Cold Feet In The Face of Uncertainty (Take The Money & Run)
Harsh Push-Back For My Optimism About A Post-COVID Economy
In the early months after COVID hit in 2020, I wrote numerous blogs about the strong likelihood of the economy and the housing market bouncing back.
My reasoning was based on strong demographic demand, a shortage of inventory, the press’s propensity to make crises seem worse than they are, and America’s overall resilience in general (as we had bounced back from many other crises amazingly fast).
Those blogs were primarily meant to be gentle encouragement for buyers who had cold feet at the time, but I got a lot of push-back from readers who were telling me I was being overly optimistic.
I was not trying to be optimistic though, as I was more trying to be pragmatic for the reasons set out above – and because there is always so much uncertainty in this day and age that nobody really has a clue what will happen.
Long story short: every buyer who did go into contract during the early stages of COVID saw their homes appreciate over the next 18 months at the fastest rate in history!
Am I Now Vindicated?
No. Not even close. I was just repeating info from various macro pundits and I got lucky too because, once again, nobody really has a clue what will happen because there are so many variables up in the air.
Cold Feet Again
I am sharing this story because we are seeing very similar concerns once again, but this time it is as much from the selling side as the buying side, as listing agents are telling us that many of their sellers are getting cold feet because of all the uncertainty in the world right now.
Jim Rogers: “Sell When You Can Make Money”
Jim Rogers is one of America’s most famous investors, as he has made hundreds of millions trading stocks and commodities over the years.
He is also an author and a frequent news and podcast guest, and he loves to repeat stories about his screw ups and bad market timing (particularly when it comes to selling too early).
He always makes this point though: sell when you can make money and NOT when you think the market will peak – because nobody on the planet can time the market.
And that is largely my message today.
Major variables that could send our economy in any direction include: (1) Inflation; (2) Supply Chains; (3) Fed Policy; (4) Gov’t Policy – including spending, taxes and regulations; (5) Interest Rates; (6) Geopolitical Strife – including the outcome of the Ukraine war; (7) A Looming Recession; (8) The World Economy – particularly with respect to China and Europe; (9) Unraveling Our Massive Debt Load; and (10) Money Supply.
I could go on and on, but the situation has been similar for years and it is why so many pundits have been getting things wrong time and again over the years (there are just too many variables up in the air and these times are unprecedented).
Examples of experts being wrong include:
- Fed Chair Bernanke’s assurances that the housing market was just fine prior to the 2008 meltdown;
- Numerous pundits telling us we’d see massive inflation as a result of Quantitative Easing;
- The New York Times insisting that the economy would collapse and so would rates if Trump got elected;
- The Fed insisting that the economy was healthy enough to raise rates in 2018;
- Numerous pundits predicting that the economy would collapse because of COVID; and
- Numerous pundits telling us that massive government spending would not impact inflation.
So, if I was a seller, I would take the money and run.
I can say that with utmost sincerity too because I am actually selling two homes right now.
And – if I was a buyer looking for a home, I would not try to time the market, my stock sales (for a down payment), or anything because nobody on the planet can time the market.
I can say that with the utmost sincerity too because I am actually looking to buy a property right now… 😊
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