Sanity Amidst The Culture of Doom

Mike Farmer calls for some sanity over at Bloodhound Blog.

It is now pervasive, whether fact, fiction, miscalculation or a misunderstanding of economic adjustments — doom and gloom has colored our lexicon and everyone’s on board. The “realists” are merely pointing out facts, the politicians are merely offering a big hand to help all the little people in this troubling time, the agents are merely accepting fate, the lenders are merely going broke, the pundits are merely predicting a dour future — it’s over, real estate is dead.

If you don’t believe it you are an idiot, a Koolaid drinker, a liar, a naive babe in denial or an unscrupulous player preying on the unsuspecting. When someone asks you about the real estate market, tell them it’s dead and getting worse. Tell them there is nothing positive in sight, that it might go for years, decades, a century, who knows, just tell them it’s dead.

He's pointing out that ANY talk about a recovery is akin to a discussing the merits of pornography at a Church picnic.  Funny, but true.  I am in receipt of pitying looks when I describe my chosen profession.  His summary is hilarious.

I know this is true because I just read five articles saying so, and a hundred before that, and I heard it on the news, in the barber shop, whispered a little too loudly in restaurants — everywhere, everywhere, real estate is dead

Of course, Mike's written a satirical piece.  The comments thread interested me.  Dave Shafer, another lender, said:

I believe it was JP Morgan who said, “when my shoeshine boy is giving me stock tips, then it is time to sell it all!” Consider this the opposite.

I replied:

Absolutely, Dave.  Warren Buffet describes his investment philosophy (paraphrased):

Greedy when all else are fearful and fearful when all else are greedy.

The data are proving of a decline BUT that’s already PAST data. What’s going to hurt the pessimists and bubble bloggers is that the market will turn around. In 10 years, housing prices will be up 50-75%, from today’s valuations…then what?

Is today the absolute best time to buy? Of course it is. It is always a great time to buy appreciating assets (if you can get them at the right price).

We need to adopt Jim Cramer’s approach; there is always a buy out there. Now before someone points out that he blew Bear and CFC, he’s been right a lot more than he’s been wrong.

Trends, people. Consistency, people. Future prognostications, not pointing at past data. Do your homework for your clients. Buy good properties on weakness. Put enough money down so that they cash-flow. Hold them. Sell. Repeat.

But the best comment came from someone known only as "Chris".  Typically, pseudonyms are the preferred practice of bubble bloggers.  "Chris" captured my thoughts (edited for content):

On a serious note, this is my motto when I invest:
“to buy while blood is running in the streets”
Mayer Amschel Rothschild

Blood is certainly flowing, time to go buy some property! All the pessimists and bubble bloggers better get their Geo’s the h311 out of the way of my V12 Mercedes in a few years, when the markets return and they will have wasted a golden chance to make a ton of money. I have no use for chicken littles.

I suspect Chris is a lender.  Dave is.  I am.  We seem to know when the dung's about to hit the blades and when the world is so bleak that upside is around the corner.  It's bleak- time to find some bargains in SoCal.