Registered: Oct 2006
11-20-06 08:29 PM
For those that are bullish for stocks but bearish on real estate the acid test on that sentiment is simple. Rather than just fight the housing market and sell at a loss simply strip your equity with a home equity loan on all these extra houses and condos you picked up intending to flip. Put that cash to work in the "bullish" stock market and make a 20% gain to offset the real estate loss. Then take the winnings to close out the HEL and dump the real estate at a loss but a net smaller marginal gain in total net worth. At least until the Democrats get the entire world in tax chaos again you can take the home loss write off, the mortgage rite off, the home real-estate tax write off and only pay 15% on the long term capital gains (if long 12 months or more) or a 60%/40% long/short split if doing it with options trading...
The only down side is if we have a hard landing you lose everything. But then the gov has to bail everyone out (then tax them on the bail out help in a self eating watermelon sort of economic voodoo). Either way so what's the difference since its a going to be a government subsidized economy no matter what happens...