I don't know if any of you have a 401k or retirement investment, but you might want to check on it to see how much it's declined in value.
The UK alone lost £60Billion today, which is the single largest loss in 4 years. Several points down. We also saw a £56Billion loss last week, but the market rallied slightly. All I would like to say is a big thank you to the bright sparks in these mortgage lending businesses in the United States of America who provided mortgages to clients who couldn't afford them. Then went into a panic, invested the debts abroad and thus potentially caused a worldwide recession - JUST when I thought my property value was going to increase! One analyst this morning on BBC Radio4 said (and I quote) "Nobody can predict, not even me (oh really, why are you on then?) what will happen and this could be a minor blip or a very long slump...." Great! That's that clarified. We're screwed! Hope you like your big condo now! ;-)
I think a Bear is 20% loss and we are at 10-12% so we have a 8-10% window. After that, it's kiss goodbye to profitablity, accountability and watch those little bust figures jump out the nearest window. More worrying are pensions have already gone.
True, 20% loss over the course of a year is one of the indicators of a Bear market and I don't ctually thinkk we'll be seeing one but how often does one get to say "beware the bear market"? If only I had said Hazzar!, that's an all tooforgotten word. Mind you, maybe I should have, property prices here in N. London need to drop down a jot if I am to get a property to the spec I want without having to kill a family/claim squatters rights. Lives in 2nd most expensive part of London after Mayfair :-(
My girlfriend's 401k is actually going up. I keep hearing on the news how mortgage lenders are bumping up their loan requirements and are having credit troubles of their own because of many people defaulting on their sub prime home loans.
Korean stock market closed early to prevent more loss. People are saying today will be Black Friday all over again... Just hope not many people will jump off bridges this time... -__-;;
Well the question is will the sub-prime market recover (sub prime means a unreliable or risky person to loan money to, usually at a high rate) Right now 1 in 256 us homes is in default, in some areas 1 in 69. These people can't pay their bills, so it's a good time to buy a house to LIVE IN but not as an investment. A house is a liability not an investment. Say you rent instwad of buy, all the money saved + property taxes you never pay can equal up to a million bucks compounded by the time you retire. US is obsessed with owning a home, this is unusual in the world. Home ownership in most european countries is around 20%... Basically no new homes = economic slowdown. Combine with the new crackdown on illegals and you might see a sizable chunk of the 14 million illegals leave. That or a giant crime wave.
If you're under the age of 40 (or even 50) you shouldn't worry about it. Any good 401k plan is going to be situated around your age. (Heavy stock as you're young, slowly change to bond-centric as you age). Obviously, the market can't always go up. Just be glad you're young. If you actually live off of money you make in the market... well... you better go buy some ramen. When? I can confirm Kospi 200 index was trading the full day yesterday (and is open right now). If any market is not going to close, it's the Korean one. Those fuckers want to be open all the time.
Correction. There was unconfirmed news of this one on last night news bulletin. As usual our network seems got the facts little bit mixed up.... -__-;; In either way a lot of people in Korea will lose out BIG time... phew~~
Yeah, it is part of the "American Dream," that's for sure. But there's also been a (traditionally) good reason for it though. Owning a home and building up equity is one of the few ways for normal people to be able to accumulate wealth, to pass onto one's children. In fact, you could make the arguement that home ownership is one of the measurements of a healthy economy. Back in 1999 I had a friend who went to school to become a web desginer - then the tech bubble burst. Two years ago the same guy got his realator's liscence. I feel bad for the guy.
No better way to fuck your kids in Japan than to own a nice chunk of property when you die. The death tax here is pretty much the same as the US (free up to about $400k) but the land prices are so fucking stupid they usually result in the kids having to sell the land to pay the taxes. There are only a few parts in the US where the average house would be over $400k (Cali, Hawaii, NY -- even in suburbs).
This isn't always the case - since you can claim mortgage interest back against your annual tax liability in the US, you can end up saving money per year, even after property taxes. As ever, a lot depends on how much you borrow, which end of the property valuation bubble you buy in & how bad the property taxes are in your neck of the woods. Provided you don't over commit your finances & pay some attention to value trends, it can work better than renting, where you definitately won't end up with an asset at the end. When I was looking at mortgages a few years back, lenders were offering me fairly insane amounts of money - I actually found my own comfort threshold about how much I could pay each month & still have money for food/toys was quite lower than theirs - and I suspect that is part of the problem that's giving the markets the willy's right now. I'm out of touch now, but I reckon UK home ownership (well, at least mortgage ownership) has been fairly high for ages, certainly since Maggie Thatcher encouraged all the local councils in the UK to flog off their public rent stock... The one thing to remember with all investments, but especially the stock markets, is that there's an element of risk - never keep all your eggs in one place, be prepared to ride some storms & always keep some funds someplace easy to get at (building society/credit union accounts etc). And don't rely on just your state/company pension to keep you going later either...
