Financial Crash (2022-25)
- Thread starter Cynllo
- Start date
I disagree with you. People should be building families and communities. Not living like weak traumatized exiled fools. Full retards. If they break a leg. Let’s see how much time they last. There’s always an hypocrisy associated with this people.
People normally have a talent or a gift. And should use it. These people are a loss to society. They give a negative input. Let’s say one of them could be a great doctor. And they are there doing something probably a machine could do in 5mnts. They are living like animals. It’s anti Christian.
It’s not a rat race. That’s for the imbeciles. You can have a normal functioning life outside the rat race. The rat race is for people who buy too much stuff to impress others. Quality. Not quantity. Is key.
Look at the label and buy western. New cars are all shit. Buy pre 2000-2010 cars. When you decide to buy a house look for land and build. Or buy an old house and refurbish it. A house is the biggest financial move you make. Do it very carefully. Never ever rent. Unless you have to.
God wants families. Multiply.
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I agree largely with your points, but am curious about this one.
While a family and being an esteemed member of the community would have been nice, I took a different path. Worked, travelled, and perhaps enjoyed a bit too much hedonism in my 20s, but set myself up financially fairly well - but at the expense of setting down roots beyond some very solid male friendships. With MF relations and the polarized state of the west as it is, not to mentioned divorce rape laws, I'm honestly starting to think it may not happen for me. Regardless...
I always had a decent nose for finances, loved a deal, as well as financial efficiency and optimization. In Canada it just doesn't seem to make sense.
Eg, a cookie cutter 3 br home an hour outside of Toronto is a million dollars. The sort of home that 1 generation ago would have been bought by a plumber on one salary. It rents for maybe 3k/mth. Even if you put down 200k DP, at 6% interest on a mortgage, you're throwing away 48k just on interest. 36k to rent, or 48K + tying up 200k of your money, + all the other fees that go into ownership.
We never really had a 2008 here, and the signs are that it was merely pushed forward, while interest rates and home buyer incentives marched ahead inflating prices. Homes could literally halve in price, and still be more expensive compared to the US in terms of rents garnered, incomes, or other financial metrics.
The idea that "it's never wrong to buy" and "homes only go up" is what got the US to it's 2008, Canada here, and Japan to where it was in 1990.
If you're only paying 60% of the entire monthly operating cost for your place, does it not make more sense to rent?
Canadian or US dollars?
A million Canadian So 700 and change US. Keep in mind prices have already dropped like 15% due to the higher rates, but here's a sample just to show the craziness:
That place might rent out for 2500 a month if you're lucky, 1 hr from Toronto. Probably $4500-$5k to carry if you owned it, of which would be $3500 in interest, and ignoring the opportunity cost of tying up a $150k down payment. Not to mention you don't even have your whole place, just a duplex.
vs:
my friend who recently bought 30 mins outside Houston, another typical NA big city got something like this on a quarter acre.
Roughly same price, same vicinity to a big city.
As always I think memes say it best:
Again, prices have corrected somewhat and the dollar has weakened, but when that was made a year ago it was true. LA selling for the same as a town 2 hours north of Toronto with a population of 30k.
So for some of the more financially responsible its frustrating. Either enter a game where you rent money from the bank, with rates still below long term averages, at double the cost of what it would take to rent the same home from an "investor", or rent, and have all the insecurity that that entails, but know that each month your landlord is likely chucking a couple k your way. Our last big crash in 89 took 17 years to recover on an inflation adjusted basis. Buy at the wrong time and you could be looking at 17 years of dead money. If you can afford to hold on, and if you don't want or worse need to sell.
You should own your place. Not rent it. If you want to change something in the house. You do it. Renting means instability. Maybe when you are young. Unless you want to do structural changes you can do whatever you want in your house without asking permission to no one. Your house is your castle. For you to work on. I don´t have much trust for people who rent after a certain age. They are too unstable. And will not make necessary hard choices. They transfer their responsibility to the landlord.
Your wife is also your property. You are also her property. And kids are the glue of a marriage. It´s the excuse you hear in your head saying "don´t divorce. Stay." When things are bad. By bad I mean every 3-6 months there´s a fight. I would honestly pay someone who looked like me to fight with her every 6 months. It´s like those old pressure cookers. It builds and builds. And here we go... After it´s calm again for more some months.
If you don´t have kids you will not stay with a woman long. Former players are too much used to swapping partners.
Financially I would have to look. Did research on stock markets some years ago. Stocks always go up. There´s periods where you have to wait 10-20 years for them to rebound. There´s always periods of time when investing in assets is not smart. But in the long run you win by owning assets. Someone will say your house is a liability etc etc.
At worse rent with an option to buy. At this moment I don´t have loans. But the mortgage used to be cheaper than renting. I´m not investing on anything since 2018. And people should prepare themselves for 2026.
In the near future I will buy houses in tourist destinations. Because when you travel with kids. It´s either airbnb. Which are not professional and too risky. You might arrive and the booking be cancelled without notice. Or stay in hotels. In hotels. There´s no capacity for 4 people. The search is a fucking nightmare. Normally you need to rent 2 rooms. Or a suite. Which are the most expensive options. Most hotels stopped having extra beds. What I´ve been doing is booking 5 star hotels. for 2 people. And check if the hotel has an in room sofa. Some chains normally have. I send kids to sleep to the sofa. Because it´s 5 star hotel management doesn´t complain. But I can´t do this shit if it´s a package. So I have to organize it all. Will probably buy in Menton south of France. You have Italy at 20kms. Maybe buy a small car. And rent it out to BnB the rest of the year. Airport in Nice is a fucking nightmare. Work in progress.
We are in the recession, and have been. The unemployment numbers, which are a lagging indicator, will show this on Friday. The markets are actually pricing in rate cuts next year, front running the buying so that they can also get retail bagholders right now for when the Fed cuts, and the 20-50% drop ensues. It's weird but this is what they do to retail, who believes the markets will continue to run, and acts surprised when the selloff comes right when the Fed cuts, finally admitting there is a recession. So of course, it takes a little bit of time for the new printing/liquidity to set in, but (nominally) the prices come back to the previous level. Notice how even the buy and hold people who "are still back at that higher level" because they didn't panic and sell during that recent selloff, don't realize they lost the interval purchasing power, but are happy matrix participants for the government, since number goes up and they still pay 20% ultimately on the inflated long term dollars. The point is, you really have to outdo inflation to make the equities trades or long term holds worth it.
People who follow the BTC thread know that I believe there is a similar thing happening in that market. The genius of BTC, however, is that you will crush all other assets and debasement by the government over time by just holding, regardless of how "volatile" you or anyone else says it is.
People who follow the BTC thread know that I believe there is a similar thing happening in that market. The genius of BTC, however, is that you will crush all other assets and debasement by the government over time by just holding, regardless of how "volatile" you or anyone else says it is.
I agree it's better to own, but even though I can afford to pay cash for a place, I refuse to do it at the prices Canada is at now. Much like the runup to US 07/08, people turned RE into a speculative mania that bore no resemblance to the rents it could earn, or the incomes of the area. Just that even if you lose $2k a month because rents are that much less than your costs, then it doesn't matter because it will appreciate forever.
Surely there's an inflection point? If you could rent a 10 br waterfront mansion for $500 a month, valued at $20m is it still worse to rent? The other issue is simply volatility, unlike the US, Canada is forced to accept a market rate reset every 5 years, if not immediately as rates changes. Many people took 7 figure mortgages, only able to afford the interest at 1.5%. When rates normalize to their historical 7-9%, how do you afford it? Or if you sell, how does the new buyer afford it? Or at what price?
Here's a couple more examples of why I refuse to play the game as it stands today. I'm all for RE, but when you can lose half a million dollars in 18 months on what until 10 years ago was just a basic 2 story family home not even really commuting distance to a big city, I'm just going to pass.
If I owned my place with a conventional 80% mortgage, excluding any equity built, literally just tax, interest, maintenance, insurance, opportunity cost of $100k DP etc, it would probably cost me $50k a year. For a basic 1 br + den. I rent it for about 19k. Either rents need to triple (so that you'd need an income of 200k to afford to rent a 1 br + den in a tier 2 city based on 3x income) or prices are 3x what they should be.
Here's another. Even if you had the $1.5 million to buy it cash, your taxes, maintenance, and insurance etc would probably be close to the $18k a year it takes to rent it. That 1.5m is literally providing zero return, unless someone comes along and decides to buy this cookie cutter 4 br 2 car garage slightly better than average family home for $2m.
Given how life is for most people at this point, it's hardly worth it to buy and own. Exceptions are only people who know they'll be in an area for a long while and are married with kids. And even those exceptions have exceptions.
BTC is a better investment.
BTC is a better investment.
Bitcoin may be a good way to invest a portion of one's portfolio. However, I think that owning productive assets is the way to go. Owning land or real estate that pays a rent, or owning a share in a profitable enterprise. In many cases, playing a key role in the day to day management of the assets, to ensure they generate profit and income.
In this era of "you will own nothing and be happy", the patriarchal family that quietly holds onto property that can support 10 workers and their families will be remembered with reverence by their children.
I think we should do all of the above, but I also think that unless something corrects sooner rather than later regarding women and family formation, much of the things we talk about will be bloviation or irrelevant.
Why are a lot of the tweets not showing up in the embed? Many are for me, but many aren't. I can click on them and they work in a different tab.
What's going to happen today is that the "good" job news (which will later be revised of course) will actually cause a selloff, after this quick buying spree, because of the fact that they are more aware now that the Fed ain't cutting any time soon. Soon the energy will poop out, people will get exhausted waiting for Powell et al to cut, and we'll get a correction. After that correction/crash we'll go to new ATHs, probably in 2025.
Until 10 workers decide to confiscate that property. Just saying nothing is bulletproof.
I suspect there will be major changes to property ownership in the future, such as indirect prohibition of investing, too many folks will own nothing and know its final.
I think it's good to own your housing, may be a 2nd home for city dwellers. That investment mania may destroy itself, though, a lot of people are getting mad now
Over the last 18 months, about the rate of money velocity, people have been increasingly spending money on nonproductive real estate. Money that would have otherwise gone into production chains goes directly to banks and investors. With a lot of that destroyed in debt servicing.
With RV's in particular, I would think this has something to do with COVID lockdowns ending and people going to hotels and etc once again instead of RV's.
I've said it before, I'll say it again: even though it looks like Americans aren't saving, there is lots of money waiting on the sidelines, waiting to buy homes if and when rates drop. If that happens, house prices will jump again.
It's not going to happen soon, unless something breaks. Which is quite likely in the next 4-5 months.
They are moving into smaller diy-converted van units instead as can't afford an RV or a house anymore, or hotel, for that matter.
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Yeah, Sprinter Vans, Promasters, Ford Transits are everywhere now. A lot of climbers like them as upgraded camping setups, and then decide that they can save money by not paying actual rent. Throw in a high cost of living area and they're ubiquitous.They are moving into smaller diy-converted van units instead as can't afford an RV or a house anymore, or hotel, for that matter.
I've met travel nurses who take gigs for 3 months and live out of their vans at the hospital, then pocket the $1k/week living stipend that is untaxed. Others who are software engineers and live out of vans between days at the office.
For some, it is their frugal way to save lots and not waste all their income on ever-increasing rent, and don't intend to do it for long. It also seems like a modern-day trailer park movement.