Homes vs Stocks

This article was written by Mark Cuban with which I agree on this issue. You can find the original article at http://blogmaverick.com/2008/11/11/homes-vs-stocks/

By Mark Cuban,
So whats the difference between being underwater on a mortgage and underwater on a stock ? Is it that “experts” will tell you to hold the stock in hopes of it going up in value and then explain that those with homes worth less than their mortgages shouldn’t feel bad about breaking their mortgages and defaulting ?

I think “Buy and Hold” for stocks is one of the all time great marketing scams.

“Buy and Hold” for your house is a mantra you should always live by. The difference ?

You can live in your house. You get utility from your house. You may get a deduction for interest paid on your tax bill. You can develop a positive emotional attachment to a house.

A share of stock….well you can…you can look up the price anytime you want if you think thats fun. There is no utility of a share of stock beyond its financial value. The value of a house is that its your home.

The fact that you may be underwater in your mortgage is of no relevance if you can make the payments.

If you can make the payments on your mortgage, it shouldnt matter if your house is worth 10pct of your mortgage. If you can make the payments, make them.

My last house, (Mark Cubans house), I remember being freaked out watching as my rate on my Adjustable Rate Mortgage went up and up as I watched the value of my house go down. For 2 years my rate went up, my house value went down. Fortunately, I liked living there. I wasnt building any equity, in fact, I was negative, but I was going to have to pay to live somewhere. On top of everything, my credit was bad enough, I didn’t want to make it any worse. In fact, I knew that if I didn’t make the payments on my house, my chances of ever owning a house again were none and none. So I kept paying the note every month. In spite of the financial pain.

Then a funny thing happened. Interest rates started to go down. I didnt even know it until I got my annual notice saying that my mortgage payment would go down. The value of my house wasnt going up, but for the next several years, my payments went down. It took years, but I actually built equity in the house.

Which is exactly the point. Buy and hold works when it comes to the HOME you LIVE IN. Turning in the keys because you have negative equity is a fool’s game.

Your home has far more value than its mark to market price because you can live in it . Do whatever you can to stick it out. It will pay off for you in the long run.

Ode to the Onion - Pablo Neruda

Onion,
luminous flask,
your beauty formed
petal by petal,
crystal scales expanded you
and in the secrecy of the dark earth
your belly grew round with dew.
Under the earth
the miracle
happened
and when your clumsy
green stem appeared,
and your leaves were born
like swords
in the garden,
the earth heaped up her power
showing your naked transparency,
and as the remote sea
in lifting the breasts of Aphrodite
duplicating the magnolia,
so did the earth
make you,
onion
clear as a planet
and destined
to shine,
constant constellation,
round rose of water,
upon
the table
of the poor.

You make us cry without hurting us.
I have praised everything that exists,
but to me, onion, you are
more beautiful than a bird
of dazzling feathers,
heavenly globe, platinum goblet,
unmoving dance
of the snowy anemone

and the fragrance of the earth lives
in your crystalline nature.

Translated by Stephen Mitchell

Bennett Family

We took this picture a couple of weeks ago at Payson Lakes on the Nebo Loop. I love it.

Dog Monkey?

For those of you that know me really well, and for those that don’t, I have an addiction to reading the news on the internet. For some reason I feel I just have to know what is going on at all times. I really need to go cold turkey and just stop reading the news all together as Timothy Ferris says in the 4 Hour Workweek, but I haven’t been able to pull myself away from the internet goodness that is 24/7 news.

Today, I am glad I haven’t gone cold turkey yet. I read the craziest thing I think I have ever read from a politician in my life … that I can remember. Maybe I feel this way because I have gone over a day without any  sleep, but even with me being loopy these comments are just plain crazy. Check out this link for the full article at http://news.yahoo.com/s/ap/20080918/ap_on_el_pr/biden_taxes

Joe Biden, the Democratic Vice Presidencial Candidate said Thursday on ABC’s Good Morning America that paying more in taxes is the patriotic thing to do for wealthier Americans.  … “We want to take money and put it back in the pocket of middle-class people,” 

Noting that wealthier Americans would indeed pay more, Biden said: “It’s time to be patriotic … time to jump in, time to be part of the deal, time to help get America out of the rut.”

Is he serious? Did he really say that? Do they really believe that? Patriotic to pay more in taxes? This is the craziest thing I have ever read. I vaguely remember this as a Disney story, no not the one Matt Damon was talking about but the one, I think it’s called Robin Hood.  And sorry Matt, you aren’t Robin Hood in this story, you would be the one with your money getting stolen.

I would like to articulate my thoughts a little bit more but my brain is not working correctly at the moment. After I get some sleep in the near future… hopefully … I will say a little more of what I think about the Biden comments.

And, by the way, I love the picture above.

Race Pace Run 7.03 miles in Spanish Fork Time:56:36 - Rate: 8.5 - Pace: 8:03…grrrr

We had a great time at the Provo Veterans Memorial pool today. We took in some sun and had tons of fun on the water slide. Tammy, the kiddos, Tammy’s parents and her Grandma where all there. Broc loved the water slide while Bailey went down once and that was enough for her. I succumbed to the food stand and bought a piece of pizza, nachos and a pretzel. I wish I had more will power but the food was calling me by name.

For my workout I did a 7.03 mile run on the SF Memorial Day course. It was a little tougher than normal. I felt pretty slow and after looking at my times I was about 30 seconds slower than normal. I really need to get back on my training schedule.

Race Pace Run 7.03 miles in Spanish Fork Time:59:51 - Cal: 913 - HR avg: 181 - HR max: 199- Rate: 8.0 - Pace: 8:30

Medium Pace Bike 11 miles up to Payson and back Time:35:10 - Cal: 469 - HR avg: 167 - HR max: 180- Rate: 8.5

Once I got back home I pulled some weeds and was also able to get Mark Monfredi to come running with me. We did an easy 5k on course 1.

Medium Run 5k on course 1. Time:24:37 - Cal: 371 - HR avg: 180 - HR max: 196 - Rate:7 Pace: 7:55

I found a funny site called http://yearbookyourself.com/ where you can look into the past and see what you would look like through the decades. Take a look. Here are all my pictures from since 1950. Tell me which ones you like the best.