Quote: (05-18-2013 08:33 PM)WestCoast Wrote:
2. If you can't buy a single family home you can buy a REIT. That on the of the best things you can do.
No, it is one of the WORST things you can do - it is NOT a substitute for a home; it has eery correlation to the S&P 500! It's more like buying a share of GE. Here is a chart of a residential REIT you named, plotted against the S&P 500. BTW, you do know what "correlation" is, and why it is important, don't you? You DID pass the CFA, right??
http://finance.yahoo.com/echarts?s=CPT+I...undefined;
REITS are OK as an asset class all their own - but as a substitute for a bricks-and-mortar house? NFW.
Quote: (05-18-2013 08:33 PM)WestCoast Wrote:
Your attacks on my "DCF" explanation are lame because most people here don't even know what a DCF is or how to make one.
Anyone here not know what a discounted cash flow is?
Quote: (05-18-2013 08:33 PM)WestCoast Wrote:
Houses as an inflation hedge is quite obvious. It is one of the four tenants food, water, shelter...
That's three tenants. And I've just given you a page of fundamentals why it may not be true. WE JUST LIVED THROUGH A PERIOD, IN 2006-2008, WHEN THE NEED FOR FED-INDUCED BUBBLE-DRIVEN HOUSING PRICES TO EVENTUALLY RETURN TO PRICING MORE IN LINE WITH FUNDAMENTALS WAS ***PAINFULLY*** DRIVEN HOME TO WHOLE WORLD. Were you asleep during this time? Are you Rip-Van-Cupcake??
The definition of insanity is doing the same thing over and over, and expecting a different result.