“EVERY act of giving results in receiving something. It might not be exactly what you expect, but you always get back in one form or another whether it be self gratification, or and actual physical item. Also, the more effort you put into you giving, the bigger the item in which you will receive.”

This is a law that goes for everything I’ve ever observed. I am sure it’s not something new, but just not taught enough.

If you want a better life, for instance, put more effort into living. If you want a better job, put more effort into looking. etc..etc..

Too bad we couldn’t hedge our gas prices earlier. If we could have, I know my wife and I would have bought $2000 worth of gas in January. We knew prices were gonna continue to rise then, but we didn’t have a way to do it. I heard some states have ways to do it, maybe California should look into it.

As much as I like Gold and Silver as investments, knowing what outside forces have an affect on the price but are not holding to the trend greatly concerns me. Hopefully it just means that someone out there (with a lot of money) is buying while the going is good (meaning that the prices are still cheap) and that’s causing the increase. I like seeing Gold prices increase, but only because I have most of my investment in it. I don’t like what drives the prices of Gold though, because it means that our nations dollar is weakening and so is our economy overall.

In the end, all any of us can do is take advantage of what we hope is another cycle for any investment that might be at t low point. GREAT real estate deals are all over the place now. Learn to negotiate and buy property at great prices, and you’ll be able to stay ahead of the economic problems most Americans are facing today.

Have a great Memorial Day weekend, and take time to learn about what’s going on around you!

A new report today says that wholesale inflation rose very slowly, slower than expect. (yeah right) The government tweaked the numbers so bad, it wasn’t even worth really publishing.

Gold is back on the rise, but oil will soon peak and interest rates will have to go back up. This means that Gold may not maintain the strong price rise, but I am thinking it won’t go much lower all in all and a slow “continuous” rise is probable for the long term.

Inflation will be the biggest enemy of everyone’s wallet. (beside the cooling cost to beat the heat) BUT all in all, there is always a golden shining light at the end of the tunnel. Real estate prices continue to plummet, and this gives many opportunities for those who know how to play it.

Read up on things that gained a lot of popularity during depressions or recessions, and there is a lot of opportunity to get ahead. Think about it….

So while here in Phoenix, I’ve been asking the locals (clients that I met) about the economy here and what they thought of the real estate market. Most said it’s a great time to move out here if I was looking to buy a house because foreclosures are rampant here like everywhere else and deals are easily found. Spoke to one long time local who told me of very interesting zoning laws out here regarding having office space that could double as a residential house. These properties are usually corner lots and must have adequate parking (I think he said 8 stalls) and must follow other specific rules that are pretty stringent but understandable. Those who live here love it, and don’t really feel the heat much. (I felt it!) I can’t imagine what it must be like in the middle of summer.

One other interesting thing. As I met with clients out here, I found a strong willingness for many people to give referrals for others who might like our services, even if they were competitors. Also, everyone seemed to know each other, like this was a small town of 200 people. With everyone so willing to share knowledge, it helps everyone move ahead and have a great outlook to their. I haven’t seen it anywhere else yet, but it should definitely be practiced by more industries.

I spoke to a women looking for some advice on her finances. She owns a nice place in France that she wants to fix and rent out. There is no mortgage on it, but the bathroom is unusable and she has no funds to fix it. I asked if she was willing to sell it now while the real estate market has not totally crashed yet, and she said she wants to keep it because it is so beautiful even though it’s unusable. I offered her a solution that would take some time, but help to secure her future.

1. sell the France condo (she might get $200,000 for it), then do either #2 or #3 below
2. take that money and find an apartment building to buy, use the $200k as a down-payment or closing cost OR
3. take the money and buy a few condos at $25,000 to $30,000 a piece and pay it all in cash so there would be no mortgages. (believe it or not, there are a lot of these places in the midwest)
4. She could also rent her house here and use the income to sustain herself in France as she fixes up the place. If the rent gives her enough income, she could sustain herself for a long time. (the weak dollar is a concern on running the actual number that she would have to consider)

Investing in real estate has its risks, I am well aware of that. I’ve made my mistakes and had my homeruns. The key is knowing who to get help from. Success is usually done when good team is put together. Spend the time to find good professional help, and your risk goes dramatically down, and success rate up. I think referrals work best in finding good team members, but so does asking a lot of questions to see how they answer. A combination of getting a referral and interviewing them is even better.

Don’t forget to educate yourself as much as possible. The more you know personally, the better you’ll be able to see “red flags” in a deal. The future is yours to make and mold, you can’t do it by praying God drops everything in your lap.

Are you ready to buy? Take some time and do some work in learning about real estate. There are thousands of books out there for you to read. If you are tight on money, don’t forget that books can be borrowed for free at the library. If you don’t like to read, do what I did and start with borrowing the smallest books first, then as your vocabulary grows, so will your reading speed. If money is not an issue and you don’t want to read, go purchase a couple of cd or tape courses and turn your car into a rolling university.

Bottom line…get prepared and get educated. The news is pointing to a dramatic opportunity for those who understand how to take advantage of this change in the real estate market. You’ve got a couple of years to get ready, don’t waste it!

Anyway, on one of our many walks (I am so paranoid the dog will relieve herself in the house, I take her out every 2.5 hours just to be sure she stays on empty), I went to see an open house in my condo complex to see how much property values have dropped. Here is where we can see what’s really going on in our Southern California area. Real numbers…

A 3bedroom/2bath condo that once sold for $330,000-$350,000 was now on sale for $219,000 and another for $199,000. That’s over a 33% drop in prices when you factor in that the realtor said we could probably negotiate even lower if we wanted too.

Most recessions follow the real estate and construction markets. Right now, with real estate dropping so rapidly, our construction industry is following suit. With this happening, rest assured that it won’t be long till it seems as though construction is at a halt. The real estate investor pros are preparing for the next boom coming. It won’t be for a few years, but when it happens, they’ll be jumping in and waiting to become exceptionally wealthy. For now, money is going into hiding. Some of it seems to be moving toward the stock market, but I don’t think it will stay there long. The stock market is unforgiving, and when a little negative news comes out, it reacts fast and hard. The gold market has also shown to be extra volatile, but the world is going to be dependent on it to hold value, so I am personally confident many wealthy people will continue to shelter their funds into this precious metal.

The good news is that oil prices are on their way down. However, I saw that OPEC will make sure that oil prices does not go below $85 or $80 a barrel. I think we might hear an announcement that OPEC may be planning to cut production soon. If that happens, we can expect even more volatility on our markets.

I am hearing very disturbing opinions of where people think our country is headed and also what they predict will happen soon. The general public does not pay attention to the “real” news out there, or they think it doesn’t apply to them. The news of Bear Stearns needing to be bailed out today should be a real concern to everyone. If the nations 5th largest investment bank can have such an emergency that the Federal Reserve and JP Morgan Chase need to bail them out of their financial problems, it’s just another sign that needs to be taken seriously. How much can the Federal Reserve really do to save our country if all our big investment firms start to collapse from mistakes made? Our FED knows that they are on the verge of causing hyperinflation. To save bad financial institutions with bail out money is necessary to prevent a run on the banks, but what will it cost us in the long run?

I predicted that Gold would do a pull back today, which it has…but not nearly as much as I think it should be pulling back. Those who are selling are also being offset by a lot more people buying in, so gold is almost stable right now. That’s scary…It means that confidence in our dollar is sinking more and inflation is about to probably get ready to pounce hard
on everyone.

***MARKET THOUGHT OF THE DAY*** Here is a little bit of news I am passing on some investments that should weather the storm of recession pretty well. BUY into Storage Facility Companies. Do your best research into each company first. Make sure they are solid in their balance sheets. The reason for the gains in these industries will be coming from those who get foreclosed on and need to take their stuff out of their homes to downsize. I am thinking this is a good theory, but I am not sure if people going through foreclosure will have enough money afford a storage place. What are your thoughts?***Disclaimer: I am not a “professional” and do not have a license to give advice and could be totally wrong in all my predictions or my feelings. If you decide to take my advice without doing your own research, that is not wise, and not recommended. Trade at your own risk and know that most individual investors (something like 90% +) lose money investing in the stock market.***