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Timed Value Introduction

timinginvestwithalex

As time went on in 2004 and 2005 I was increasingly frustrated. I was working incredibly hard, but my investment returns were not reflecting the fact. If anything, I was starting to underperform while the market was surging higher. I had big problem on my hands.  After a lot of fundamental research I have determined that the real estate sector as well as the mortgage finance sector are set for a significant decline. Not just any kind of a decline, a once in a lifetime blow up.  After reading and analyzing at least 100 annual reports I was sure of it. The “subprime” mortgage companies I was looking at were essentially bankrupt. I was sure the market will soon see the same and reward me with outsized returns.

I was wrong. Instead promptly collapsing the companies in question kept surging higher. Day after day, month after month and year after year. I could not wrap my head around it. There I was, looking at clear evidence that the “sub primers” in question are nothing more than a giant Ponzi Scheme , yet Mr. Market was rewarding them with ever increasing stock prices. That was my first clue that while the in-depth fundamental analysis can show me WHAT will happen with great accuracy, it fairly useless in identifying WHEN it will happen.  It was not until 3 years later that the said companies did collapse in a spectacular fashion. Some losing $70-50 per share price within a 2 week period of time and then immediately filling for bankruptcy (summer of 2008).

I was right on the money, yet my timing work was way off.  That lead me to spend a considerable amount of time searching for market timing solutions that work.  If I can somehow identify the “WHEN” portion of the equitation, my investment returns should surge.  It wasn’t long after I started that I came across the article below. It was a life changing revelation that showed that I can use modern science to predict the timing of individual stocks and the overall stock market with great accuracy. It was a life changing understanding and I had to explore it further.

(***I highly encourage you to read the article in its entirety to form your own opinion.  The Ticker and Investment Digest was later renamed  “The Wall Street Journal”).  

To Be Continued Tomorrow…..

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Real Estate. Buy or Run Away?

InvestWithAlex Wisdom 13

Today’s 5 Minute Podcast Covers The Following Topics and is in direct response to one of my readers questions, “What are  your views on real estate? Is right now a good time to buy?” – Roman J. 

    • The truth about real estate. 
    • What is the real reason behind real estate rebound.  
    • The shocking truth of what will happen to real estate over the next decade. 
    • What you should do now and why it will save you a ton of money. 

Did you enjoy this podcast? If so, please review it on iTunes and share it with your friends as we try to get traction. Gratitude!!!

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Daily Stock Market Update, January 16th, 2014

Daily Chart January 16 2014

 

Summary: Continue to maintain a LONG/HOLD position.  

1/16/2014 – The stock market is stuck in the trading range since the start of the year with the DOW being down -68 points or (-0.41%). It is important to note that the market opened with a gap down and while trading closed the “UP” gap opened yesterday. Why is that important? Market always closes its gaps. Sometimes right away and at times it takes a few years. The gap down in the morning means the market must close this gap before any reasonable down move can start. This works very well with our overall analysis and the notion that the bear market will start over the next few months. We continue to hold our overall long position as there has been no change in the overall trend. 

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Daily Stock Market Update, January 16th, 2014

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End Of Day Stock Market Update, January 13, 2014

Daily Chart January 13 2014

A big down day for the market. With the Dow being down -179 or (-1.09%) for the day. The market continues to falter since the start of January. As I have mentioned in my earlier (weekly updates) there was a significant turning point on January 1st. Yet, this is not the beginning of the bear market I have predicted for 2014. The market is not done quit yet with the upswing. Current market action is the beginning of the top forming process and volatility. For the time being, it would be prudent to remain long while we wait for a confirmation that the bear market has indeed started.   

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End Of Day Stock Market Update, January 13, 2014 

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Dr. Doom Needs To Grow Some Cojones

Business Week Writes:  Dr. Doom’s Upbeat Prognosis

doom and gloom investwithalex

Nouriel Roubini, the New York University economist who earned the nickname Dr. Doom with his early predictions that the housing slump would trigger an economic collapse, is trying on a smile as he looks to the coming year. In his outlook for 2014, which he laid out in a Dec. 31 piece on the website Project Syndicate, Roubini says the risk of unexpected shocks is becoming “less salient” as growth in industrialized countries accelerates to just under 2 percent. That number is close to the 2.2 percent expansion forecast by economists at Goldman Sachs (GS) and Deutsche Bank (DB).

His predictions have been less on target since he warned on his blog in early 2007 that “the party will soon be over.” At the World Economic Forum in Davos, Switzerland, in January 2009, he said, “I’ll be the first to call a recovery, but I just don’t see it yet, and it’s getting uglier.” He got that one wrong: The U.S. emerged from recession that June.

Read The Rest Of The Article Here

This should come as no surprise to real Wall Street operators. Most economists change their opinion at exactly the wrong time. They cannot see the forest through the tree.  I don’t even know what and why they teach economics.  Allow me to point your attention to a couple points from the article above to prove my statement.  

1. “Roubini says the risk of unexpected shocks is becoming “less salient” as growth in industrialized countries accelerates to just under 2 percent.”

Salient? What kind of crap is this. First, it doesn’t mean anything. Second, it absolutely wrong. The chances of “System Shock” has risen significantly over the last few years. Why? Because most of the recovery has been driven by massive credit infusion and speculation. The FED is literally creating credit cards out of thin air and then proceeds to max out said credit cards to get the economy going. Yet, it’s not working. If anything, the risk of “Unexpected Shock” is higher today than it was in 2000 or 2007.

2. “At the World Economic Forum in Davos, Switzerland, in January 2009, he said, “I’ll be the first to call a recovery, but I just don’t see it yet, and it’s getting uglier.”  Plus, he has maintained his bearing stance until now.

As my earlier work clearly illustrated, I called the March of 2009 bottom to the day and was only 100 trading points away from the actual bottom. His view shouldn’t surprise anyone. Mr. Roubini is acting like the heard. Selling at the bottom and buying at the top. Should you follow his advice or his economic forecast, you are bound to lose money.

Simply human psychology is the culprit. Just as everyone is jumping into the stock market right now (exactly at the wrong time), Roubini has changed his opinion as well. Dr. Doom my ass. All bears have been killed over the last 5 years and he is one of them. A Bear without big cojones is more like it. They should give the title to me.    

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Dr. Doom Needs To Grow Some Cojones 

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Warning: Real Estate Collapse Stage 3 Is Beginning To Accelerate

The Wall Street Journal Writes: Banks Cut as Mortgage Boom Ends

 building demolition

A sharp slowdown in mortgage refinancing is forcing banks to cut jobs, fight harder for a smaller pool of home-purchase loans and employ new tactics to drum up business.

The end of a three-decade period of falling mortgage rates has slammed the brakes on a huge wave of refinancing by U.S. households. The drop-off has deprived lenders of a key source of income at a time when the growth in loans for home purchases remains weak.

The Mortgage Bankers Association next week plans to cut its 2014 forecast for loan originations, which include loans for home purchases and refinancing. The current forecast of $1.2 trillion would represent the lowest level in 14 years. The trade group Wednesday reported that mortgage applications in the two weeks ending Jan. 3 touched a 13-year low.

Read The Rest Of The Article Here

With the 10-Year Note being just a few clicks away from 3% (up over 100% over the last 1.5 years), this should come as no surprise to anyone.

As predicted in my earlier post “I AM CALLING FOR A REAL ESTATE TOP HERE” , the real estate market is in process of rolling over.  Listen, as far as I am concerned this is incredibly easy to see and I am having an increasingly difficult time understanding how most people don’t see it. This is reminiscent of me predicting the 2007-2009 collapse in the credit markets starting in 2006.

Alex Dvorkin In Early 2006: Listen guys, this credit market is about to blow up and will take the housing market, the stock market and the entire economy down with it.

Everyone Else:  “Alex, why don’t you just fuck off…… You don’t know what you are talking about….. Keep this up and everyone will know you as the “Boy Who Cried Wolf”…. and my personal favorite “My 88 year old broker who has seen the Great Depression is saying NOW is the buying opportunity of a lifetime”.   

Right.  If you are dumb enough to buy real estate in today’s market, you will get fleeced. Big time. Those who believe real estate always goes up need to go back to as recently as about 1994 to see how people felt about the housing market. Remember something very important. Today’s higher prices have nothing to do with the fundamentals and have everything to do with the massive speculative environment in the credit market. It’s fake….its not real….it is an illusion at best that is about to blow up.

As I have said many times before, stage 3 (upcoming stage) of any bear market is the most severe. Get ready. As I have predicted, the market is already rolling over. 

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Warning: Real Estate Collapse Stage 3 Is Beginning To Accelerate

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Warning: Warren Buffett Shares His Secret On Getting Rich

InvestWithAlex Wisdom 3

Today’s 5 Minute Podcast Covers The Following Topics.

    • Warren Buffett’s secret on getting rich is finally revealed.  
    • Examples and what does it have to do with today’s market. 
    • Why is it so difficult to buy low and sell high. 
    • When will the bear market start? 

Did you enjoy this podcast? If so, please review it on iTunes and share it with your friends as we try to get traction. Gratitude!!! 

Warning: Warren Buffett Shares His Secret On Getting Rich  

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How To Make A Killing in 2014

BloombergWrites: Subprime Loans Are Boosting Car Sales

subprime car loans

A woman came into Alan Helfman’s showroom in Houston in October looking to buy a car for her daily commute. Even though her credit score was below 500, in the bottom eighth percentile, she drove away with a new Dodge Dart. A year ago, “I would’ve told her don’t even bother coming in,” says Helfman, who owns River Oaks Chrysler Jeep Dodge Ram, where sales rose about 20 percent this year. “But she had a good job, so I told her to bring a phone bill, a light bill, your last couple of paycheck stubs, and bring me some down payment.”

The New York Times Writes: New Boom in Subprime Loans, for Smaller Businesses

A small, little-known company from Missouri borrows hundreds of millions of dollars from two of the biggest names in Wall Street finance. The loans are rated subprime. What’s more, they carry few of the standard protections seen in ordinary debt, making them particularly risky bets.But investors clamor to buy pieces of the loans, one of which pays annual interest of at least 8.75 percent. Demand is so strong, some buyers have to settle for less than they wanted.

A scene from the years leading up to the financial crisis in 2008? No, last month.

It’s scary how predictable human animal is from the psychological perspective. In fact, contrary to a popular believe human psychology IS the primary driver behind the stock market volatility.

Just two quick observations. First, as the articles above indicate the subprime is back in a big way. In 2003-2007 it was the real estate market, where anyone who could (and even those who couldn’t) fog a mirror could get a massive real estate loan. Today you can see the same situation in car loans and loans for small businesses. Thank god the amounts are smaller. Second, the speculative bubble and the frenzy building in the stock market. Everyone is falling over each other predicting the Dow 20,000 or up +40% in 2014. Of course, exactly at the wrong time.

Where were these people at 2009 bottom? Did any of them predict the DOW going up over +150% between 2009 and today? Of course they didn’t. They were too busy screaming that the world is about to end and we are on the verge of another great depression. Now, with credit easily flowing again, we are committing the same mistakes. Those who can take a step outside the box should now be able to see how easy it is to profit from such insanity.

As I have said so many times before, the bear market will start in 2014. Get ready to short overvalued garbage and make a killing.  

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How To Make A Killing in 2014