Dave
While I’m not familiar with your individual circumstances, as everyone’s life situations are different, you do mention that you are older, so I will tell you what I would do if I could not own any single family properties.
Real estate
•As you can see I am not a fan of REITs, but there are other alternative avenues that are emerging. In terms of SFR’s, there are companies that are being set up to invest directly in properties and other passive smaller investors are able to contribute to particular properties. I know Jeff Bezos has formulated such a vehicle. I guess there are advancements being made with other types of crowdsourcing, but the key is to directly own the asset, if possible. Direct ownership is key, because that affords the holder with all of the tax and discretionary benefits that this form of ownership provides.
Farm and ranch land
•Directly own farm and ranch land. I observe how the wealthy continue to scoop up large swaths of unimproved farming and ranching acreage around the country. The vast vast majority of individual investors will never endeavor such avenues, because of social proof. They don’t know of anyone who buys this, but I know there is farmland in Virginia where I am buying that owners lease out to ranchers and farmers. While the yield may be lower then what we could achieve with an SFR, these types of land parcels continue to escalate in value and internal rates of return will be high enough, because the investor will make money on the back end as the asset appreciates.
Money market funds
•For risk averse or simple older folk who do not wish to be actively involved in any investment, I can’t help but notice the tasty yields we are receiving in money market funds; at least 5%, risk-free. That should help us overcome inflation without having to do any work and planning, and I don’t know if the Fed will ever be able to lower interest rates again for a long time.
Inflation-proofing for the long haul
•Concentrate on inflation proofing your Investments. For the past couple years, I have been warning my readers to prepare for much longer periods of elevated inflation than what we were being told, because this inflationary cycle was intentionally established by the governing authorities.
Cost of living crisis
•I’m observing that oil and commodities are rising out of their intermediate channels, which tells me that inflation is nowhere near solved. I submit that inflation is going to continue to simmer and persist until the end of the decade. This seems to be an objective of the globalists moving out to 2030 and the Great Reset. These globalists will provide no solution to the “cost of living”:crisis. In fact, the mainstream press have coined this crisis the “Cost of Living” crisis. For the faint-hearted and risk averse, this will indeed be a crisis. For the older folk out there, risk aversion will be your undoing. You, as an older investor, must have your mind around this new reality and not be fearful.
Firms with inelastic demand
•I recommend stocks that can continue passing along their expenses to the customer. In essence, these firms provide goods and services in which the demand for their revenue is inelastic. This is why many of the large tech companies have prospered at the expense of their customers. Anyone who has been invested in the tech sector and stocks like Walmart and the XOP or XLE have done very well.
Domestic energy sector
•Look at ExxonMobil and the XLE, XOM has more than quadrupled since being pulled from the Dow Jones index, when I recommended buying it for the first time. At the time, it sported a yield of 9%. The energy sector still provides an amazing source of potential wealth given what the Biden regime and Western governments have been accomplishing to subjugate their populations with electric.
Stay away from inefficient firms
•I would stay away from all of the green energy sectors as they are very cost inefficient and are only being propped up with federal government subsidies. Picking the right ESG stock is equivalent to gambling on the slots. Stick to predictable Blue Chip stocks with decent dividend yields as the world continues to consolidate and coalesce around these companies.
These have been my marching orders for my readers since the covid stimulus packages were announced in March and April of 2020. Anyone who has listened to my advice has been able to do very well with little added risk.
Fiscal deficit spending is killing bond holders
The Great Reset will be built with fiscal deficit spending amounting to the tens of trillions over the next six to seven years. Thus, fixed income investors as well as taxpayers will take the beating. Invest in short-term fixed income paper like money market funds and minimize your tax burden. I continue recommend staying away from longer dated bond holdings.
Conclusion
investors cannot be scared and continually looking over their shoulders in order to make money. I’ve been recommending passive Investments like stocks and all the other recommendations since early 2020 when the covid stimulus programs were announced. Heck, I recommended all sorts of assets at the time, and still do. I just hope you have been listening.
Despite the constant fears of asset bubbles, there will be sectors that will continue to power through all the way to the formal introduction of the Great Reset. Older investors need to come to terms with these realities and if these older investors are too risk-averse, they’ll be the Great Reset’s worst victims.
But if we understand this conspiracy, we shouldn’t be fearful. We have been able to predict the future, because we know what is entailed to achieve these globalist objectives. It really is a straightforward process when we know what it takes for the Great Reset to be achieved. Just don’t drown me out in a sea of stupidity.
As someone who has played the markets for at least 30 years, I’m taking a look at Nvidia NVDA. I can’t help but contemplate the high probability that its stock price will fill in the gap. Eventually, all stocks that gap higher fill in the gap. Sometimes this happens more quickly than others.
Don’t be a landlord in the blue areas….
New York City; Cut and run: Rent-stabilized landlord sells at 44% haircut
Deal shows blow 2019 rent law dealt to valuations
https://therealdeal.com/new-york/2023/09/20/rent-stabilized-landlord-sells-portfolio-at-44-discount/
I think landlords in blue states will give up and renters will have a super hard time finding a place to rent. Many formerly rented places will end up becoming expensive privately owned condos or they will be slums with expensive rent as the supply dwindles. Once again, the policies of the demorats help the rich and drive out the poor.
The irony of that. Republican policy actually helps poorer people more, but the words of the Democrats drown out their deeds.
As long as we know this we can profit from democratic largesse that actually creates a dependent voter.
2/2 condos that were selling for 140k in Shenandoah County less than a year ago are now listing for 185k. Condos that sold for 119k in April are now listing for 140k.
Some collapse. The red areas are on 🔥🔥🔥.
I just talked to a lender about perhaps cashing out on a 4/2 detached house built in 2002 in Strasburg VA. The market value is about $350k. He asked me for the annual property taxes and I told him it’s about $1380 a year and my insurance is about $650. He was shocked and thought I was joking. I told him it’s a red area. He immediately knew what I meant.
Although I have a 140 IQ, it doesn’t take an advanced intellectual capacity to comprehend any of this. All I ask is for the reader to leave confirmation biases at the door. Also, it helps not to get injected with mRNA poison from DARPA and the DoD Pentagram.
Having the ability to comprehend cause and effect relationships is key.
I am noticing that my Covid vaccinated relatives and professionals that I work with are getting brain fog. They are complaining that they can’t do nor think certain things like they used to and I notice they are getting more spacey. Some other vaccinated people around me are getting more cranky. I really started noticing this in the last couple of years since these mRNA kill shots got rolled out.
I am glad I keep a relationship with our Lord Jesus Christ. In my prayers, the Lord told me to avoid the covid vaccines despite being pressured and bullied by people near me. The Lord also gave me strength to hold my ground against the bullying.
I really got the hunch these vaccines are dangerous and now time is proving this as people around me are getting cancer and/or heart problems.
Keep a close relationship with God. It is most important to obey God’s direction instead of listening to people around you most of whom are asses. If I listened to people around me I would be dying like them.
In regards to the covid shot I know a lot of people who got it. The only thing I find odd is some of them got covid anyway but I have not noticed any unusual behavior nor have they reported anything unusual health wise. I am one of the few in my circle that did not get the shot, and I had covid back in Mach. Fortunately it was a mild case, and I felt fine except a sore throat for a few days, but I went on with my day uninterrupted.
The horror stories of people having major issues or dropping dead as a result of the shot does not seem to happen in my circle. The one person that comes to mind is a friend living in Southern OR who died of covid. He didn’t get the the shot and got really sick then died a month later. His wife, who also didn’t get the shot, got covid also but she is still with us. For me it’s really hard to draw any conclusions about the effects of who go the shot or who didn’t.
I noticed they’re getting sick. They seem to be in and out of the doctor’s office continually with conditions that seem to mystify the so-called experts, who recommended the injections in the first place.
There’s enough stumbling blocks in our lives to create problems, but not having health issues is an important one that up till now I have not been too concerned about.
For those that don’t notice any changes in people’s health or minds since Covid vaccination are either not paying attention or isolated in their own world.
The other possibility is that certain areas may have just gotten a placebo. I do see disturbing circumstantial evidence that some people who got the vaccines have gotten placebos as they got no effect from it. It is obvious to me that these Covid vaccines are designed for purposes other than protecting against the fake Covid 19. Some people got placebos so as to show to others that “see, this vaccine is not so bad” and encourage others to take the vaccine.
Also the effects don’t kick in right away. My experience is that the bad health effects started showing up in people around me about a year after the shots.
I know Mexicans up here who have taken the vaccine and so far show no effects, yet, the white people who have taken the same vaccines are showing health problems.
I am not surprised to see a lot of Hollywood and music stars as well as famous athletes who have taken the vaccine suddenly pop off or get sick because those up top probably want to get rid of these people as they cost too much.
Andrei, covid is not fake. I had it and my friend died form it. Now another friend has it. I have been sick before but this was not quite the same feeling. Fever, chills, sore throat but I felt perfectly normal as far as doing my job. Good energy, etc..
I just remembered one friend got a sore arm and another got temporary hearing damage in one ear after getting the shot but that is still very much a minority in my world. I’m not building a case to get the shot. I’m just saying I have not seen people around me fall apart because of it. As to why some people react to the shot and some don’t who knows. Did some people get a placebo? Maybe. You and I can’t prove this one way or another. All anyone can do is look at real life data objectively and add up the results. And there will be holes because some bits of data will never be known in our lifetime if ever.
Here are my thoughts on the whole covid thing: I believe it is is man made. And if you follow the timeline, I believe the entire pandemic is manufactured for the reason to get people to take an experimental shot that otherwise no one would take voluntarily.
Like self checkout lanes in the store, the medical industry is likely working toward some efficient jab to fix certain problems quickly. Just think about it and examine the REAL events that can’t be disputed. Has the majority of the population heard of mRNA prior to covid? The various articles describing how mRNA works flooded the internet sold the majority on this new cure at a time when people were desperate. From the time that covid hit we were being built up for a magic cure. And what luck! In about a year, a couple of scientists had this breakthrough at the perfect time when the world was crippled from a disease that was unstoppable. Ten years of mRNA research and it’s ready for prime time right when the mystery bat disease destroys life as we knew it. It’s a horror movie plot. People love movies with happy endings, right? The magic cure is administered to the population in record time.
To me the events and timeline were choreographed like a Broadway musical while being a massive sales pitch for experimental medical treatment. It is for this reason I became suspicious of the jab very early on and decided not to take it. Not because I think covid is fake.
Just as we have been predicting since interest rates started climbing, interest rates are going to remain higher for longer. The incredulous investors do not understand the conspiracy, but we do. The “cost of living” crisis that is unfolding is completely intentional yet was avoidable.
Hold on to those assets. Take a look at what the Nikkei 225 has been doing over the past bunch of months. Nothing like a good bout of inflation to help stock prices as people look to any place for inflation protection, especially when this inflation is building due to a loss of confidence in the governmental and Central Bank institutions.
I have been going to the Walmart in Woodstock VA and the place is packed with the downtrodden foreigner non-english-speaking dregs. Their shopping carts are stuffed with garbage, and of course, they vote Democrat and the Democrats give them at least $2,200 a month in free spendable money. Own WMT!
The clueless American left have no idea how they are getting sucker punched. All they do is complain about the cost of living increasing yet they continue to seek the same avenues and vote the same ways.
Do whatever you have to do to hold on to your assets and drown out the mainstream press. A word to the wise here, I would not be seeking rental properties in places like Florida. I am reading how insurance rates are now reaching five figures a year. I left Long Island and New York City because the taxes and regulations were outrageous and moved more south to establish myself. Florida is becoming just like Long Island with palm trees. Screw that!
Keeping perspective on Fed action. Though overnight interest rates are very high, there is demand for federal government paper with money market funds. Fed balance sheet runoff still has a long way to go to bring its total balance in comparison to a few years ago.
https://knowyouradversary.com/wp-content/uploads/2023/09/fredgraph100.png
If I were planning, which I am personally, I would wager that there is another planned crisis coming up and the Fed needs to unwind as much as possible in anticipation of future stimulus actions.
It’s either that or Joe six-pack will eat higher rates forever.
Either way, the average person will continue being financially destroyed. But hey, although God created the different races for a particular reason, humanity can try to prove him wrong by mixing it up and concentrating on foolishness while humanity continues crashing and burning into an Elysium tableau. Perhaps the mixing is what is precipitating this timeline. Nobody left to resist. While civilization is transforming into a real slave state, everyone’s distracted trying to prove their not racists.
Home builder sentiment may be in the toilet, but why are homebuilders stocks near ATHs?
Take a look at what these home builders are selling for a clue. New home construction looks like no frills garbage. They sell cheaper homes, because that’s what the multiculturalists can only afford. I tour these home builder developments and their product looks as cheap as ever.
Perhaps, these builders can build storage sheds where the people can sleep and eat their Soylent Green rations.
Schwab Value Advantage Money Fund® Investor Shares
7-day yield: 5.22%
https://knowyouradversary.com/wp-content/uploads/2023/09/ratemurder.jpg
If the author of this article below could have asked the futurists like Julian and Aldous Huxley, HG Wells, and even Orwell who illustrated how feminism and the “victory over the orgasm” were solely designed to demoralize the population, break up the family unit and make them more dependent on the government, he wouldn’t be so surprised.
These futurists all knew for at least 100 years that the demographics of today were planned a long time ago. To my readers, none of this is a shocker. Landlords love 💕💕💕 feminism and social justice. So many more broken sadsacks applying for SFRs. Corporations love 💕💕💕 this also as it creates more sadsack souls who spend more money than they earn to assuage their soulless and empty existences.
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In 16 Virginia communities, households with people living alone outnumber households with married couples
The number of people living alone has soared since 1940 and is now at an all-time high.
If someone from 1940 suddenly appeared among us, they’d be astounded by many things. Some are obvious: Segregation is gone. Women are routinely in the workforce. We all walk around with the knowledge of the universe in our pockets, yet use it to share conspiracy theories and cat videos.
Here’s something that might not be so obvious, though: That 1940s visitor would be shocked by how many of us live alone.
In 1940, one-person households were something of an oddity — just 7.7% of the nation’s households were people living alone. Today that figure is 27.6%, according to a recent report from the U.S. Census Bureau, which is gradually releasing more detailed figures from the 2020 headcount.
That growth hasn’t been sudden — the big jump was actually during the 1970s, which coincides with a sharp rise in divorce rates — but the upward trend still continues, even though divorce rates have been going down since 1980 (although they’ve ticked up in the past few years).
https://cardinalnews.org/2023/09/15/in-some-virginia-communities-households-with-people-living-alone-outnumber-households-with-married-couples/
2027
Divorce rates have been going down because less people are getting married. Only a few people from my younger peer group are still married. One coupole I was the best man since I introduced them at a night club. They moved in weeks after that and were married after four months of living together. They made it work and have two kids. A decent story as compared to the horror stories I hear about with others.
Most females in the dating pool now come with kids or at least one, and the kids usually do not look like the mom. Even the really hot ones wonder why men don’t wanna stick around with her and the mixed kids. I think that’s the reason for rumors of lowering the age of consent, so men can find wives without any baggage. I think a time period in the past only wealthy people got married? I really don’t have a reference what couples did in the 1600-1800’s, maybe they just lived together.
South Korean housing is some of the most expensive in the world, with a price to income ratio (PIR) of 26 versus the US at 4.5. The PIR around the world is about 11.
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South Korea’s Central Bank Warns of Overpriced Housing Market, Excessive Debt
2 hours ago
(Bloomberg) — South Korea’s central bank warned that housing prices remain overvalued relative to basic economic conditions and household debt levels are excessive.
“Housing prices remain at a high level, out of sync with income, and the housing price-to-income ratio is very high even compared with major countries,” the Bank of Korea said in its monetary credit policy report on Thursday.
South Korea’s house price-to-income ratio, or PIR, is 26, according to cost-of-living data website Numbeo. The widely used measure of housing affordability means a citizen needs to save 26 years of annual income to buy a house. This is more than double the median ratio of other countries, the BOK said.
“It’s natural to say South Korean house prices are overvalued as you are unable to afford a home without help from your parents if you’re getting married,” Hong Kyung-sik, head of the central bank’s monetary policy department, said in a press briefing.
Housing prices rose in July after sliding for more than a year, and banks’ household loans have also expanded. Unlike major countries, household debt in South Korea has continued to increase without deleveraging, reaching a level that undermines macroeconomic and financial stability, the central bank said.
©2023 Bloomberg L.P.
Any thoughts on buying in Japan? Obviously a culture shock, but those I know who work over there say that the Japanese are very polite and the country is spotless. Their demographics have imploded. $30 000 for a house sounds very reasonable to me. One of the pics – of the overgrown house – reminds me of a book I read a while back titled “The world without us”. It doesn’t take nature long to reclaim what we have built. https://www.architecturaldigest.com/story/why-japan-has-millions-of-empty-houses
Japan is a very wonderful country. It is safe and clean except for Fukushima. I would think that the demographics would not favor rising rents unless there is an uptick in immigration or increase in birthrates.
You will have to consider the cultural differences if you are thinking of moving there. While the Japanese are friendly, their society is much more rigid compared to USA but not as totalitarian as China. Japanese also are not very open to foreigners.
The other major thing to consider is the area around Japan, Korea, and Taiwan could be a major war flashpoint with China. I see a strong possibility that China could take over Japan as well as Taiwan. North Korea will invade South Korea with the Russians and Chinese and they could invade Japan that way as well China come up the island chain from Taiwan.
Do your homework before buying overseas.
Why not? I couldn’t, but since when does that matter? If you are from the states and don’t care about staying here, perhaps give it a try. You couldn’t guarantee that you would get your money back if you tried to sell.
I am familiar with Japanese culture. I worked at Sakura Trust in midtown Manhattan during the early 90s. It was a culture shock and was before the great Japanese demographic fade began. There are reasons why Japanese do not like old houses. They are usually not built as well as American houses and depreciate much more quickly.
Anyway, if you really want to make a change, then why not?
As for strategic living, I would not want to be a white American living in an alien country so close to China come the great conflict. But everyone is different. Be respectful and keep a low profile in Japan. Plus their legal system is definitely different than ours, so be careful to observe their laws.
Good luck if you give it a go.
US oil production about 2mm bbls a day more than any other country.
#usawinning
OPEC+ is nothing but controlled opposition for the Biden regime to blame for the rising oil prices. Imagine if the Biden regime were more amenable to the demands of the oil and gas sector. Oil production would be well over 13 million barrels a day stateside.
Meanwhile, liberal voters cannot see what the right hand and left hand are both doing.
https://knowyouradversary.com/wp-content/uploads/2023/09/Oilchart.png
https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRFPUS2&f=M
The suppressed oil production seems to go hand in hand with the push to electrify everything. Blame oil for climate change while pushing to electrify everything as a way to slow climate change. And I suppose the public is to believe all the icky oil that we stop using will just sit capped up. We have magic electricity that is generated from renewable pink fairy dust.
I think the reality is the reallocation of a resource that has the most bang for the buck in terms of energy production. As with certain industrial chemicals that are not available to the general public, liquid fuels or natural gas may wind up the same way? No one will take your gasoline powered car away, but as we have seen with firearms, the process to buy ammunition has been drastically altered.
It just occurred to me that the gas chamber is bad but the electric chair should fall right in with the new green technology.
Overall, inflation data a little hotter than I expected. Bonds not happy.
Core CPI (MoM) (Aug)
Act: 0.3% Cons: 0.2% Prev: 0.2%
Core CPI (YoY) (Aug)
Act: 4.3% Cons: 4.3% Prev: 4.7%
CPI (MoM) (Aug)
Act: 0.6% Cons: 0.6% Prev: 0.2%
CPI (YoY) (Aug)
Act: 3.7% Cons: 3.6% Prev: 3.2%
Real Earnings (MoM) (Aug)
Act: -0.1% Cons: Prev: 0.0%
The younger and more multicultural economists never dare question the establishment’s line.
Be very careful when listening to a multicultural economist as their predictive capacity will be much worse than someone with my capacity. These economists never dare question what is going on. They may have taken a number of calculus and econometrics classes, yet they possess little wisdom and introspection.
And then there are the others who get trapped in the Left/Right paradigm.
Bonds selling off in anticipation of poor inflation numbers…. I’ve been following and trading a stock that was recently added as a number one pick to Zack’s, GTEC. It’s now pulling back here and I would add on weakness. Still cheap.
👀
A reader, Jules, is correct. He theorized that higher interest rates actually invites higher inflation numbers.
High interest rates and higher bond yields do indeed invite higher inflation. The problem is that a greater percentage of the economic output is devoted to servicing debt. With rates continuing to rise, costs of capital continue to escalate and budgets become strained. The problem is that overall demand becomes subdued while overall spending continues to climb. As a firm’s cost of capital continues to climb, it has the result of restraining output on the margin and overall market supply pulls back. This results in a higher equilibrium price in the marketplace. While demand may waver, supply follows suit as the supply curve shifts up into the left.
It’s sort of the worst of both worlds, however, GDP numbers have yet to really reflect the budget busting effects of higher bond yields and interest rates.
So far, it’s a work in progress. If you own an income generating asset, just make certain you pass your costs along to the end users and remind them that Tuesday is Soylent Green day.
Fantastic pick, although I saw your comment too late. I noticed that huge morning dip and then the uptrend started with low volume. GTEC is in the EV heavy equipment sector and connected to one of your old picks CYN, which also has recent good news. I remember when you mentioned that one when it was below $1 and then it went up and held for awhile.
With last weeks runup and the new models going into production I think GTEC gets an offering soon, but if it isn’t a big one and it shouldn’t be as theh company has more cash than debt, then could be a long term hold.
From Bloomberg evening brief… An avoidable, but manufactured Hegelian crisis for the Great Reset. Imagine this going on for several more years…. Vote for social justice! Spend other people’s money like Judas to convince us that everyone is the same. Mix it up and spend!
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Mohamed El-Erian is warning that a swath of corporations will be hurt by higher interest rates when they have to refinance next year. “If you look at high yield, if you look at commercial real estate, there’s massive refinancing needs next year. Massive,” he said Friday. El-Erian, chief economic adviser at Allianz SE and a Bloomberg Opinion columnist, warns that there are “things that have to be refinanced in this economy that cannot be refinanced in an orderly fashion at these rates.” His warning may underscore why the stakes are so high for understanding how much longer the US Federal Reserve will keep interest rates at elevated levels. And El-Erian isn’t the only one warning that the US economy is just beginning to feel the effects of the central bank’s aggressive monetary policy tightening. Apollo’s Torsten Slok said the impact of rate hikes is beginning to ripple through credit markets, with delinquency rates on credit cards rising.
Good luck with inflation reduction….
Panama Canal Says Traffic Restrictions Will Last Into Next Year
3 minutes ago
(Bloomberg) — The operator of the Panama Canal said there’s no immediate prospect of relief from drought conditions that have reduced water levels through the vital waterway and snarled shipping and global supply chains.
Panama Canal Administrator Ricaurte Vásquez Morales said Tuesday that abnormally high ocean temperatures, an unusual rainy season and the persistence of the El Niño weather phenomenon mean officials will have to continue restricting vessel traffic into 2024.
Daily traffic has been reduced to 32 transits from 36 previously due to declining freshwater levels at key reservoirs. The backlog of ships waiting to enter the canal has spurred fierce bidding for open slots.
Continued restrictions mean the canal will likely operate below full capacity in the months leading up to both Christmas and Chinese New Year, when it’s normally at its busiest.
“This is not the most severe drought Panama has faced, but given the operation of the canal, this is the most severe drought that we are facing even with the level of operations we currently have,” Vásquez Morales said during the virtual press briefing.
Vásquez Morales said the canal would maintain draft levels at 44 feet (13 meters) — enough for about 70% of the canal’s traffic — and would reduce transit slots if needed in order to maintain those levels.
©2023 Bloomberg L.P.
If you remember about 4 months ago I said pot stocks were gonna pop when Chucky Schumer runs his mouth, well here ya go. Sadly once again every stock I recommended on here went up. but I sold too soon. When the initial news about the DEA taking pot off schedule 1 list came out 3 days ago the stocks upticked but then fizzled out, so I sold after averaging down which was very stressful. However the other day Chucky ran his mouth with another release of the same news the other day and they popped again even more.
I sold not just because of the fizzling out and the stress, but because there was a good chance two weeks ago that CGC and ACB were going to dilute and R/S. They could still dilute with the increased volume this week, the CEO’s would be morons if they didn’t have an offering into all this buying. The low float pot stocks didn’t go up as much, but the week isn’t over. Judging from last week they could fizzle out again since most are struggling with debt and the news isn’t a for sure thing. It’s a buy the rumor sell the news scenario.
I would add an opinion, that it’s okay to be fearful, unless you have balls of steel it’s hard to hold for months and hard to sleep, especially if you buy too much.
Always scale out and take profits!
This advice pertains to short-term trades, but I normally recommend stocks for the long term. I know people who have owned stock positions for up to 30 years and their dividend yields, based on cost basis, is 60% and higher per year. The same works for single-family properties. I hold an SFR that I’ve owned since 2002 and the current rent is 2.5x my original mortgage payment, which I paid off in 2019. The price of the property has more than tripled.
Trading is a fun way to make money, if we are successful. Balance sheet wealth is created with patience, creative thinking, and planning.
Let me preface this by saying I’m no financial expert so don’t listen to me.
I have heard of people generating solid income from the generous stock dividends paid by cigarette maker Altria (stock symbol: MO). It’s pays over 8% annually and the dividend has been raised 57 times in 53 years. That’s a solid record. Based on the current dividend, $150,000 in stock would pay over $12,000 a year in cash dividends.
Not sure how $150k purchase in stock vs $150k purchase in a single family residence would ultimately compare. I’m sure there are pros and cons as well as significant risks and taxable consequences.
I’m thinking the government makes too much money taxing tobacco for it to disappear altogether. Plus Altria has a finger in the vaping and marijuana game which is New Soma for the demoralized generation. Our generous forum host, Mr. Evans, is certainly more qualified and, perhaps, could add color commentary.
Nothing is mutually exclusive per se.
Another reader brought up MO in the past. It sports a very high yield, but for a reason. Its long term performance has struggled for the past 7-8 years, but going back 20 years, MO has performed well for buy and hold investors. Imagine the yield based on buyers cost basis from the aughts. MOs payout ratio is nearly 100%, which means it pays out about all its earnings as dividends.
Okay. We can do both. Say we own 75k of MO and put a 75k down payment on a 300k SFR. 25% down would help us diversify and earn two income streams.
It depends on what one wishes to do. I have been reading that MO and AMZN want to get in on the federal legislation to legalize nationwide. Cannabis vendors would be like beer and cigarette manufacturers. The small players would get hit and MO would pick up on its abilities with economies of scale and deep pockets.
Pandemic Population Boom in Rural Hotspots Sparks Resentment
6 hours ago
(Bloomberg) — Rural America is booming, but the population growth that’s boosting local economies is also putting a strain on everything from schools to housing and roads.
The influx — which started during the pandemic — has continued even as Covid restrictions have lifted. The latest government data released just last month points to a second year of increases in 2022 after years of declines.
The trend is sparking resentment as house prices in the top 10 rural counties that have seen the biggest population increases surging more than 40% over the past three years. Schools are overloaded and the shift is even impacting farmland prices.
“There’s a lot of resentment,” said Maggie Doherty, a writer and columnist who lives in Flathead County, Montana. “There’s bumper stickers that say ‘Montana’s full’ or ‘Don’t California my Montana.’”
The number of people living in non-metro areas outgrew the urban population for the first time in three decades in 2021, and the rural population expanded again last year. But growth wasn’t evenly distributed, with the top 10 counties with the largest population gains growing by an average 5%, according to Census data. That’s more than the national average of 0.4%.
Tech-savvy Californians who work from home are fleeing to cheaper states, while retirees and nature lovers are flocking to places like Montana. Many Midwesterners have now moved to the Sunbelt. And if house prices are any indication, that trend is continuing this year.
In some places, the influx of new residents is deepening political divides in an already polarized country. The migration has the potential to change voting patterns in both the places people are leaving and the ones they’re going to, adding an additional layer of unpredictability in battleground states like Georgia and North Carolina in the 2024 presidential election.
In Jackson County, Georgia, finding affordable homes is becoming harder and harder. Prices there rose 50% in the first half of 2023 from three years earlier, according to real estate firm Zillow. The county attracted hybrid workers due to its proximity to Atlanta.
“There’s been a lot of battles politically over building and where to build,” said Pete Fuller, who lives in Jackson County and heads the Democratic Party there. “There are organized groups that do not want affordable housing being built.”
Rents have also surged. In the past two years, Harnett County and Moore County in North Carolina, Gallatin County in Montana, and Iron County in Utah have all seen rent increases between 13% to 24%, Zillow data showed.
“Rent is completely through the roof,” said Wendy Cerne, who lives near Cookeville in Tennessee. “There are a lot of new people that have moved into the region and I’ve experienced that first hand.”
The rural population expanded 0.3%, or 241,300 people, in the two years through mid-2022, according to Bloomberg calculations using Census data and a US Department of Agriculture methodology. Some of the fastest-growing rural counties have had more deaths than births over the past two years, so the growth is coming entirely from new residents.
The 10 counties that saw the biggest expansion tended to be near a big city. Their broadband coverage was also 94%, much higher than the average 79% for non-metro areas, according to data from the Federal Communications Commission.
Farmland Prices
It’s not just home prices surging in rural areas. Farmland prices — already at a record due to higher commodity costs and people buying plots as a hedge against inflation — also gained.
“Anything that helps broaden and deepen what I would call the opportunity set for off-farm income is good for producers, which is a good underpinning for land prices,” said Tom Halverson, chief executive officer of CoBank ACB, a large lender to rural America.
“The states in the South and East have been some of the biggest beneficiaries of this population movement,” he said. “They also are the parts of the agricultural production complex in this country that that are most reliant on off-farm income. So there’s an interesting correlation dynamic there.”
Newcomers are also bringing economic benefits for rural America. Moore County, North Carolina’s golf courses and healthcare facilities are the main reasons for its population growth, especially when it comes to retirees, said Natalie Hawkins, who spearheads her area’s efforts to bring investment and jobs.
Sandpoint in Bonner County, Idaho, is another growing area that lured Californians with its golf and ski resorts.
“Retiring in California is near impossible,” said Bob Ficken, who moved from San Franciso’s Bay Area to Sandpoint just before retiring as a human resource manager. “The state ends up taking between 25% and 30% of everything you make.”
Still, the arrival of new residents presents a dilemma for local officials, who prize the economic benefits they bring but also have to contend with poor infrastructure to sustain the growth. Locals complain about poor traffic infrastructure, noise, overloaded schools and even homelessness.
“Especially in cities like Whitefish, which is now becoming almost a luxury resort center, they’re having a lot of disagreements on what type of house should be built,” says Doherty, the author from Montana. “A lot of affordable housing advocates are wanting high density units, and others are pushing back against that.”
In Jackson County, Fuller says the influx is stretching infrastructure.
“You see huge issues with infrastructure as well with roads, roads that were not meant to handle truck traffic a lot of times are breaking down,” he said. “There’s been two new high schools built here in the last couple years just to accommodate growth.”
©2023 Bloomberg L.P.
By the way, if you are risk-averse, please remember that Tuesdays are Soylent Green days.
Ha!
This influx of city/suburban people moving to rural red states will tilt the traditionally Republican areas towards the demonrats on the political landscape. I see states that use to favor republicans going democrat while the traditional democrat states will stay democrat. These people leaving the blue states because of high taxes and high crime will vote for the same idiots in the rural places that cause the problems in the blue cities/suburbs. They are too foolish to know that they themselves are the cause of those problems and they will bring those problems to the rural places that they move to.
I see the USA going full tilt socialist in a few years. The Republicans really don’t stand a chance anymore. I am not saying this out of delight but this is said because of sad reality.
The only safe place is turning your life to Jesus Christ. The heavenly kingdom is the only safe and uncorrupted place. In addition, in this earthly kingdom, buy the residential properties in these rural areas so you can suck rental income money from these city transplants. Find ways to make money off of these city fools moving into rural areas.