All Forum Posts by: Canesha Edwards

@Matt Groth

That’s a good way to put it. I guess the bigger problem is the eroding dollar and not the real estate market itself. The supply and labor shortages definitely have amplified the problem.

@Nick Barlow

Great perspective here.

Econ classes teach that once countries reach around 70-80% debt vs GDP there should be reason for concern.

U.S debt is currently around 137% of GDP. So, we should have all been concerned for a very long time- prior to the pandemic. Over government has put us in a situation where as a country, we’re screwed either way. The past and previous administrations have never really cared to get debt under control. This became more obvious with each new raising of the debt ceiling.

Looks like the only options we have are either raise rates and default or print more money and further devalue the dollar. Oh and fun fact- the largest holder of US debt ( treasuries) is the Social Security Trust Fund. Social security tax revenue by law has to be invested in guess what- US treasuries. Oh what a twisted web of government activity.

Im shirking my cash positions, but I’m not desperate enough to invest in any 3% cap deals.

@Gary L Wallman

You’re right. Today’s numbers are far worse when actually put in perspective with other time periods.

Two key words that you mentioned.

Manipulation and Devaluation.

Silent killers to the American economy.

How are you hedging against the devaluation of the dollar? Are you solely putting money into real estate and commodities?

@Christopher B.

Restructuring would mean admitting that there is a problem and taking accountability for the gross mismanagement of the American economy. We’re not going to get that from our government.

@David Dachtera

100% agree with you. It will take a few years to ramp up construction to the level needed to address the supply issue.

@Christopher B.

Let me reword my statement. The way in which QE was conducted, the amount which was given and the duration of the program was a bad move.

How does it make sense to hand over money to the same people who mishandled it in the first place? There were not enough restrictions in place and the real problem was not enough of the corporate people in charge were punished. I most certainly would have let more institutions fail. If the Fed wanted to be of such help, give stimulus to the people’s who’s retirement was wiped out. Provide stimulus to the employees who lost jobs. But bailing out the corporations with a slap on the wrist was the wrong move. The only lesson learned here was that you’ll get off pretty easy. The government should have treated corporate America with tough love instead of enabling them. As we’ve seen with the pandemic the government has the means to prop up the economy. If the public loses confidence in the banks, maybe that will force banks to get it together.

These corporate executives didn’t experience any negative impacts personally when compared to the average person who’s retirement was squandered away at no fault of their own.

Here’s a better question? How did QE make the financial system a better Stewart of the public’s money? Or did it just open the door for future negligence due to lack of consequences?

@Christopher B.

You will not get push back on this. More Americans are definitely spenders than savers. Mostly part of the problem. However, you can not negate the fact that inflation will be a problem for the every day individual trying to get ahead. Now, don’t get me wrong, the are some people living a very lavish life on a paper thin financial statement and government stimulus. Those people will not have my sympathy when the water runs dry. Everyone is not like that though and some people honestly can’t make ends meet and forget about saving, with increasingly higher prices. Realistically, how much is $16/hr in today’s dollar.

As for the investors chasing after returns, I wish them all the best. To me, this is like playing the lottery, it’s speculative from the beginning.

I do question your production comment. Production is strong in what regard? Nominal or real gdp? With the current inflationary environment, of course we’re producing a lot, the price increases reach new highs every month. We also have to acknowledge the fact that we have a terrible supply problem partly because nothing is produced state side anymore. Yeah we can talk labor shortages, etc but our largest companies have spent time building the logistical infrastructure and training workers overseas. We’re actually behind infrastructure wise in the states.

The US debt and the so called debt ceiling is a joke. In theory we could wipe out our debt, being that it’s just paper. But what are the repercussions?

There are a million factors, indicators, predictions we could all make. While it makes for great conversation, sadly that’s all it is. The key to investing is buying right regardless of the current market trends. I truly believe when real estate is “popular “ it’s a time to be cautious. I am certain a correction will come. It could be next week or another 10 years from now. Nobody knows. What I do know is my investment strategy is the same regardless.

@Zachary Beach

@Zachary Beach

That’s a different perspective. Here’s my take.

I don’t think there was a correction in real estate prices.Now, the stock market definitely saw a correction, but the Atlanta market has been on a constant up trend.

We “May” see a small hike in rates and I use that term lightly. I don’t think the Fed will raise rates to a substantial level and I don’t think the Fed will keep rates higher for long.

If that is the case, that leaves us with higher inflation on a more permanent basis. Which would make the case for this being the bottom of a market cycle. Jerome Powell already basically acknowledged this. Meaning that more people are being priced out of owning a home, maiming three renters, and current renters will become even more financially burdened.

The gov’t stimulus did two things.

1. It provided a short term life line to households who would have been homeless otherwise, but it didn’t solve the problem of American households being financially burdened. Now, factor in the fact that majority of gov’t stimulus was spent on trips, cars, shopping sprees, etc- one can’t really that the American people are in great shape.

2. It provided cheap credit to the wealthy and corporations. Allowing them to take more risk.

All the cheap credit flooding the market has inflated prices, but let’s consider who really suffers from inflation. It’s the middle and lower class. As a billionaire I’m not too worried if my $1 can now only buy $0.85 worth of goods. I have a billion of them!! However, for the starter family who only makes $80,000k a year with two kids, well; now you’re starting to have problems. If this continues , the Fed won’t have to raise rates because the money supply will contract simply because the lower class income will all be spent on life necessities. Discretionary income will only be associated with the wealthy.

Have you noticed how the “new” investment strategy is build to rent? The US is in need of a million plus homes, yet the new thing is build to rent. We’re heading towards a more prominent renter nation, who will more than likely be heavily dependent on some sort of assistance.

Personally, I don’t see how the market can handle the current situation let alone continued increasing prices. 2020 saw the largest transfer of wealth from the middle lower class to the wealthy.

I love the different perspective on this. It provokes me to look at different alternatives. My analysis is based on historical events, but to your point we could be in a situation where the Fed does the opposite of what history says we should do. Definitely Something to sit and ponder on.

@Bud Gaffney

Interesting. Please elaborate further.

@Tim W.

I agree with you. My personal residence has doubled in value here in Atlanta. I question the value because the area hasn’t changed fundamentally. I can not give one account of what real value has been added to the area to account for the dramatic price increase. The school system has not improved and is kind of on the lower end of the spectrum. There are not any new developments to bring much needed food and entertainment options. Yet, the price of the house has doubled. Ming blowing.

I am happy for a few of my neighbors who sold a walked away with $100k+ checks.