August 8, 2013 – Housing’s Stealth Recovery is Finished: The much-heralded housing recovery is over.
No, you won’t see a bunch of new foreclosures in your neighborhood. And I doubt the value of your home will plummet. But the big, first phase of the housing market’s under-the-radar rise is finally cooked.
That means no more easy gains from homebuilding stocks. These names were great buys in 2011 and 2012. But right now, they just aren’t performing.
The simple fact is that expectations have run wild. The rebound in the real estate market isn’t a secret anymore. People all over the country can see the pickup in sales and construction in their respective towns. They’ve bet big on the homebuilding stocks. Now, it’s a crowded trade.
“While they have made great strides in the past year, home-builder stocks have become volatile recently as investors deal with mixed economic housing data, rising mortgage rates, and, in the cases of a few overheated markets such as San Francisco, worries that the market is setting up for another painful collapse,” reports MarketWatch.
The above article is from “The Daily Reckoning” dated August 6, 2013 by Greg Guenthner.
I (your Chaos Editor) believe we are going to have a colossal bear market in the near future and I urge all of you to exit stocks and bonds. Cash, gold and oil will be a safe haven for your money. Bonds will be as dangerous to own as stocks, because bond prices move inversely to interest rates. With interest rates at historic lows, bonds can only move sharply lower in the future.
I can hear you say, “but I’ve got all my money tied up in a 401K and get a company match of x %.” In the market of the future, most people will be more concerned about a return OF capital rather than a return ON capital. We have seen the peak in stocks and bonds for a very long time – exit now.
The world peace/war index is also at a peak. Remember Ganeau’s Index (the last 2012 should be 2020 in the Chart Title below):
For those of you interested in the rationale behind this index, do a search of this subject in my blog, in terms of past posts.
From “Sum City” by W. G. Foster, pages 139 to 141:
From 2013 to 2020, the world was totally devastated by one disaster after another; as the dark cloud of karma surrounding the earth was finally dissipated and the white light of good karma began to manifest for the survivors of the world. Unfortunately, the world population had been reduced from about seven billion to around one billion.
The new world order was one of world government and one world currency backed by silver and gold. The big international business entities were gone. Society was based on local home grown foods and local law and customs. There were no longer any passports or country boundaries.
All drugs had been legalized, taxed and controlled. If you wanted drugs, you got them for free but had to stay in a “drug house” run locally. Literature was provided if you wanted to abstain and recover. This alone reduced the crime rate in half.
Law was largely a local matter. There were no more jails. The world did not end, but was vastly transformed for the good. The current world culture and civilization reminded Kathy of a poem she once read:
I stood at the edge where the mist ascended,
My journey done where the world ended.
I looked downstream. There was nothing but sky,
The sound of the water, and the water’s reply.
From, The End of the World
By Dana Gioia
The Master of Disaster