Tag Archives: Bitcoin

STEP 2 IN THE HOUSING REVERSAL HAS OCCURRED

JUNE 14, 2022 – It is rare that you see and know a peak is occurring as you speak. Three months or a year down the road it is easy to look back and see when a top occurred. But, while it is going on….that is difficult. Being in the forest makes it tough to see the trees.
There are 4 steps for the housing market (any market for that matter) to go from growth to decline.
Step 1 – Acceleration in appreciation begins to slow down. This occurred 6+ months ago.
Step 2 – This is occurring now. Annual home appreciation in June will be lower than it was in May. We will look back at May-June 2022 and see the rollover in annual appreciation. Essentially, acceleration has turned negative. Better to call it deceleration.
Step 3 – This is the opposite of Step 1. The steep upward slope of accelerating price appreciation now becomes a steep downward slope of slowing price appreciation. This will occur the remainder of 2022 and into 2023.
Step 4 – The final step occurs when the accelerating slow down (think of slamming on the breaks) takes the market from price appreciation into price decline. This seems a far way off. But, I think we might be in for a surprise and see declining home prices quicker than we expect. We shall see.
As an aside, Bitcoin (slightly below $20k) and Ethereum (around $1k) are nearing major lows. The next move should take both to record highs (4x-5x moves from these levels).
Shalom and Happy Heterosexual Pride Month!
The Mann

SAVE OUR PLANTS, INCREASE YOUR CARBON FOOTPRINT

FEBRUARY 1, 2021 – I have spent my entire life increasing my carbon footprint.  When a friend mentions something like buying an electric vehicle, I get in my 1996 Ford 250 gas hogging truck and just drive around for a few hours to burn as much gas as I can.  For whatever reason, I have always been anti-environment…maybe because the tree huggers have just been so annoying about the issue.  I have long joked that there is lots of room on Mars for humans when we need to go there:)

It is good to finally see some studies come out to support an increase in C02 emissions.  Afterall, plants live on CO2.  Carbon neutral would be the death knell for this planet.  Thankfully, humans will continue to increase their CO2 emissions and save this planet – just as they have for the past 200 years.

Studies project the number of automobiles will increase from 1.2 billion today to 2.5 billion (!) by 2050.  98% use gas and diesel today and it is expected over 90% still will in 2050!  Wow, that is going to be an amazing increase in C02 from vehicles alone.  Add to that increasing online purchases and delivery vehicles will increase exponentially – even more CO2.  I can hear the plants saying yum yum:)

I saw this in a recent Grant’s Observer:

Bloomberg Opinion’s Lionel Laurent shines a light today on the environmental cost that has accompanied the bitcoin boom:  As the digital ducats require increasing computational firepower to process transactions, bitcoin’s current estimated annual carbon footprint of 367 million tons is equivalent to the emissions of New Zealand, while a single bitcoin transaction generates CO2 equivalent to more than 700,000 swipes of a Visa debit card, according to Digiconomist.  Similarly, the crypto’s annual energy consumption stands at about 78 terawatt-hours, up from less than 10 terawatt hours in 2017.   Then, too, bitcoin hunters have utilized global regulatory arbitrage to improve their economics.

That alone should encourage everyone to invest in Bitcoin!  Just think how many jobs are created worldwide to produce this amount of power.  And the profits being made by power plant builders and power companies.  Definitely a win-win for people and plants.  I suppose the 300-500 coal plants under construction and proposed worldwide just sends an environmentalist in to disbelief that his/her plan to kill off plants and humans has zero chance of succeeding.  Nothing like wasting time fighting a fruitless battle:)

I do find it funny that the young generations that are so in to a green economy are the ones that are greatly increasing CO2 emissions thru online retailing and cryptocurrencies.  As they would say, I am SMH.

I encourage everyone to read and pass along Dr. Moore’s, co-founder of Greenpeace (!), study on C02 and more throughout the history of our planet.

Greenpeace Co-Founder Contradicts CO2 Climate Fears

It is neat to imagine a time when humans were thriving when CO2 was over 10x higher than it is today.  As Dr. Moore points out, if we hadn’t started the Industrial Revolution and invented the automobile, it is likely plants and humans would be extinct in the not too distant future.  If the ‘we were wrong about global warming so let’s call it climate change’ people had their way, they would eliminate the lifeblood of plants and lead to the end of the human race.  The evildoers can be stopped by you simply doing your part to increase your carbon footprint.  Please do your part!

Another neat thing to imagine is when humans were thriving in temperatures that were more than 20 degrees Celsius warmer than today.  I suppose we were living all over the planet as there weren’t glaciers and such that were too cold for us to survive in.  To think the scare mongers are worried about a one or two degree increase this century.  From a historical perspective, it will still be very cold.  Brrrrr.

Save a Plant, Increase Your Carbon Footprint!

Shalom,

The Mann

 

 

 

STOCK MARKET UPDATE

MAY 10 – Hopefully everyone had a great Mother’s Day and is staying safe and well.

It’s been awhile since I talked about the stock market.  For over a month now the DOW has been in about a 2000 point range.  Quite a change from days in March where it was up or down 2000 points.  All of this back and forth and the market still hasn’t been able to get up to the 25,100 target.

As I mentioned the last time I talked about stocks, we are essentially in a stalemate.  The market should be declining to the 13,000-15,000 range.  However, the Fed is pumping trillions into the system and this is offsetting the selling.  The experts I listen to are taking the stance I am taking – stand aside and wait for a break in one direction or another to occur.

If you have had read my blog and white papers over the past decade, you know I harp on price and value being two very different things.  In real estate, prices rarely reflect the current value of the underlying asset.  Albeit market participants and appraisers believe sale prices are a reflection of market value.  They aren’t.

I bring this up because we may be encountering a historical disconnect between the value of companies and the price of their stock.  A company that was worth $100 a share before the virus hit might now be worth $80 (value is extremely slow to change for large corporations, so a 20% decline is beyond extreme).  However, if the trillions being pumped into the system goes into the stock market in some amount, then that stock that may have went from a high of $150 down to $75 in March and may now be $125.  And might go even higher.

Money is pouring in regardless of what the underlying asset is worth.  Re-inflating prices is what the Fed did starting 12 years ago and it worked for most asset classes.  They are doing all they can to make this happen again.  One day the house of cards will crumble and it won’t be pretty.  They might be able to avoid the end game this time, but I don’t think they will the next time things fall apart.

Right now the World’s Largest Casino (stocks, bonds, currencies) is open and gamblers are taking their position on how things will play out over the next 6-24 months.  But, these are simply gamblers.  True investors are still uncertain of the future and are standing aside.  There are no new mergers.  No new commercial real estate transactions.  When Sam Zell says he is still uncertain of how this will play out and is doing nothing, that speaks volumes.

As they say, better safe than sorry.  Capital preservation is key.  Don’t jump into the game too early.  Be patient.  It is ok to miss the exact bottom and wait for the new trend to start.

As a side note, remember that this is not a liquidity crisis.  That has been solved by Central Banks worldwide.  This is a SOLVENCY issue.  Companies will go bankrupt over the remainder of the year because they have too much debt.  It is that simple.  This will also apply to individuals and real estate owners.  Too much debt and you are likely to go under.  As they say, cash is king.  It will be once again during this downturn.

And a side note to the side note….The bond market is pricing in a 28% chance of the Fed Fund Rate going negative!  Some indicators suggest a drop to -2.0%!!!  Everyone says negative interest rates are not coming to America.  Even Fed presidents say that.  The only problem is the Fed FOLLOWS the bond market.  The bond market will dictate whether America goes to negative interest rates.  Right now it is just starting to head in that direction.  There will be more to discuss as this unfolds going forward.

Unemployment came in at 14.7% albeit the U-6 (whatever that is exactly) suggests we will see 23%+ next month.  The analyst I mentioned that forecast 16.5% was a bit high.  For historical perspective, we went from unemployment rates at 50 year lows to 90 year highs in a month or two.  Just insane, eh.

It’s  a big week for Bitcoin as the 4-year ‘halving’ occurs.  Since I suggested to my friends a month ago to buy some it has gone up 50%.  However, the expectation is still a 10x move from here by the end of 2021.  It seems like everyone is aware of the halving and past events and have been buying in advance.  Since past history has shown a 10% to 30% decline in price right after the halving, that would surely shock the newbies to Bitcoin.  The public usually gets on board when it is too late and then dumps when things turn against them.  I will be watching for some kind of correction between now and the end of June.  If it occurs, I will hop on board and hope the 10x unfolds as predicted.

Brent Crude is back over $30 a barrel.  Many oil stocks, e.g. Exxon, are up over 50% from their lows.  The damage will last at least another year or two.  But, oil and gas are not going away regardless of what the tree huggers wish and say.  The more electric vehicles they make the more fossil fuel using power plants get built.  Plus, 95%+ of vehicles will run on gas for many decades into the future.  It is unlikely Millennials will live to see a serious decline in the use of oil and natural gas.  There simply are no viable alternatives.

The Fake News Media likes to make the masses think oil and gas are on their way out.  They do the same with meat.  They even talked people in to creating fake meat.  Fake meat means it is NOT meat!  Fake meat is an oxymoron!  But, more importantly, projections call for meat consumption to be 70 percent higher in 2050 than it was in 2010.  PETA won’t tell you that though:)

I only bring the above items up because it all goes back to my constant reminder – EDUCATE YOURSELF!  I think we can switch up an old joke – How can you tell if a broadcaster is lying – s/he is moving his/her lips:)

Educate yourself and then make your own decision.  Think for yourself.  You will be much better off in life.

Stay safe.

The Mann