Open House Picks: Six Months Later

McKenzie – I get your point, but it is so vague and general as to come off as pollyannish. To say that pessimists “are correct every so often” is a huge understatement. And mind you, I would not frame it as optimists vs. pessimists but rather realism vs. irrationality. How is it pessimistic to project a nice, steady rate of growth of say, 5-7%? That would be sustainable in RE, not “pessimistic”. But the bulls who thought it made perfect sense for RE to double and triple in short periods were not “optimists” – they were irrational, as it is now painfully clear that the values had lost all touch with reality and thus collapsed.

Realists accomplish a lot too – arguably more in the long run than you what you call “optimists”, since they attempt to build their accomplishments on solid foundations, not on the sand of a ponzi scheme.

ms. muffett, i hear what you are saying, but so many successful projects could have been described as irrational at first by pessimists. the dichotomy exists between those that look down and those that look up. That is not to say that pessimists cannot be right, they are correct every so often, but what do they accomplich with their pessimism?
on the other hand the optimists accomplish a lot. The Brooklyn Bridge was not built by a pessimist. The Dutch settlers on the edge of a scary wilderness did not think they would pay less for manhattan if they waited a couple of more months. I mean most things that have moved us forward as a civilization could have been described as really demented at the time. How about building a giant female made of copper in the middle of the harbor on top of an old fort?

I’m missing your point, Whuh. If I berated you it wasn’t for something similar to what you just posted. You’ve posted some real crap at times.

I for one never said that real estate prices will always go up. In fact I continue to believe that the market will remain soft. However, like most of the bears, you cling to the 40% overpriced logic that is groundless. Others are in the 50-70% camp.

I never said the stock market was entirely rational. I do believe though that it is the leading indictor for sentiment and where the economy will go. Right now, that direction is upwards and I’m happy to be very long the market until I feel that greed has overtaken once again. In fact, I’m very nervous about it right now given the runup off of the bottom. We hold both long and short positions and the portfolio can be net short one day and net long two days later.

No contrition from me…I’m just in the market to make money. I DO NOT trade the real estate market like that. Nor do I believe anyone else should. I have however made lots of money in properties that I’ve held since the 90s and continue to hold.

My biggest gripe here is with the people that really don’t understan the very long term attractiveness of real estate and the extremely long term benefits to owning over renting as you approach retirement.

I think whuh does not realize that american capitalism is founded on optimism. that is the default mode. even fdr once famously admonished his countrymen telling them that what they had most to fear was fear itself, in other words, negativism, pessimism, defeatism.

As someone whose been on both sides of this –I’ve been a jerk to, and been berated by DIBS –one thought as to how he became a lightning rod. First, there is a double standard in finance, financial journalism, and policy that is reflected on the board: i.e., a bubble years bias in favor of bullishness, as nearly always an entirely rational expression of the stock market’s pricing power, and a bias against bearishness, as panic, doom saying, chicken little, etc. When the bulls started losing out to the facts, sure enough, much of the discussion suddenly shifted to the life-negating jaundice of the bears. How about, instead of insinuating that I’ll never savor the good life because I refuse to fork over 3 million for a house, a tiny bit of contrition on the part of people who told us RE always goes up?

Dave is talking about missing out on the latest move in stocks; ok, it’s possible a new bull market is underway; it’s also possible it’s a sucker’s rally. But I’d like to point out that I sold a huge portion of my equity portfolio when the DOW was above 12,000; and by the same prudence, am uninterested in townhouses that still seem overpriced by 40% at least.

Now, what in the above suggests I’m a fool an idiot, a stockboy at Target, etc etc? And yet this is what DIBS insists on calling me. And yet the bulls let this pass, while leaping all over What, cornerbodega, etc.