After the success of the Las Vegas fund investments, many people have asked me if I see any new opportunities. For the first time in eight years, I do. The fires that destroyed Paradise, California, create an opportunity to rebuild their community and make a healthy profit. Over the next year or two, the value of buildable lots will fall considerably. Many people will take their insurance checks and decide not to rebuild, putting these lots on the market at reduced prices. Also, the short-term increase in direct construction costs will put further pressures on lot prices. We are raising money to buy as many of these lots as we can, hold them for eight to ten years, then resell…[READ MORE]

It takes more than a manic desire to inflate a bubble. The ability to deliver capital to the market is also an essential element. Repost from OC Housing News 2011-2016 Many people who believe in the wisdom of the markets subscribe to the efficient markets theory. It postulates that market participants have equal access to good information and they make rational judgments based on the available data. The theory appeals to vanity as everyone likes to believe they demonstrate above-average financial acumen and make rational decisions. Unfortunately, that isn’t the world we live in. People often fall victim to groupthink, pick and chose what data to believe and what to ignore, and seek the perceived safety of the herd when making…[READ MORE]

More than eight years after the government took over mortgage finance, the US taxpayer still insures the bulk of the loans in the housing market. Repost from OC Housing News 2011-2016 Prior to the collapse of the housing bubble, when lenders foolishly loaned money to people operating personal Ponzi schemes, it was theirs to give — and to lose. But when the losses overwhelmed our banking system, the government took conservatorship of the GSEs, and they backstopped the largest banks with our too-big-to-fail guarantees. With those two steps, the government now assumes nearly all risk of loss in the US mortgage market. With taxpayers absorbing future losses through explicit and implicit guarantees, lenders have no reason to fear inflating another…[READ MORE]

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