'Zombie' Properties Come Back to Life

Four months ago, Ky Nguyen was paying about $6,000 a month in rent for his small, 1,600 square-foot dental office, part of a mostly vacant strip mall in Manteca, Calif.

In July, he bought the entire 25,000 square-foot mall for $1.9 million, one-fifth of what the prior owner paid, purchasing it from a loan servicer that had foreclosed on the property. Now, with an affordable mortgage and some rental revenue, his debt service comes to about $2,000 a month less than he used to pay in rent for his office.

Is it finally time to buy that vacant property so that it can be rented back out?


When it comes to RE, do i want to purchase a cheap property to rent, or should i put that same amount of money into a few REIT ETF’s? I ask this question rhetorically, as i already own most of the REIT ETF's that exist.

Instead of a mortgage, one can purchase a REIT ETF on margin. In lieu of monthly mortgage payments, pay down the margin monthly. The quarterly dividend would help as well.

Do you think a REIT ETF investment purchased today, can outperform purchasing a rental unit over the next 30 years?

What kind of REIT ETF do you favor (equity, mortgage etc)- and do you favor a REIT ETF over an actual property?

What say you?

*I prefer a REIT ETF's over any individual REIT- less risk, more diversification.

Open question to all:
REIT's or directo ownership?

I own the REM etf which has a hefty dividend.


Open question to all:

Wages as a percentage of corporate profits.

This chart paints an ugly picture.

Corporate profits are at an all time high, personal income and salary for the 99% is at an all time low.

Why the disconnect? 

The top 1% which include the CEO's directors, and upper level managers are siphoning more of the salary pie than they used to receive as compensation. 

What's left after the executives take the lions share is a tiny fraction. The small crumbs that are left are split amongst offshore workers that make pennies a day, and the American laborers that are forced to work for salaries that are barely above minimum wage.

Before the Ronald Reagan revolution- that was the beginning of the destruction of the middle class, executives in the 1% took 10% of the salary pie, now they take 40% of all wages. The middle class in the 99% now has 30% less of that salary pie to divided between themselves. Its even worse when you consider anther 20% of that income pie goes to workers in India and China.

Buy Gas just in case the Strait of Hormuz, and the Iranian Threat might be more than bluster.

If you can buy a few gallons, and store them away, that might be the ideal solution. This is certainly not the safest option or the most convenient for the vast majority.

For the rest of us, buying options is probably the way to go on Gasoline.

Take a look at (UGA) United States Gasoline Fund.

The United States Gasoline Fund, LP ("UGA") is a new way for investors and hedgers to manage their exposure to energy.

The United States Gasoline Fund LP (UGA) is an exchange traded security that is designed to track in percentage terms the movements of gasoline prices. UGA issues units that may be purchased and sold on the NYSE Arca.

I am not recommending you go out and bet it all on this. But, it might be prudent to hedge your gas costs against headline risk- just a little.

You can buy out of the money calls on UGA- take a look at the Feb 18 2012 with 51 Days to Expiration.

The 65.0 strike Call can be purchased for .10 cents.

If the Iranian scenario does go bad, gas is going to double, and those calls will be worth $2 to $3 bucks- each.

Spending $100 on these calls to protect your short term fuel costs is a modest proposal that could potentially pay off for the long haul.

That hundred you wagered could be worth a few grand if things go to hell in hand basket.

Dec 29

Two trades for today.

I want to sell the (FAS) Feb 18 2012 55 put for a $400 credit.
FAS is trading at 65.82
I am also going long the FAS Jan 21 2012 put (36 strike) for a .15 cent debit.



I want to sell the (UYM) Feb 18 2012 30 put for a $240 credit.
UYM is trading at 31.87
I am also going long the UYM put (17 strike)same expiration for a .15 cent debit.

They are both verticals, but the fas put is a calendar vert. The FEB puts on FAS are too rich for my blood at the moment.

I am willing to let the shares be put to me if need be.

I began in the investing world with $2,000

Today, my investing portfolio is worth over $100,000 as of December 2011.

I liken my investing style closer to Warren Buffet, but i am not opposed to the swing trade.
With this blog, i am going to try and give investing ideas on a daily basis, we can track how they do over time.

Lets begin.
Happy trading.

If you thought Bloomberg even had one shred of decency- think again.

A Living Wage, Long Overdue
Published: December 25, 2011
Published in The New York Times.

New York City provides hundreds of millions of dollars a year in taxpayer-financed subsidies to private developers. It is only right that the jobs created by those projects pay a decent wage. The Fair Wages for New Yorkers Act, widely known as the living-wage bill, would nudge these employers in the right direction.

Get that- middle class NYC taxpayers provide kickbacks to developers so that they can build fancy buildings for wall street big shots and others.

The bill now before the City Council would require future development projects that receive $1 million or more in discretionary financial assistance from the city to pay $10 an hour plus benefits for full-time workers and $11.50 an hour without benefits for at least 10 years. That may not be much, but it is an improvement over the minimum wage of $7. 25 an hour.

The benefits sound fair.

Mayor Michael Bloomberg is fighting this change, arguing that a wage increase might scare off new developments and cost the city thousands of lower-paying jobs. That has not been the experience elsewhere.

First off, $7.25 isn't a living wage in New York City, it hasn't been for years. Meanwhile, on the left coast, the other expensive city, San Francisco, just raised their minimum wage for ALL workers to $10.24 an hour.

Once again Bloombito is talking his book:
"But, if we don't give these fancy billionaire developers millions in kickbacks, they will build those penthouses that sell for 30 million in Cincinnati!
We can't make these job creators pay another 3 bucks an hour to poor people- that would cut into their tens of millions in profits."

Disgusting!

http://www.nytimes.com/2011/12/26/opinion/a-living-wage-long-overdue.html

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