2003, 2004, 2005 forecasts of real estate decline plus predictable political reaction

Oct 18, 2005:  “Just don’t be surprised when your
$100,000 home is assessed at $50,000 in a few years….”



Oct 26, 2005: “I’ve been saying the real-estate boom ended around August 1- based on stock
charts of real estate sectors [HGX, DJR, EQR, EOP]. Now that the September “lagging indicator” data
is in, how long before people say “maybe it is ending soon?”



In January 2009, President of the United State...

In January 2009, President of the United States of America, George W. Bush invited then President-Elect Barack Obama and former Presidents George H.W. Bush, Bill Clinton, and Jimmy Carter for a Meeting and Lunch at The White House. Photo taken in the Oval Office at The White House. (Photo credit: Wikipedia)

Sep 14, 2006: http://groups.yahoo.com/group/redpill_info/message/146
“So, re investing… I want to talk about real estate, again. As a recap, I have been forecasting a large drop in real estate for over 3 years now. The next paragraphs in italics highlight that.

On March 3rd, 2003, I wrote: “Unless you have a very specific reason to believe that real estate will outperform all other investments for several years, you may deem this prime time to liquidate investment property (for use in more lucrative markets).” (See http://www.gold-eagle.com/editorials_03/hunn030303.html in which I explicitly suggested that of these [5] markets: commodities, stocks, the mining sector, real estate, and bonds, the best two were commodities and the mining sector. And what happened?)

On June 9th, 2003, I wrote this: ” Some people think… real estate is a safe return, but how many of them recognize the assumptions involved in that conclusion?”  (See http://www.gold-eagle.com/editorials_03/hunn060903.html ) In the concluding remarks, I said: “If you still are holding investment real estate in the US next week, email me your favorite assumptions explaining why.” (No one did.)

Even after real estate was still rising, as of November 7, 2004, I did not let up. I was still making warnings with plenty of time to do some research and move a household before any crash started: http://www.gold-eagle.com/editorials_04/fibonacci110704.html

“… Some people even refuse to explore the evidence of [market] predictability. Others make naive predictions like “real estate always appreciates,” ignoring Houston, Silicon Valley, Japan, the 1930s Global Depression, and the bombing of Baghdad or Oklahoma City: “Do I hear nine million? How about eight million? Boom! … Do I hear one hundred?” (If only I had known about New Orleans….)

So does all that sound like an alarmist? That may be because I was sounding an alarm! And, it really is laughable to me how devoted some people are to real estate- indeed the the same people will say “I do not believe in market forecasting” and then say “I forecast that real estate markets will continue to be strong…” oops- except they are not strong and haven’t been for at least a year.

On 9/6/05, I wrote about oil primarily, but including how oil markets effect real estate markets. Still, “Real Estate” appears 43 times in  http://www.financialsense.com/fsu/editorials/2005/0906.html .

The most profound segment of the article may be, indeed, my brief, direct explanation of how the “baby boom” (a temporarily increased rate of population growth) predictably effected demand for housing, and yet how the vast majority of people were surprised anyway- at the beginning and end of that trend. Very briefly, the trend was that “the baby boomers” started turning home-buying age and then, coincidentally a few decades after the end of the birthrate increase, suddenly the number of people reaching home-buying age decelerated. Shocking, eh?

May 30, 2005, I wrote: “If you would like to review the data of what has already happened in recent years, this may also motivate you to consider re-assessing any current exposure to unstable markets and systems, including the US Dollar and US Real Estate markets.” http://groups.yahoo.com/group/Natlawmandisc/message/920

Then, over a year ago, I reported the end of the real estate rise- because I was looking for it. That report featured 5 straight weeks down in the US housing sector in August 2005. Here is a current chart on the housing sector of the US stock markethttp://stockcharts.com/h-sc/ui?s=$hgx&p=W&b=5&g=0&id=0 [Note that when I published this in 2006, the chart showed the first part of the decline shown here: http://www.barchart.com/chart.php?sym=%24HGX&style=technical&template=&p=MO&d=M&sd=&ed=&size=M&log=0&t=BAR&v=0&g=1&evnt=1&late=1&o1=&o2=&o3=&sh=100&indicators=&addindicator=&submitted=1&fpage=&txtDate=#jump ]

Recently, [again this was in 2006] mainstream media has begun to report the declining that I started reporting a year ago. You see the years of issuing alerts for real estate… I was right, again! 😉

But now [2006] I am issuing a panic alert. Now that the mainstream media is reporting what I forecast several years ago, those who did not consult accurate forecasts years ago or the news reports I gave a year ago, now they are finally starting to look at the data of what has already happened and some are naturally reacting. Each “knee-jerk” reaction can enhance a snowball effect.

I gave you my warnings, and for those of you who have not heeded them yet, this is a new warning- an alert only- but a very strong warning. The US real estate decline is now over a year old. No accelerated panic has yet begun, but once the lending market buckles, then it may be too late to exit real estate quickly. There are still many unscrupulous buyers out there… for now. Some folks will see the news and even believe that real estate is now discounted to a bargain. That might be a reasonable possibility, if not for the fact that lending markets are generally predictable.”

Real Estate Office

Real Estate Office (Photo credit: pixieclipx)

More excerpts:

Oct 18, 2005http://groups.yahoo.com/group/redpill_info/message/28

I mentioned real estate a lot already in the prior
emails…. I’ve already told you about the other dominoes that will fall after the
first catalyst triggers a drop in real estate- and
many folks seem to get some of that- but my sense is
that most folks still do not accept the possibility of
deflation (or currency appreciation in general), and,
after repeated references, I figure either most of you
basically understand it or don’t care enough to use
your search engine or even just call me and ask….

If you get that $100,000 loan because it is only
$333 per month to service the mortgage (the first
year), that is fine. Just don’t be surprised when your
$100,000 home is assessed at $50,000 in a few years….

US President George W. Bush presents the Presi...

US President George W. Bush presents the Presidential Medal of Freedom to Pope John Paul II during a visit to the Vatican in Rome, Italy in June 2004. (Photo credit: Wikipedia)

As usual, I want you all to be aware of the
larger changes in our midst. All these economic
changes will mean political changes. The President

[which was George W. Bush in 2005]

will be scapegoated (whether for good cause or not)
and likely removed- seriously.

[I meant impeached, and though Bush was not impeached,

his approval ratings went from amongst the highest of all 

US Presidents as of 2005 to among the lowest by 2008.]

If you don’t know how
big a deal a 15% drop in real estate prices is, you
will- and it should be much deeper than that. 

[a much bigger decline in price than 15%]

Political encroachments are likely to accelerate.
Since the cause of the anger of the people will not be
satisfied by removing one “public servant,”

[Note that as of now Obama has almost as many critics

as Bush did by 2008.]

and in
desperation to garner support, more international
violence (including in America) is likely…. Note this sort of
economic correction is not only what led to the vast
influx of socialism into the US in the 1930s (the New
Deal), but the scapegoating of one leader after
another was also recently manifested in the Japanese
Depression of the 1990s (which continues to this day).

After all, if it is not “them” (“their fault”), then
“we” would have to accept responsibility… to act
responsibly (economically, sustainably)! That just
doesn’t usually inspire voter turn-out like “we will
fix everything for you.”

Presidents Gerald Ford, Richard Nixon, George ...

Presidents Gerald Ford, Richard Nixon, George Herbert Walker Bush, Ronald Reagan and Jimmy Carter at the dedication of the Reagan Presidential Library (Left to right). Français : De gauche à droite, les présidents américains Gerald Ford, Richard Nixon, George H. W. Bush, Ronald Reagan et Jimmy Carter à la bibliothèque Ronald Reagan Presidential Library (1991) où se trouve une reconstitution du bureau ovale. (Photo credit: Wikipedia)

I’ve been saying the real-estate boom ended around August 1- based on stock
charts of real estate sectors [HGX, DJR, EQR, EOP]. Now that the September “lagging indicator” data
is in, how long before people say “maybe it is ending soon?”

Oct 26, 2005: http://groups.yahoo.com/group/redpill_info/message/34

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