Big Al and Marshall Berol discuss resource investing in the current market.
Click download link to listen on this device: Download Show
Bobby….thanks for the post…..housing continues to go south….(down)…
btw….still a lot of units in south florida….more bankruptcy and foreclosures coming…
Don’t know much about Florida first hand, In the Box, but I believe you are correct.
Big Al
Mr. Al,
New home sales were up 3.3% in April so supposedly there is a recovery in housing.
This may last for a few more months or even several.
But after that look for another economic collapse that will take down everything and real estate will get pummelled.
Also, I am new to this site and don’t understand why you refer to this man as “In the Box. ”
Is he stuck with an underwater mortgate?
Carlos
CARLOS,,,
You should check our the CASE-SCHILLER REPORT….
New home sales,,,are not an accurate indication of the total picture of the total sales and the indication of a recovery……The numbers are from a historically 49 year low,
there were only 144,000 new units build, compared to 2 million during the last decade,
Do not get mislead by a 3.3 % or any increase…..in new units…
The over all nation wide….still needs to factor in more inventory to be dumped on the market by the coming glut of FORECLOSED OR TO BE FORECLOSED INVENTORY, THAT THE BIG BANKS ARE HOLDING…..(of those people who have not paid for the last 18 months)…of which there are about 2.9 million to come….
So A RECOVERY NATION WIDE IS NOT LOOKING TO GOOD…..
REAL ESTATE IS MY BACKGROUND….since 1971….so take it for what it is worth…about 50 cents……
OOTB JERRY
CARLO…..in the box , out of the box….is a handle…..OOTB (OUT OF THE BOX)
Oh….I have not had a mortgage since 1986….and own all my properties free and clear….as it says in the bible…”GO AND OWN NO MAN…”
and I do not have any car payments and stay clear of debt and interest payments….
And as I said , my background is real estate, and that is the biggest burden of all debt, and to have shelter free and clear is refreshing to say the least, it allows you the freedom of taking advantage of the current trend in investing which is PM( precious metals) gold , silver, platinum, or mining stocks…..PM, IS THE SECTOR YOU WANT TO BE IN NOW.NOT REAL ESTATE…..UNLESS YOU HAVE DEEP POCKETS…
BTW….glad to have you at the site……..we welcome you…..
O^OTB….Jerry…
Actually Carlos,
That is more of a joke than anything else.
Jerry very bright; offers some valuable insights; and, has become a friend.
Thanks for joining us!
Big Al
Welcome Carlos.
Jerry is an old real estate professional. But, at times he’s a little off the rocker, so they had to lock him up in a box. Occasionally he escapes, and when he does, posts comments here on Al’s website.
Though I’m not a real estate pro like Jerry, I have a license her in Arizona and have looked at the statistics from the National Association of Realtors (NAR), and follow the Case-Shiller Report Jerry mentions. There’s certainly no doubt in my mind, the NAR figures are too optimistic, as they look at very local trends, and often don’t make sense when comparing one geographic area to another.
Thank you all for your responses.
I have heard of but never really checked out Case-Schller but will. I don’t know alot about real estate but I do feel the media has put a much too positive spin on it.
I have a very bad feeling that we will face an economic downturn worse than 2008 within a year, maybe two at the most.
Jerry, i agree south Florida’s inventory is still high and prices need to come down. lack of jobs and boomers able to buy second homes are the main reason for the glut. The South Americans and Canadians are the only ones buying in numbers.
Hi Bobby,
I would guess, from what I have seen, that foreigners are picking up most of the inventory in areas like Florida; Arizona and the Palm Springs areas.
Glad someone has the financial ability to pick them up.
Big Al
Gentlemen,
Real estate is about 40 cents to 50 cents on the dollar where we live and has not budged upward. That is why we purchased a couple of properties.
As I have said countless times in the past, we did not purchased these properties to make profits. We purchased them because we live comfortably in one and rent out the other one.
Our motive was to leave a couple of great properties to our children and their families. So you can see that our time horizon on much longer than that of most.
Best to all,
Big Al
AL,,,I agree with you ,,,the one thing people forget, is real estate(single family home) is shelter first,then it might become an investment, subject to how it is treated…,but,
people forget, that there is inflation of real estate, and sometimes does not go up at the same rate as other investments.,but, we can cover that at another time….
I MUST NOW REENTER MY BOX……TIME IS UP….
Thanks Bobby!
Big Al
RE GOLD:
Short term, i doubt anyone can pick a bottom or a direction.
As Marshall states, Long term we are going higher. we have lots “noise” out there now so nobody knows what time will bring.
bobby
Yep, Bobby, I also agree with Marshall.
Have a great Sunday.
Big Al
I captured a screen shot of a video presentation by our friend Morris Hubbartt at http://www.superforcesignals.com
http://i45.tinypic.com/24zhx6u.jpg
Unfortunately, I’m not able to link directly to the video, as it’s available to subscribers only.
I’m no expert chart analyst, but from what Mr Hubbartt pointed out; the extremely high level of commercial participation in the Euro means that the Euro is going much higher; therefore, likely US dollar lower and gold higher.
Any thoughts from others who know more about this than I do?
Almost impossible to predict the future, but I simply don’t see how the Euro’s value can possibly increase.
Be interesting to see what others think.
Big Al
Adam Hamilton, the author of the linked article, brings up a point I’ve been thinking about although he doesn’t make it this way: When Greece pulls-out, which could be any day now, the euro will surge, the US dollar will probably fall, and several major US and European stock bourses will surge, for a while at least. It’s a little hard to say what gold will do. In theory, many would think it should fall, in opposite to the equity markets. But in reality, it may not drop much due to the strong hands who will refuse to sell at any price.
Things will remain that way until the next nation needs to have someone purchase their bonds. Spain is at the top of that list, although Italy or little-talked-about Belgium are also near the top. In about 2 years, France will be needing help. Recall that Sarkozy tried to get their budget deficits from 9% of GDP down to 7%…and look at the hell he caught for it. Now they’ve got Hollande who says he wants to get it down to 3%, but has a whole new slew of spending lined-up. AAA or not, France isn’t going to be able to sell Eurobonds.
Sure does appear that way, Don.
Big Al
Al,
I wish i knew more about currencies, I rely on Chuck Butler and his Daily Pfennig for my currency information. He can be found on Kitco. He is usually my first read of the morning.
bobby
Thanks Bobby,
I will start reading his material.
What to you think of Axel Merk? I, personally, like the man.
Big Al
Reposting with only one link:
I captured a screen shot of a video presentation by our friend Morris Hubbartt at superforcesignals.com
http://i45.tinypic.com/24zhx6u.jpg
Unfortunately, I’m not able to link directly to the video, as it’s available to subscribers only.
I’m no expert chart analyst, but from what Mr Hubbartt pointed out; the extremely high level of commercial participation in the Euro means that the Euro is going much higher; therefore, likely US dollar lower and gold higher.
Any thoughts from others who know more about this than I do?
Mr Gold corroborates what I was stumbling around regarding Euro in his post titled “Majority opinion is not always correct”.
http://www.jsmineset.com/2012/05/25/majority-opinion-is-not-always-correct/
Hi Irwin,
I trade the Euro/dollar and looking on a monthly, weekly, or daily chart, I see all down.. No reversals yet. Best
Hi KS,
Deciphering Sinclair’s post to the best of my ability, I can’t identify a specific time frame; so it may be weeks or months before his scenario plays out.
Cheers
With the scenario we have people that need to sell what they can sell.
Dennis,
I am confused about what you are saying regarding a scenario. Are you speaking of the overleveraged investor or a former comment?
Bobby
I think it those people ,,,,who”,forgot to keep some powder dry..”…
bobby,
if you needed to raise double available cash Tuesday AM…..what sells first?
Volume with bids goes!!!!!!!
Stuff you would rather keep goes!!!!!!!!!!!
Dennis,
I understand that most funds are margined. To me the only person needing to sell would be someone leveraged. I have no debt therefor would only need to sell anything if i ran out of cash.
Thanks, bobby
The larger point is a a macro event…the fact that an asset you own goes down in price is not necessarily linked to the fundamentals. This is why there are great deals to be had at an estate sale.
That is absolutely correct, Dennis M!
Big Al
Ok one more comment before church this morning:
Last night SNL did a spoof on the Rep race. Ron Paul was completly ommited. I said to my wife, ” They didnt even mention Ron” her reply was. ” he is invisable to the masses, just like gold is” She went on to say, that she trusts our decision on gold, but my continued support and statements that RP is going to win the nomonation is begininning to cause her doubts”. My wife, is IMO the most informed and intellegent person alive, unlike ‘one track’ me. I am beginning to believe that the country/world is not ready for either of them.
I am looking forward to my fishing trip to the keys tomorrow and I am considering leaving my laptop behind for the week, wow.
Happy Decoration Day to All,
bobby
bobby….have a great trip to the Keys….watch out for the storm….most likely will not go that far south….but, with that said have a safe trip…
Morning Bobby and In the Box,
Yes, Bobby, do have an enjoyable and safe trip.
Small world, sometimes I also don’t think the world is ready for either my wife or Ron Paul!
Best,
Big Al
For those who love Newfie music:
Every Sunday at 9 a.m. Mountain time (about one hour from the time of this post) one of the Fort McMurray radio stations plays Newfie music on “The Banks of Newfoundland” program.
Here’s a sample of the type of music played on the program:
http://www.youtube.com/watch?v=nAa0FZsJY5c
copy & paste link to the radio station:
(www) country933.com
Many thanks Irwin!
To all, we are off for the day on a boat trip through the San Juans.
You all have a wonderful day and I will be back later today.
Best,
Big Al
Have a great trip – thanks for all your hard work, much deserved cruise, sounds real fun.
All the best to everyone,
Marc
Go Azzzzztecs! 🙂
jerry m…says….go gators……..
don’t gators eat aztecs…..
No, no, no….Jerry….actually…..Aztecs SPEAR gators! You what though, my Aztecs can’t hold a candle to the U of F…..in any sport except maybe tennis and V-ball? yippppeee….Marc
NOW THAT IS THE “SPEAR-IT”
It took me three times to “get it”. LOL!! Geeeez, I am slow!
well, after all it is a holiday…..and we are all a little slow…
Marc,
You forgot golf!
Big Al
HI Marc,
Great job on the program yesterday.
Our “cruise” lasted about 8 hours. Gorgeous day and very interesting conversation on the boat. About 51 people and I didn’t talk with anyone who was voting for the incumbent!
Big Al
Thanks, Big Al.
Yeah, Golf – I forgot it – FORE!!
Good nite all!
MARC……..”FORE-CLOSURE”….hot real estate tip…..
This is what we need – an insight to make evyrnoee think
Thanks Irwin,
I took you for a dyed-in-the-wool Albertan with the hat! Nothing like some 3/4 time music to lift your spirits.
The 100 year anniversary of the Calgary Stampede this year. Should be a huge event here in early July.
Dan
Yes sir, Dan; I’ve been in Alberta since 1973. Haven’t been to the Stampede for many years; I think the last time I was there was the first year they hit one million visitors; – that’s a lot of commotion for a little “cow town” eh? 🙂
Put in some time at Ft McMurray too; another “commotion in locomotion seasoned with emotion” place. I heard the tribute Bill Bartlett played this morning for the first female shovel operator in the oil sands; “she swings both ways – a shovel operator’s joke”. Haha!
The men and women up there earn their big pay. When I was there, I rented a room from a Newf who turned down a job as shovel operator paying $50 per hour. He said the operators get two 20 minute breaks in 12 hours, and they have to keep working until their replacement shows up. Shift change isn’t always a timely event; here’s a video showing a traffic jam at shift change. I counted 107 “Diversified” crew buses caught in the traffic in this 5 minute clip.
http://www.youtube.com/watch?v=ROJg7116ufA
I liked the attitude of one young fellow from Nfld; – he said, “My teachers used to tell me I wouldn’t amount to anything. Now I make three times more than any of them made. For $50 an hour, I can take some inconvenience”.
That is the spirit Irwin!
Too bad we can’t import some of that attitude down here.
‘
Big Al
Hi Irwin,
We were in Calgary for that great event about 15 years ago.
I really like your city!
Big Al
Thanks from Calgary,
This city is a good barometer for the oilfield and is going through a bit of a boom right now. There is care not to overbuild due to the cyclical economy here.
I, like Irwin have not been to the Stampede for many years but is is a world class event.
Thanks Irwin for that video of the traffic. It looks like Deerfoot Trail in February.
Dan
Al, by all means relax and forget the cares of the day.
Jesus was crucified.
He did not show rage to those who captured him.
He did not show rage to those who jailed him.
He did not show rage to he who judged him.
He did not show rage to those that killed him.
During his ministry he only displayed rage once at a Temple.
Whose table did Jesus turn over?
If Jesus did not like them neither shall I!
WWJD
Amen…Dennis….amen. – my friend! Now go write that book! :).
All the best,
Marc
That is great, Dennis M!
Something to do with “you can’t serve two masters”!
Big Al
Al,the global markets look very precarious. The China market looks like it may fall out of bed. You know the situation in Europe which will be with us for months. There will be upward pressure on the dollar which will be negative for oil, PMs and the resource sector. Also negative for oil is the global slowdown. The US is heading for its’ own recession as early as late summer/fall. The markets are predicting a global meltdown. The PMs will not be immune. Gold is trying to hold onto a double bottom but this coming 2 weeks will be crucial. The momentum indicators lean toward a further drop. Gold should move down in the near term and the conventional markets should hold their own for the next 11/2 weeks in order to fill a gap on the dow/gold ratio. Then they both should start to move down further with the dow at greater risk. Say good-bye to the conventional markets for the next weeks to months since they’re entering a vicious bear market. The Chinese market will suffer more then our markets. I think in all likelihood we’ve seen the highs in the Dow for the next few years. You’re about to get contractions of the PEs like we haven’t seen for years. The positive is that the secular bull market in gold is not yet over and gold will considerably outperform the conventional markets in the future for years.
Doc,
Quite frankly, I have grown very interested in what you have to say, like a lot of folks on this site. However, to be honest, people can prognosticate and make fairly rational assumptions and “predictions” based on sound (I guess) technical analysis. But, for somebody who has been riding the PM “bucking bronco” for quite sometime now (If people knew my allocation of asset diversification at this moment-they would probably say I am very much OVER allocated) I continue to sleep fairly well at nite..knowing that I want to be OUT of the US dollar, banking system and counter party risk. The ultimate end game is going to be bad, really bad. This has nothing to do with fear but reality. THEREIN lies the problem. I can’t, in all GOOD CONSCIOUS, sit in cash rich positions and wake up one morning with SHTF, black swan event, that engages/rockets the BEST INSURANCE you can have in very turbulent, tumultuous times we are currently engaged in AND THAT IS, of course – GOLD AND SILVER. People ARE LIVING in a fantasy world that I refuse to live in. Now with that said, I have been blessed with a CASH FLOW that CURRENTLY allows me to sit tight, pay bills and survive. If not, then, quite frankly I really don’t know what I would do. PM’s will rise BUT, not in a straight line – UP – not even close. Therefore, you might be RIGHT ON with all your analysis, however, the “PAPER MARKET” will NOT give up the ghost all that easily – the FEDS will come to the rescue. All we can do is sit tight and hang on for the ultimate “investment ride” of our lifetime.
All the best Doc,
Marc
Marc, I’m with you. There’s nothing I would rather own then PMs. The conventional markets are not your grandmother’s “buy and hold”. That would only apply to an expanding market in a solid economy. In the past the economy would dictate the markets; today money printing dictates the markets which dictates the economy (which is a false economy). Stick with your PMs and add intermittently on pullbacks since you won’t regret it. That’s one of the rare things I can guarantee in the financial mess we exist in today.
Spot on! Doc thanks for all your valuable insight!
Marc
Marc, you won’t see a secular bull market in the conventional markets until the day when PEs are in the single digits and dividends are about 5%. We’re a long ways away from that day.
Marc,
Please, please diversify a bit just to be safe!
Big Al
Thanks, Big Al….I really do appreciate your point of view, as you know.
Doc and Marc,
I really appreciate the discussions you both present to this blog. Thank You for your diligence and daily comments. I have a lot to learn, and you both give a lot of “food for thought”.
Jody D
Jody D,
I am happy we have this site to learn from each other!
Good nite and all the best to you.
Marc
Jody, you’re welcome. Like life, I try to call them as I see them—-also, I do give options on the direction of the markets but then will give my feelings based on multiple charts I watch. I look at the intermediate to long term mostly since I don’t tend to trade. Occasionally, I’ll give my view on the short-term based on charts that are screaming at me about a short-term move. That’s why I gave the one I did recently. When I feel the PMs are ready to make a significant move up, I’ll state it strongly.
Evening Doc,
Got time to come on the show some day this week?
Big Al
Sure, just give me a date and time—-remember, a 3 hour difference.
Hi Doc,
How about tomorrow at 9 a.m. my time?
Big Al
That’ll be 12 PM my time. I’ll have my phone with me. Hopefully I’ll be done repairing an irrigation line one of my neighbors put a shovel edge through.
Done.
Again please send me an e-mail letting me know which number to call.
Best,
Big Al
RIchard,
Remember to turn off the watering timer. We don’t want any accidental hydro-cutions.
I think in a blog the humor doesn’t come through. Just make sure the 10AM watering doesn’t get you in the face!
(I used to live 1 mile from a pumping station, and I’ve got a mouthful of water at 80 PSI while working on my sprinklers.)
Richard: Difficulty for most people is to manage short term for long term or other way around. Technicians use all sorts of tools to do this with certain degrees of success, which you apparently have.
The following link at KW posts comments from Robert Fitzwilson a long time veteran, underlines the difficulty people have in investing, namely that in trying to manage short term people will throw out the baby with the bathwater ignoring the long term. Big mistakes are compounded with disgust and fear, something we hear constantly on this and other boards.
My suggestion to all people who expect to be living minimum couple years from now is, to dig in deep for the long term and do not panic when the shells are going off very close. Panic is based on short term events, which is likely to kill if a person runs out across a violent battle field. Sir Harry Schultz always said, in a collapse the winners are those who loose the least. I might add that a person would be smart not trying to beat that, because only a very few who are both lucky and skilled manage to stay even or profit.
Fitzwilson and other veterans are telling us the violence is going to increase and unless a person gets hit by a direct bunker buster, those who stay dug in deep will come out alive perhaps shaken but not stirred.
Clay, one of the problems is the old saying of “keep your losses to a minimum” and the feeling that people have the biggest problem of holding a position too long. The difficulty with this is that when you’re on the right side of an investment and it goes against us, the tendency sometimes is to sell and lose a winning position. I know one thing; I’ll stay with my metal position through thick and thin since I know almost with certainty we are a long way from the highs in gold. I also know that when my technicals tell me that I’m not on the right side of a position and that I’m on the wrong side, I don’t try to prove I’m right and I will move out of a position. Gold right now tells me I’m okay in the long-term even though it may move lower.
We have some very sad candidates for congress and Pres and VP. The people mentioned for VP from Romney campainge, are very weak and uninteresting. The current gov. of New Mexico [Susan] is interesting , but also inexperienced, I think Obama has become a moderate repub. rather than a democrat. Romney is as dull as an old knive. at least VP Biden has some smarts. if Virginia , ohio, and Colorado go for Obama, he will win. Even if Romney wins FL. it wont help him. the northern 5 counties of Virginia are very suburban, Dem. and growing with Hispanic and Asian population. I predict Obama wins Virginia by 4%. Ohio by 2% and colorado by 1%. I am a beliefer in replacing the strange electoral college system. Thanks to all vets esp. my fellow tin can friends . Vung Tao SRZ 66.
Interesting thoughts, Scott.
I personally think that the election, at this moment, is too close to call.
I also really don’t see a lot of difference between the two apparent candidates.
Big Al
Gone Fishing
Have an enjoyable and restful time, my friend!
Big Al
Hi,
As a real estate guy, I enjoyed hearing this debate on housing:
http://www.financialsense.com/contributors/michael-shedlock/housing-debate-big-drop-ahead-or-buy-now