But wasn’t it the derivatives on Wall Street that actually fueled these risky lending practices?

When his Dad retires, his income will be derived from his pension and/or 401k plus social security.

I am college educated, I have experience in building, as I was a lead OCIP administrator in my last job, so I understand the insurance end, and I used to document derivatives in the past as well.

In the US the short version of the tax code is, "income, from whatever source derived, is taxable".all cash

I have a 10 year trading background in financial derivatives, mostly options arbitrage and structured commodity deals.As a trader it is clear that it is much better to buy a stock (real estate) in a rising market than in a falling market.

The big risk with any "derivative" instrument (options, futures, etc.) is that things may not go like you planned over the time frame that the option covers (development goes slower than planned, you can't find a buyer, etc.).

A part of it also depends on your own experience.If you are knowledgeable about tenant relations, property maintenance, lease negotiations and tenant improvements; AND you are local to where your investment is, then you could consider managing it yourself.I have known many an investor who derive great pleasure out of taking care of their own properties.

I derive this number by assuming I could rent the place for $1,100.

We have just begun to see the losses my friend.Flipper, I traded on the floor of the LIFFE exchange arbed options, traded cross currency options, went on to do structures commodity products and trade energy derivatives.

Another question I have is in today's world does buying based on prices derived from the 50% calculations allow one to buy at valuations which will allow for refinancing in the short-run?