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The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

5mn_Major said:
When I was young, I had the idea that real estate tax made it so that real estate was really owned by the govt and that with the tax, we were kind of leasing it from the govt.

I no longer hold that viewpoint. Imgaine a plot of land in the middle of nowhere in northern Maine that has no power, no plumbing, no roads and where no other stores for food/basics or businesses for employment because they require basic infrastructure. I'd rather just pay about $150/month to get those services and not worry about it (avg US property tax).
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I pay the utility companies for my electric and gas. The construction company builds the roads in neighborhoods, but the taxes do pay for the upkeep. I pay to the city a separate bill from my taxes for water and sewer services. So I pay taxes to the city for road upkeep, police protection, fire department response, and city parks, to some degree or another.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

St. Clown said:
I pay the utility companies for my electric and gas. The construction company builds the roads in neighborhoods, but the taxes do pay for the upkeep. I pay to the city a separate bill from my taxes for water and sewer services. So I pay taxes to the city for road upkeep, police protection, fire department response, and city parks, to some degree or another.
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In Hennepin cty, property taxes also help pay for water and sewer. That leaves just electic and gas that do not directly rely on property tax. And as we know, all corporations rely heavily on municipal infrastructure.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

5mn_Major said:
In Hennepin cty, property taxes also help pay for water and sewer. That leaves just electic and gas that do not directly rely on property tax. And as we know, all corporations rely heavily on municipal infrastructure.
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You still have to contract someone to work on it, though. Governments still don't actually build stuff. They may approve an ordinance for the use of something, and in cases may request a contractor to create a postal road or provide a subsidy for some sort of infrastructure (as you had just mentioned), but they don't actually build it, and they don't always provide the subsidy. Cable on the road where I grew up is an example; currently it is not strung out there, and will not be anytime soon.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

St. Clown said:
Samsung claims that it has already found a way to make 5G a reality when the phone carriers are able to support it. That should be a boon to its stock price someday in the future, when they can somehow prove it publicly.

http://www.foxnews.com/tech/2013/05/13/forget-4g-samsung-claims-5g-smartphone-breakthrough/?intcmp=features
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If anything, it'd be a boon now for those willing to invest in R&D. They have to start looking at it now in order to get there.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

5mn_Major said:
To answer for DrD, yes. If you're living there...tax, interest, principle, insurance all replace rent. Paid for. If you're renting it out...its a small part of the cost (in my example included in the $400 that leaves you with a clear $800 income).

Again the big difference is that real estate is an asset with huge additional value that folks can live there...which a stock piece of paper does not have.
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5mn-I am certainly no investment expert-and certainly not a real estate expert. All i am doing is pointing out how the game has changed. What is more scary, however, is how the game might be changed in the near future. There are distinct advantages to certain investments right now(real estate being one of them) that can be taken away with the quick swipe of a pen. If they can change the full retirement age for social security benefits they can certainly screw around with any deduction on the books especially that for mortgages. And it is even easier for them to put limits on deductions for those in higher income brackets with the excuse that these people need to pay their fair share. It is very illuminating for us to sit here and discuss all of the options-from a theoretical standpoint. But managing money and planning in the real world is becoming very precarious. The value of virtually anything is determined by what someone else is willing to pay for it. Much of that can be altered very quickly with some short sighted legislation that tries to be a quick fix. My strategy has been and will continue to be to just keep as diversified as i possibly can and keep myself informed.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

DrDemento said:
5mn-I am certainly no investment expert-and certainly not a real estate expert. All i am doing is pointing out how the game has changed. What is more scary, however, is how the game might be changed in the near future. There are distinct advantages to certain investments right now(real estate being one of them) that can be taken away with the quick swipe of a pen. If they can change the full retirement age for social security benefits they can certainly screw around with any deduction on the books especially that for mortgages. And it is even easier for them to put limits on deductions for those in higher income brackets with the excuse that these people need to pay their fair share. It is very illuminating for us to sit here and discuss all of the options-from a theoretical standpoint. But managing money and planning in the real world is becoming very precarious. The value of virtually anything is determined by what someone else is willing to pay for it. Much of that can be altered very quickly with some short sighted legislation that tries to be a quick fix. My strategy has been and will continue to be to just keep as diversified as i possibly can and keep myself informed.
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Yeah. Real estate is neither affordable nor the right thing to do for many. For me, most of my life has been living in apartments. I have always put personal monitary and residential flexibility above other priorities.

FlagDUDE08 said:
You still have to contract someone to work on it, though. Governments still don't actually build stuff. They may approve an ordinance for the use of something, and in cases may request a contractor to create a postal road or provide a subsidy for some sort of infrastructure (as you had just mentioned), but they don't actually build it, and they don't always provide the subsidy. Cable on the road where I grew up is an example; currently it is not strung out there, and will not be anytime soon.
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True. The government has few skills in the execution of much of this. Nor should they as execution is where the private sector excels...better and cheaper. The point is that taxes pay for some valuable stuff. Although not perfect, the system works well.
 
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Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

5mn_Major said:
Careful. You need to compare like for like. If looking at mortgaged property to live in...then you need to compare to someone paying rent. Is rent a better deal than buying a similar prices house? In mortgages, you write off interest and pay principle. Even if repairs means youre throwing away money...its still no worse than throwing 100% of your money away on rent.

If you're looking at it as in independent investment, then you need to compare it to other independent investments such as stocks or bonds. Then you buy cheap with high return...and the income story seals the real estate deal. Appreciation, if for some reason you ever decide to sell, is icing on the cake.
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If you are comparing it to other investments, you still need to consider the time and effort that goes into actively managing the properties (or the costs of paying someone else to do so). Rental income is far from being a passive income stream that people make it out to be.

Once I buy a stock or a bond, while I have to stay informed on the company, I don't have to worry about the day-to-day operations of company. Not the case for rental properties, when that tenant calls with a major problem you have to deal with it immediately.

You still have to consider the 5-10% that you will be paying in property taxes/maintenance on any rental property, income taxes on any profit, along with the costs of having the property sit vacant for a prolonged period and the risks/headaches of dealing with tenants. One bad tenant can trash a place to the point that repairs will eat up any and all profits for quite a while.

In any case, I stand by by assertion that real estate is not a good investment until any mortgage on the property is paid off. Regardless if it is you're personal residence or a rental property.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

Almington said:
If you are comparing it to other investments, you still need to consider the time and effort that goes into actively managing the properties (or the costs of paying someone else to do so). Rental income is far from being a passive income stream that people make it out to be.

Once I buy a stock or a bond, while I have to stay informed on the company, I don't have to worry about the day-to-day operations of company. Not the case for rental properties, when that tenant calls with a major problem you have to deal with it immediately.

You still have to consider the 5-10% that you will be paying in property taxes/maintenance on any rental property, income taxes on any profit, along with the costs of having the property sit vacant for a prolonged period and the risks/headaches of dealing with tenants. One bad tenant can trash a place to the point that repairs will eat up any and all profits for quite a while.

In any case, I stand by by assertion that real estate is not a good investment until any mortgage on the property is paid off. Regardless if it is you're personal residence or a rental property.
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Very good points and summarizes how I feel extremely well also. One episode of dealing with a bad tenant-one who refuses to pay rent, destroys the property, etc is enough. Then trying to evict such a tenant is not an easy task. it is time consuming, expensive, and most of all filled with stress and tension. I am sure there is money to be made in real estate-but it is definitiely not for me. I am very happy to sit back and collect dividends. In my early years I learned how to make money by earning it and working for it. In my 13 years of semi retirement I had to learn how to make money by using money to invest.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

DrDemento said:
Very good points and summarizes how I feel extremely well also. One episode of dealing with a bad tenant-one who refuses to pay rent, destroys the property, etc is enough. Then trying to evict such a tenant is not an easy task. it is time consuming, expensive, and most of all filled with stress and tension. I am sure there is money to be made in real estate-but it is definitiely not for me. I am very happy to sit back and collect dividends. In my early years I learned how to make money by earning it and working for it. In my 13 years of semi retirement I had to learn how to make money by using money to invest.
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There's risk in every investment. I'd consider that similar to a bond defaulting or a selloff tied to a dividend cut. If I was losing money because someone kept breaking stuff or refused to pay rent, I would take them to a small claims court in the case of lack of payments (I'd try to iron the rent out as quickly as possible), or in the case of breaking stuff, I'd increase their rent rate the next time their contract is up to compensate. I do like the dividends and interest payments as well.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

FlagDUDE08 said:
There's risk in every investment. I'd consider that similar to a bond defaulting or a selloff tied to a dividend cut. If I was losing money because someone kept breaking stuff or refused to pay rent, I would take them to a small claims court in the case of lack of payments (I'd try to iron the rent out as quickly as possible), or in the case of breaking stuff, I'd increase their rent rate the next time their contract is up to compensate. I do like the dividends and interest payments as well.
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FD-Of course that makes sense but in the current world the landlord is often seen as the bad guy regardless and bad tenants can be just the worst kind of tension to live with. It is sometimes not just about the money (but of course that is a major consideration). Sometimes the worry about any investment may just not be worth it. I am one of those who tends to like to sit back and relax and also to be able to sleep at night knowing that things are probably OK. Give me a safe 6% instead of a risky 7% any time. But in this market it is getting more and more difficult to find that. Taking a look at highly rated companies-BBB+ or better by S&P-you are lucky to be able to get a bond for 2-3% or a preferred stock at 3-5%. Trying to get higher yield means looking at lower rated companies and of course with that brings increased risk. I did find a couple of reasonable preferreds yesterday and today and put some money to work at 6+% but there will be no appreciation on either purchase-just the flat dividend. The higher this market gets-the more nervous I am feeling. I just do not have the optimistic feeling that others rushing into the market seem to have. If gold continues the recent downward trend I might put a little money there-but I am just as unsure about metals right now as I am about the market in general. Thern again I may just stuff the mattress with cash and sit tight.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

DrDemento said:
FD-Of course that makes sense but in the current world the landlord is often seen as the bad guy regardless and bad tenants can be just the worst kind of tension to live with. It is sometimes not just about the money (but of course that is a major consideration). Sometimes the worry about any investment may just not be worth it. I am one of those who tends to like to sit back and relax and also to be able to sleep at night knowing that things are probably OK. Give me a safe 6% instead of a risky 7% any time. But in this market it is getting more and more difficult to find that. Taking a look at highly rated companies-BBB+ or better by S&P-you are lucky to be able to get a bond for 2-3% or a preferred stock at 3-5%. Trying to get higher yield means looking at lower rated companies and of course with that brings increased risk. I did find a couple of reasonable preferreds yesterday and today and put some money to work at 6+% but there will be no appreciation on either purchase-just the flat dividend. The higher this market gets-the more nervous I am feeling. I just do not have the optimistic feeling that others rushing into the market seem to have. If gold continues the recent downward trend I might put a little money there-but I am just as unsure about metals right now as I am about the market in general. Thern again I may just stuff the mattress with cash and sit tight.
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Every investment has its risk. Some people choose to take it, while others do not. As for the nominal level of the market, I know there are certain posters on here saying that we're find because we're in record territory, but I do remember people back in 2007 and even early 2008 talking about how the DJIA would go to 30,000. We all know what happened, though. As for gold, I'm still skeptical, and more likely to go for useful raw materials, such as iron and copper. If we see the crash of currencies, people are not going to be paying in gold, they'll be paying in ammunition.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

FlagDUDE08 said:
Every investment has its risk. Some people choose to take it, while others do not. As for the nominal level of the market, I know there are certain posters on here saying that we're find because we're in record territory, but I do remember people back in 2007 and even early 2008 talking about how the DJIA would go to 30,000. We all know what happened, though. As for gold, I'm still skeptical, and more likely to go for useful raw materials, such as iron and copper. If we see the crash of currencies, people are not going to be paying in gold, they'll be paying in ammunition.
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Of course-and we have also invested in some Colt and Smith & Wesson. ;)
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

*sniff* So proud... 50 more shares for the occasion... not to mention there was a little dip so it hit my support mark...

<iframe width="560" height="315" src="http://www.youtube.com/embed/m0CoRrY1EUo" frameborder="0" allowfullscreen></iframe>
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

Most stocks down today, yet somehow AWR (long position) is still kicking ***. I guess a raised dividend will do that.

I'm glad I grabbed this when I did.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

FlagDUDE08 said:
There's risk in every investment. I'd consider that similar to a bond defaulting or a selloff tied to a dividend cut. If I was losing money because someone kept breaking stuff or refused to pay rent, I would take them to a small claims court in the case of lack of payments (I'd try to iron the rent out as quickly as possible), or in the case of breaking stuff, I'd increase their rent rate the next time their contract is up to compensate. I do like the dividends and interest payments as well.
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When Mom & Dad moved to MA, they rented out the NJ home. Tenent #2 did not pay, and it turned out he was the son of a county judge. Try getting them evicted! Eventually he left, owing Mom (Dad had since passed) a lot of repairs and outstanding rent.
 
Re: The Stock Market thread: BUY! BUY! BUY! Sell, sell, sell...

joecct said:
When Mom & Dad moved to MA, they rented out the NJ home. Tenent #2 did not pay, and it turned out he was the son of a county judge. Try getting them evicted! Eventually he left, owing Mom (Dad had since passed) a lot of repairs and outstanding rent.
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I'd take it right to the state level and skip the county altogether. Conflict of Interest is usually a pretty good reason.

Perhaps for #2 I should make this the investments thread instead of the Stock Market thread. I'd certainly like to hear some opinions on anyone else who is trying out P2P lending.
 
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