Thursday, January 31, 2008

Don't underestimate the power of the FED


As I stated earlier, the low for the next few weeks/months was set in the gap down on Tuesday.

When the FED starts cutting rates you have to buy buy buy on the stockmarket. The FED is able to flood the market (and companies) with money / liquidity.

Never underestimate the power of the FED. When they cut interest rates with 75 basis points that Monday, stocks should be BOUGHT not sold. That was a clear "AL GO' buy signal.

People that were selling back then, shouldn't be investing in the stockmarket. They should try to play some video games and have a savings account.

UFC 81

2 Interesting matches this week-end at UFC 81.
Sylvia - Nogueira (match for the heavy-weight title )

Mir - Lesnar


Offer


Meeting scheduled this Saturday at 11AM. Negotiations about price, options and timeframe.

Signing of a contract is possible.


Watch out for falling knives...

Political science

DEMOCRATIC
You have two cows.
Your neighbor has none.
You feel guilty for being successful.
Bruce Springsteen and U2 sing for you.

REPUBLICAN
You have two cows.
Your neighbor has none.
So? If they want a cow, they should get a job.

SOCIALIST
You have two cows.
The government takes one and gives it to your neighbor.
You form a cooperative to tell him how to manage his cow.

COMMUNIST
You have two cows.
The government seizes both and provides you with milk.
You have to wait in line for hours to get it.
It tastes like ass and is very expensive.

CAPITALISM (AMERICAN STYLE)
You have two cows.
You sell one, buy a bull, and make a fucking herd of cows.

BUREAUCRACY (AMERICAN STYLE)
You have two cows.
Under the new farm program, the government pays you to shoot one, milk the other, and then pours all the milk down the drain.

AMERICAN CORPORATION
You have two cows.
You sell one, lease it back to yourself and do an IPO on the 2nd one.
You force the two cows to produce the milk of four cows.
You are surprised when one cow drops dead.
You spin an announcement to the analysts stating you "have downsized and are reducing expenses."
Your stock price increases.

FRENCH CORPORATION
You have two cows.
You go on strike because you want three cows.
You go to lunch and drink wine.
Life is good, eh?

JAPANESE CORPORATION
You have two cows.
You redesign them so they are one-tenth the size of an ordinary cow and produce twenty times the milk.
They learn to travel on unbelievably fast, crowded trains and to play piano and violin.
All the cows are at the top of their class in cow college.

GERMAN CORPORATION
You have two cows.
You engineer them so they are all blond, drink lots of beer, give excellent milk, and run a hundred miles an hour.
Unfortunately, they also demand 13 weeks of vacation per year (and watch really weird porn).

ITALIAN CORPORATION
You have two cows, but you don't know where they are.
While lazily looking around, you see three drop-dead beautiful women.
You break for lunch.
Life is good, eh?

RUSSIAN CORPORATION
You have two cows.
You drink some vodka.
You count them and learn you have five cows?
You drink more vodka.
You count them again, and this time there are 24 cows, and they won't hold still.
As you continue to drink vodka, the Russian mafia shows up and steals whatever cows you may have had.

TALIBAN CORPORATION
You have all the cows in Afghanistan, which comes to two.
You don't drink the milk, because you cannot touch any of the cow's private parts.
You get a $40 million grant from the US government to find alternatives to milk production, which you use to buy AK-47's.

IRAQI CORPORATION
You have two cows.
They go into hiding.
Periodically, they send tapes of themselves mooing.

BELGIAN CORPORATION
You have one cow.
The cow is schizophrenic.
Sometimes the cow thinks he's French. Other times, he's Flemish.
The Flemish cow won't share with the French cow.
The French cow wants control of the Flemish cow's milk.
The cow is now asking to be cut in half.
The cow dies happy.

FLORIDA CORPORATION
You have a black cow and a brown cow.
Everyone votes for the best-looking cow.
Some of the people who actually like the brown one best accidentally vote for the black one.
Some people vote for both.
Some people vote for neither.
Some people can't figure out how to vote at all.
Finally, a bunch of guys from out-of-state tell you which one you think is the best-looking cow.

CALIFORNIA CORPORATION
You have millions and millions of cows.
They make real California Cheese.
Only five can speak English, however.
The best-producing cows are illegal.
Oh, yeah, and Arnold likes the ones with the big udders.

Wednesday, January 30, 2008

How is our offer doing?


It's not "common" to negotiate on the price of a NEW to build home. In a normal market, the price of the builder is the END price. However we are in a different kind of situation right now. Builders want to unload as many homes as possible to have positive cashflow. Liquidity problems are widespread with the builders.

Our offer was sent to the boss of the local salesperson.

The offer was sent by our realtor. This was the response of our realtor:

"What kind of upgraded appliance package are you looking for, the builder wants to know?"

So that looks good, for now.

I can assure you we didn't ask for peanuts. I won't post the amount here but it is SIGNIFICANT as is the price reduction. The front deck (terras) is standard, the deck near the water is an option we requested. Time will tell...

MadMan is doing it again (State of the Union)

State of the Union:
You would expect an apology for the depressed economy, for the 4000 US soldiers killed in Iraq, for all the money wasted away in wars around the world, ...
You would expect it would contain something like this:
Dear fellow Americans, I am really sorry. When I lied to you about "weapons" of mass destruction in Iraq, I wanted to do well and conserve our oil interests. Oil was $27 dollars a barrel that time, now it is over $90. My advisors told me that a war would help our oil supply but something very unusual happened. The price of oil went up, can you imagine that? Who would have thought that would happen? ...

But no, mister "madman", mister "puppet on a string of the oil companies", mister "dumb and dumber" talks crap. If any of the Americans believe this BS they DESERVE to loose their house and job. Maybe they can vote for him again...
"Let us create a new, international clean-technology fund, which will help developing nations like India and China make greater use of clean energy sources. "
President Bush said his foreign policy is "based on a clear premise: We trust that people, when given the chance, will choose a future of freedom and peace."
"We share a common goal: making health care more affordable and accessible for all Americans."
What country is he talking about?

Tuesday, January 29, 2008

Superbowl

This Sunday the Superbowl is held in Glendale, Arizona. (suburb of Phoenix)
It can be compared to the final of the World Cup for us, Europeans.

Giuliani withdraws from the GOP race

and he backs up the Bush-clone McCain. If McCain wins the Republican nomination, it is 99% certain that a democrat will win.

We made an offer

on a (new to build) house on the lakes with the biggest SOUTH oriented lot.


We made an offer where we asked for some "free" upgrades. We hope it will be accepted or that we are allowed to negotiate.

Buyers are very hard to find, builders have a difficult time (especially in Arizona) and have some cashflow issues. We want to take advantage of that.

It will probably be the most expensive house that will be build in Maricopa in 2008 (the start of the post bubble era). Which from an investor standpoint of view is not such a good move. You'd rather want to own a low-class home in a fancy neighbourhood instead of an upscale home in a low-class neighbourhood. The high price is caused by the high premium of the lot. Americans don't want to pay extra for land. We are Belgians, we don't mind. Land prices in Belgium are (change that to "were" for the foreseeable future) extremely expensive and for that $225 / m2 lot you have a view on a "Discount Profi"...

Prices in Maricopa have dropped 40% the last 18 months and are at 2003/2004 levels. Half of Maricopa is for sale right now .. and the other half is auctioned off :-)

I remember in 2004-2005 hundreds of homes sold each month ... link

Will it go lower? Probably, but we will pay a price that is reasonable, with a low interest rate and on the dreamlot we have always wanted.

If we are able to buy the home, we will not visit Belgium this summer. We'll be busy moving. Our lease ends at the end of June.

The builder of our rental home just went bankrupt ... LINK

Holy cow: Countrywide: 1 in 3 subprime mortgages delinquent

Countrywide Financial Corp, the largest U.S. mortgage lender, on Tuesday said more than one in three subprime mortgages were delinquent at year-end in the $1.48 billion portfolio of home loans it services.

That's what I would call "tight" lending standards ...

Monday, January 28, 2008

I am really glad I will see those people filling shelves at walmart for $6.75 an hour

This just redefines the phrase " good job"

The CEO of KB Homes (homebuilder) receives a $6 million dollar bonus while the company lost 1 billion dollars in 2007 ...
Here is the link.
Assume the company lost 2 billion in 2008, would he receive a $12 million dollar bonus?

Picture of the day

In the worst housing market ever (except 1929)

there is a good chance we'll make an offer for a home during the next week(s).


Maricopa housing statistics:
Graphs: (yellow = price / sq ft)We would be buying into the abyss, which is pretty scary...

Sunday, January 27, 2008

Lisa's math exam went well

Result within 4 weeks.

Valentine

Companies / businesses finally won, I don't want anymore discussions on Valentine. I bought my Valentine present for Lisa early!

Saturday, January 26, 2008

Rebates to stimulate the economy (update)

Our share is $1500 :-)
(2 * 600) + 300 (per child)

America land of opportunities (and tax refunds)
"The idea is to target the money on the people who will spend a large share of it, and to target it on people who are likely to be hurt by an economic downturn."
You would think they would "target" people who would SAVE it to prevent disasters like this one but no: the government gives you money so GO AND SPEND IT!

Cartoon of the day


Question of the day?

After getting $20 000 000 000 from their investors to complete the worst timed take-over (ABN-Amro). They paid 21 times earnings 6 months ago, while most banks are quoted for 6-10 times earnings today.
Can/Will the biggest Belgian financial institution go bankrupt?

The first visitor(s) will leave tomorrow

They will arrive in San Francisco and depart 10 days later in Las Vegas. They will be here during the week-end of the 2nd and 3rd of February. We wish them a safe and sound trip.

I asked them to bring 12 KWATTA choco paste bowls
and 8 KWATTA MICE "shit" boxes.That is literally translated :-0

Great MINDS think alike

Peter Schiff Named Economic Advisor to the Ron Paul 2008 Presidential Campaign



"I know, sounds crazy" (at 22 seconds of this movie) was ironnically intended...


LINK: Housingtracker Phoenix

LINK: housingtracker California (San Francisco)

LINK: housingtracker Florida (Miami)

Friday, January 25, 2008

This is a CHURCH my GOD!

Lisa has a MATH exam tomorrow

She took a day off this Friday to prepare for the exam. So she still has 10 "sick"days left that she can use whenever she sees fit. And it accumulates, so next year those days will be added with the new set of 11 paid leave days ...
For now keep those fingers crossed.

Nouriel Roubini invents a new economy term

I love it!

What is a housingcrash?

Let's assume ... you want to live in Verrado (the little place we went to last week-end). You like the homes from Cachet homes (upscale homebuilder). You buy this model : Willow. (click on elevation to see the home) You pay $ 550 000 + $200 000 in options for a total "boom" price of $750 000.
Half a year later you take a look at what the builder is offering and you see their price sheet.
You take a look at the new price: $579 000 ...
... you think that is a housingcrash, guess again this is:

The homes are AUCTIONED OFF with a starting bid of 315 000 / 335 000 ... You lost 400 000 in equity in your home in 1 year. That is a housingcrash and there is a chance that no one wants these homes at these prices.

The new trend: The foreclosure bus tour ;-)

NOTE: If someone pays 750 000 dollar for a 250 000 dollar home in 2004, paying 369000 in 2008 is not a good idea. But there are bargains out there.

Thursday, January 24, 2008

$1200


We will receive a $1200 check from the US government. Thank you housingmarket and bubble buyers!

Important archaelogical discovery

After the "Peking Man" another important find in Asia: LINK

Now that I teach world studies ...

Spiders on drugs

Life after death

It has been a while since I bought a non-investment/gambling related book.

Well I have done it again: 90 Minutes in Heaven: A True Story of Death & Life
The author was in a car crash and was declared dead for 90 minutes. He explains what he "saw" during those 90 minutes.
It is not a very objective story because the storyteller is a baptist priest :-) But it was the closest I could find in solving the big mystery/miserie of "live after death".

Tuesday, January 22, 2008

1929 revisited


So when will the first mortgage brokers commit suicide? Oops


So when will the first realtors be sued? Oops


So when will the first 6% realtor be shot by one of his clients? Oops

- 2000 points in the blink of an eye

Booyah

A MUST see, really. And I mean REALLY !

LINK 18 Jan 2008

Jim Cramer was the only one (excl Peter Schiff) that was telling that the MESS was really BAD.

He talks about a 2000 point drop in the DOW if the insurers go belly up and that can happen in days.

He asks for a 100 basis point rate cut (Jan 18), Monday 22 Jan the FED cuts 75 points, looks like someone was listening after all.

Question of the day


After:

Bush Sr. 1989-1993 (fact)

Clinton 1993-2001 (fact)

Bush Jr. 2001-2009 (I still hope I will wake up from this nightmare)

Clinton 2009-2017 ( a possibility, 50%)


What are the chances that the Americans elect Laura Bush in the 2017 elections?

Heath Ledger has died

We liked his flamboyant presence.

Chinese stockmarket

That is a 35% drop in 10 weeks for the Chinese stockmarket:

For US stocks: With the FED on the side of the market, the time to sell stocks is over.

BUY BUY BUY

The low for the next few weeks, months was set this morning when the DOW gapped down 400+

The dollar ... that is another story. The FED is REALLY going to f* up the US currency.

What does a 75 basis point cut mean?

1. They overdid it on the upside (17 consecutive rate hikes...)

2. The mess has become an apocalypse / abyss / catastrophy the last few days/weeks (banks)

3. They don't have any clue. Everyone with a basic 101 Econ knowledge knew that the mortgage mess was going to hurt the economy in a big way. The only people that were not aware of the problem... the FEDeral Reserve.

4. They don't care about the value of the dollar.

NOTE: They lowered the FED discount rate which is the rate banks can borrow money overnight from the FED. Mortgage rates are not lower now, they can even rise when short term rates drop.

THIS WILL BE A TOTAL MESS

when the dust settles...

FED lowers interest rates with 75 (SEVENTY FIVE) basis points.

The "Plunge protection team" in action.

That means it is total chaos out there.
For now it means buy buy buy on the stockmarket. A lot of support DOW 11700, and immense support at 10700. That would be a great number to buy the Dow, those companies have gone through different down cycles so they are the ones who know how to handle it.

GOLD $1000 anyone?
GOLD $2000 anyone?

Monday, January 21, 2008

Best Duets ever







Me thinks, Elton John is an excellent duet-singer:-)

Question of the day

Well,

"American re-electers of Bush",

you are going to loose your job, the dollar has collapsed and a piece of toilet paper is worth more, oil is at $90 a barrel, gold is at $875, your home is worth less every minute, ... are you happy now?
Didn't you see it coming?

Ron Paul takes 2nd place in Nevada caucus

Maybe we should move over there :-) No state tax and sane people.
NO media support and taking 2nd place in an American caucus, that is an incredible result.

Holy Cow, PANIC in the streets

The BEL20 drops 5%.
Apparently those steep rises don't last forever ... see article "These things end badly most of the time..."
A lot of support at 3500, a little bit at 3000 and at 2500 there is very heavy support.
If we are heading for a recession we ( as a consumer) have the advantage that oil will get cheaper :-)
We won't have any work to drive to ... but gas will be cheaper.
Time to put some quality European stocks on the radar/watchlist that become cheaper by the minute:
Agfa-Gevaert
Option
Dexia
Omega Pharma
TomTom
From Euphoria to total panic in less than 6 months, I thought everybody was aware of the mortgage meltdown in the USA...
This will become a severe problem in Europe, price drops in real estate of at least 30% seem very logical.(more for Spain, Russia and the United Kingdom)

Sunday, January 20, 2008

Pics

Our male cat has taken my place in our household...
Our cats are great!
Lisa has an exam coming up this Saturday.(26th)

I thought this was appropriate

Quote of the day

Mediocrity knows nothing higher than itself, but talent instantly recognizes genius.
Sir Arthur Conan Doyle (1859 - 1930)

Verrado

Yesterday we crossed Phoenix from East to West.
We encountered this "European" like VERY upscale city/community: VERRADO which is located in Buckeye. It is a community build from the ground up. They choose a 8800 acre location and started building... (1 acre = 4000m2)

Friday, January 18, 2008

Thursday, January 17, 2008

We're still alive and well

BUT were very busy ... we were thinking of buying a home.
3800 sq ft: $285 000 ($80 / sq ft)
PIC FRONTPIC BACK
PIC LOT 1250m2 (from left to right)
LOT premium $65000
PIC LOT 2
We both think the home is overpriced if you compare it to other homes in Maricopa and knowing that the foreclose tsunami has still has to come in 2008.
How low can prices fall in Maricopa? Well that is a 3900sq ft house for $187 000... that is less than $45 / sq ft

Tuesday, January 15, 2008

Republican elections

So far:
1. Romney 103,755 30%
2. McCain 102,361 29%
3. Huckabee 66,876 19%
4. Paul 29,648 9%
5. Giuliani 24,151 7%
6. Thompson 18,712 5%

Sunday, January 13, 2008

Birthday Party Pics







Real Estate round-up

Desperation!


Rank Real Estate Market 2008 Forecast
1. Miami, FL − 15.2%
2. Las Vegas, NV − 14.6%
3. Detroit, MI − 13.6%
4. Phoenix, AZ − 13.2%
5. Naples, FL − 13.2%
6. Anaheim , CA − 12.9%
7. Los Angeles, CA − 12.8%
8. Palm Beach, FL − 12.4%
9. Atlanta, GA − 12.3%
10. Boston, MA − 11.7%

Bank of America buys Countrywide Financial


FREEFALL

This is hilarious

Thursday, January 10, 2008

Memories

Carolientje


De Familie Knots


Bert en Ernie


Meester hij begint weer

Lisa is missing her friends

I wonder why ... here a movie from one of her friends:


Den Charlie lijkt me wel nen plezante te zijn LOL.

It's been a while since I laughed that hard. Hilarious clip.

Tuesday, January 8, 2008

Misc. / Varia


In less then 4 weeks we will receive our first guest(s)

In less then 5 months we will be back in Belgium for a month (June08)

Did you know that:
-at Naomi's school 2nd graders learn 30 new words every week. (in other schools in Maricopa 2nd graders learn 12 words / week)

-in the USA, cars cun make a right turn when the traffic light is red

-they hired 5 new teachers to start in January

-they hired 2 extra full-time security personnel, which makes a total of 5 (1police officer who is on campus the whole school day and 4 security personnel)

-the weather is about 20 C during the day

-our next holiday is January 21st (Martin Luther King day)

-schools don't have an Easter holiday, however we do have spring break: March 17-21

-I received my first table tennis rating: 1853, record 7W -3L, 14th of PTTC, 47th in Arizona, year-end goal is 1925, 8th PTTC, 25th Arizona

Sunday, January 6, 2008

Cartoon of the day

www.vrtnieuws.net morphs into the

UGLIEST website on the internet.


This is the worst "upgrade/make-over" EVER.

http://www.vrtnieuws.net/

This is the most visited website worldwide. Simplicity!

Introducing zillow.com


On zillow.com you can find real estate information on any house you want.

Click on www.zillow.com and type any address you want. You can even find the last selling price, property taxes, an estimate of the home's value, ...

This is part of our information sheet. Auch, the landlord pays 4400 dollar in property taxes. That's gotta hurt.