imagine a 40 year old couple refi'ing to a 40 year loan? They would be in their 80s before they paid their home off. Which means they cant really afford their how and better in letting it go. Also for those worried about the RIETs, during the GFC they lost on average 72% of their value. And they were better capitalized then than they are now.
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  11. Even the areas that are "flourishing" home wise, often are only doing so because of outside money. They raise the price of real estate higher than the old locals can afford. Eventually, when there is no more new money from the outside coming in, prices slide back to the median. That is what we are going to see in a lot of these growth states. You are already seeing it in Tennessee.
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  12.  @mg-by7uu  how are we destined for hyperinflation when the money supply is decreasing at the fastest rate since the great depression?
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  13. When everyone makes 85k a year, 85k isnt a lot of money. Its the median income. Thats the problem with California. People see high salaries but that always inflates the cost of everything. Its all make believe.
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  14. If the Fed pivots before the current inflation is destroyed we will have the worst of both worlds. We will have an economy damaged by the previously increasing interest rates and job losses but once the pivot happens inflation will explode and we will have something every modern economist think is impossible, an inflationary depression/recession. Eventually to fix the economy you will have to raise interest rates, again, this time exceeding the inflationary rate to kill it. But in the mean time the economy gets wrecked. People lose jobs assets lose value and that includes homes. Throw in demographic trends and this makes inflation via wages, due to lack of workers, almost impossible to control. The next few years will be interesting.
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  15. The year California became a state they received so much rainfall that the whole of the central valley was covered with water some places 40 feet deep. You could take a steam boat from Shasta all the way down to what today is known as the Grape Vine. The Napa valley and the river there is famous for flooding this time of year. Most of the delta levees and all the dams built in the Sierra's were built not for water collection but flood control.
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  16. There is more sub prime auto debt now than there was sub prime home debt in 2006. Then you add student debt, mortgage debt, corporate debt, government debt. The debt is going to crush everything. And then you add in it the demographic trends, this will not only be worse than 2008, but it wont recover, at least in the housing market.
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  17. The unemployment rate is a lie, you really have to look at the labor force participation rate. And right now we are equal to the mid 80s when a lot of wives still stayed home to keep house and raise children. The economy is worse than anyone thinks.
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  18.  @WORLD-OF-MERLIN  I got nothin. lol
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  19. This is what happens after you hit peak demand. When demand in Japan peaked in the late 80s early 90s, Tokyo real estate was the most expensive in the world. They locked people into multi generational 100 year loans. Now in rural Japan they are giving away multi acre estates. The same will happen here, even with immigration. It will just take longer.
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  20. Nah, the lender sells the mortgage. They service the loan though and take a cut of that. They arent even the bag holder. Then the people who bought the mortgage has to sue the bank, which the Federal government wont allow. Its way worse than you think.
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  21. In regards to SPS, this is literally what the banks did back during the start of the Great Depression. At the time the lender could call in the loan at any time. And almost all mortgages were only 5 year notes. So many lost their farms due to this they changed the law because it began to effect the US food supply. In some communities during the auctions for the properties they would pool their money and buy back the farm for the local farmer. Looks like history might be repeating itself. Considering Wells Fargo's recent moves something is clearly afoot in the mortgage field.
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  22. wait until people have to start paying on their student loans again.
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  23. The economy was never "good" since the last crash. It was papered over and interest rates went to the ground. We never allowed it to go down to where it could recover on its own. And then we pumped it up more. Its still going to go down to that level, and now we dont have anyway to stop it.
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  24. A lot of places need workers like crazy. I am in East Tennessee and I saw a Panda Express last night that was paying $18.00 bucks to start. Right now we have a crazy misallowcation of labor. Hopefully this next recession will sort things out a bit.
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  25. We dont have the electrical generation capacity to charge these electric vehicles. We would have to triple our energy output to charge them. No way the greens allow that to be done. Electric cars just arent going to cut it.
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  26. interest on treasuries is already above the cap rate most land lords get. They thought we were going to pump up to 5 then quickly drop back down. I think a lot of these land lords and Air BnBs are going to end up shaking out. Why make a 4% return and deal with all the bs on a non appreciating asset, and in some place a depreciating one, when you can buy a near risk free US treasury?
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  27. I remember when appraisers went into the home and in the attic and in the basement or the sub floor. Now they mostly just drive buy and check comps. Its a scam.
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  28.  @lovetai9401  I have a lot of friends who are in tech. They were talking about moving east and I said before you do make sure you get that in writing. All of them told me their employers wouldnt do it. But at least they asked and prevented themselves getting screwed over. I am glad your husband got his in writing though. That I80 drive to the bay area isnt a joke. lol
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  29. If the economy loses a million and a half jobs its ok. We have 10 million currently open. That is the problem. There is so much excess demand, from a decade of Fed purchasing assets and endless money printing and low interest rates, that a recession and job losses are the only way to address it. The bad news is that losing a million and a half jobs isnt going to be enough, that will mean we still have 8.5 million jobs open. And because of boomer retirement we will have at minimum 400k new openings every year. So interest rates will be going higher and longer than most people can believe. Things have only started. And once oversea markets start imploding, like Japan, China and Germany are currently doing (wow the next top 3 economies), all the things they once supplied us will have to be built here in north America again. This will increase job demand even more leading to more inflation. This is what the end of globalization looks like. Everyone being poorer.
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  30. The ugly truth is modern retirement schemes were never sustainable. No one wants to admit that. Things need to return to the old way, where the elderly are cared for by their families. That is what will happen. Except for all those who have chosen not to. That is when the whole retirement thing will get really ugly.
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  31.  @gregorysagegreene  Yea there is more sub prime auto loan now than there was sub prime home loans in 2006. Its going to be ugly.
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  32.  @gregorysagegreene  Yea its going to be a dumpster fire.
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  33.  @gregorysagegreene  I mean, ive been called worse. lol
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  34.  @michealsizemore1  There is an equally bad side to that as well. Many people will lose most of their wealth. Boomers who had assets to spare no longer will and will become even more dependent on younger family and the government. This will also limit the amount of wealth the Boomer generation will be able to pass on.
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  35.  @MM1902KB  Its a political joke, and a bad one at that.
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  36. And student loan payments are still frozen. You can bet when Congress debates the debt ceiling that is going to end. Lots of young folks have a lot of student debt and auto debt to pay down. There is more sub prime auto debt now than there was sub prime home debt in 2006.
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  37. Get your own chickens and feed them. Dont buy their products. Or you can go on the internet and cry about it. Or you could just buy their stock. You have a lot of options.
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  38.  @Falconlibrary  yup I agree
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  39. 23% appreciation of an asset in 5 years is less than you would get if you put your money in a 4 week t bill and flipped it for the same 5 year period. Current home prices exist because people are stupid, ignorant or had free money to burn. The free money is gone, the ignorant can be taught. And there are only so many stupid that they alone cannot prop up any market. They just end up being bag holders.
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  40. very punny.
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  41. Since you work in that area, can you explain the economics of this area? How do people afford 10k a month rent or a mortgage on a 5 million dollar home in a normal residential neighborhood?
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  42.  @MichaelBordenaro  ah I see. gratitude for your response. I enjoy your content.
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  43. Your words betray a falsehood. That rates are high. Historically these rates are slightly below the norm. The psychological effects that this IS the new normal have yet to take effect. Once that sinks in, then market psychology will change. Not until.
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  44. Ask yourself when ANY majors in real estate have ever said there will be a ten to 20 percent "correction"? Just once, can you name any time where they have said housing will go down? Even during 2006-2012 they kept saying..." this year housing will stabilize and we should see returns to growth". That should tell you how bad it is going to be. They are saying there will be losses so they wont be liable for all the money lost that is their clients. But the end result of this has and will always be for the majority of Americans, they will have a lower standard of living. But thats what happens when you live off debt for 80 years.
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  45. Ah you listened to the AFRTS minute. Always pay yourself first. Those little skits they had on TV uin the 90s always made me laugh.
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  46. This is ultimately because of rising rates, not liquidity. The treasuries that all these banks have bought over the last 5 or 6 years only give .25% of a return. So if they have to sell them to raise liquidity they are next to worthless. So banks lose out on their total return, which due to inflation would already be a net loss, but have to sell it at an actual loss to get cash. This gives a bank a double hit on their balance sheets. Every bank has these treasuries. So on paper they look perfectly ok. But if there is ever a need to draw cash from said bank, they will all pretty much go bankrupt. This is just another poisonous side effect of leaving interest rates to low for to long.
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  47. How do you grow economies when a large majority of nations have demographics that are in active decline or are at their high points? You dont. Nations with export economies like Germany, Japan, and China, among others, are the first who are going to suffer with contagion spreading rapidly. This time you cant print or drop interest rates lower without massive inflation. Nope. Only a lower standard of living will resolve this. Party is over folks.
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  48. Hard to be in a recession when the governments spends so much money it is now 40% of GDP. Only time its ever been that high is WWII. If the private sector fires 100k the governments will just hire that many more.
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  49. The issue isnt that there is a home affordability issue. Its that the home distribution among the age cohorts is not distributed in a normal way. Right now boomers own 44% of all single family homes. But they dont make up 44% of the population. As they age and die, those assets will move through to the younger cohorts. Going forward as the boomers die and the zoomers come into the market we are going to have a housing glut. Even if you put the zoomers and gen alpha together they do not equal the size of the boomer generation. Right now we are just past peak demand. Its all downhill from here. This will be much larger in places like Europe and Canada where the demographic age cohorts are even more extreme than in the US. It still shocks me how blind most people are about this.
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  50. Look at the US demography. It will tell you what real demand for everything will be. And considering Boomers own 44% of all single family homes, We will easily see a return to 2012 numbers adjusted for inflation. The demand, real demand, just isnt there.
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