How aggressive are you these days?

duecescracked, you're right, a pic would be funny, but it would probably involve me on the wrong side of some untoward event, like being shot.

How anybody could possible get so upset with me for saying prices will fall is beyond me. I admit I enjoy the entertainment - much more fun than computer documentation from Brazil that I'm working on, or oil wells that I'm working on next - but I don't take any of it personally. And I CERTAINLY wouldn't challenge someone to a duel over it, which is in effect what Malraux is doing.

I do remember in the dot.com bust how angry people would get when their stocks kept on falling in value and they wanted them to rise. And they rode the wave all the way to the bottom.

the point is that you were called out to back up your prognostications with REAL money, and you are backing down

face it - you're owned

and for the 10th time - how are you betting "millions" on housing prices going down? or was that just another "joke" (read: lie)

well, the beauty is steve, you don't have to meet malraux. Just a lawyer in charge of the escrow. You can both remain anonymous. Something tells me that you would never do that though.

steve, what do you know about the art market? Any good deals out there these days?

Nothing about the art market, JuiceMan. Nothing.

I would never meet malraux in person, and I have no need to do anything but laugh at his preposterous proposal to bet on the future per-square foot price of an apartment that I had never seen and that he would be unwilling to sell anyway to see what it was worth. If I wanted to trade on housing prices, I'd just follow this:

"NEW YORK, Feb. 27 /PRNewswire/ -- Standard & Poor's, the world's leading index provider, announced today that it has licensed Bear Stearns to trade over-the-counter (OTC) contracts based on the S&P/Case-Shiller(R) Home Price Indices -- the industry's most widely followed measure of U.S. residential home prices."

Ironic that BSC was the licensee of this product, no?

No, evillager, it's true: I'm betting that prices will fall by putting my money elsewhere, in assets that I think will rise more (emerging market stocks). Eventually I'll buy again, hopefully with more money to invest and lower home prices.

And no, evillager, I wasn't "called out." I would never engage in such a silly bet, tying up $45,000 for 2 years making virtually no money on it. If I really wanted to invest in housing derivatives - which is what that bet essentially is - I'd do it through contracts.

weasel-boy: Just wait - "watch for a 25% price decline in 1 year, 50% in 2. Malraux bought 'in the Village was August 2007. Top of the market. Seems like a move to me. Listen to him."

Malraux: "I'll make you a bet, because you're such a bully on these boards, and have such a big fuckin' mouth. Since you're forecasting a "...25% price decline in 1 year, 50% in 2....," I'll take you at your word. Here's the bet - if the terraced Village penthouse I bought in August 2007 goes down 25% from $1,200 psf (the buying price in August 2007) to $900 psf by August 1 of this year, I'll give you this penthouse, title clear. Alternatively, if it goes down 50% to $600 psf by August 1 2009, I'll give you the place, title clear - your choice if you want to take the 1- or 2- year bet. If you're wrong in either case, all you lose is a modest cash amount equal to two months of your (supposedly $1,500/day) earnings."

weasel-boy: "don't think the price will fall that quickly - $900 psf by August 1, 2007. Nor do I think it will fall to $600 psf, ever." (BACKPEDALING ALREADY FROM ORIGINAL COMMENT). "But the price will fall. My guess is to about $800 psf, which would be the 2004 price."

Malraux: "OKAY, STEVE, I'LL TAKE THAT BET!! As I said above, I'll put my knowledge and experience in Manhattan residential real estate toe-to-toe with yours. So I'll out my terraced penthouse unit on the table, fee- and title- free to you if the place is valued at or below $800 psf on 1 January 2010. If it's valued above $800 psf, you lose, and give me two months of your-supposed-$1,500-per-day income. Again, it's a super sweet deal for you."

weasel-boy: "I said average prices, malraux" (OHHHH, HERE WE GO AGAIN, MORE BACKPEDALING).

Malraux: I will now bet you two month's of your pay (calculated at your supposed $1,500 per day income level), or $90,000, that you are wrong. And just to be super clear, we're talking, according to your previous post, about '...I said average prices, malraux...' And by that I take you to mean the average price of residential Manhattan real estate. Should we say ALL of Manhattan, or should we select a prime grouping area, like all residential real estate south of 96th Street? So, therefore, you say the AVERAGE price of Manhattan residential real estate will be down 25% in 2008, and down a TOTAL of 50% by the end of 2009. I'll take that bet steve, for two months of your pay. If Manhattan residential real estate ON AVERAGE is down 50% or more by December 31 2009, you win the bet. If Manhattan residential real estate is down LESS than 50% ny December 31 2009, I win the bet."

weasel-boy: "I'll take the bet, malraux, but April 9, 2010: prices down 50%. To make it easy, take the West Village. Current median psf: $1,633. $800 on April 9, 2010. Or all of Manhattan: $1,182 median psf. $600 on April 9, 2010. Take your pick." (SO NOW IT'S ALL OF MANHATTAN AND/OR WEST VILLAGE, NO LONGER MY PLACE, AS PER WEASEL-BOY'S BACKPEDALING ABOVE).

Malraux: "Assuming the source is one we both agree on, I'll take BOTH bets, steve. Just tell me exactly how you want to escrow the $'s."

weasel-boy: "Which irrevocable trust will you sign your deed over to? Unless it's a co-op, then you're going to have a problem." (ALREADY TRYING, IN ADDITION TO BACKPDALING, TO CONFUSE AND OBFUSCATE THE ISSUE).

Malraux: "We're NOT doing a point-to-point bet on my place (according to you), but overall AVERAGE MANHATTAN PRICES and AVERAGE WEST VILLAGE PRICES, right? Since the bet isn't about my place (even though that was your initial inference, being that it was the next sentence in your post above), now the bet is dollar for dollar on AVERAGE prices dropping from today's date, according to you. But wait - now we see that first you wrote 'I said average prices, malraux' and now you're talking MEDIAN PRICES! Wow, steve, can you give anybody here a straight answer, or are you just a lying sack of shit? First, it was MY place, then it was AVERAGE prices, and now it's MEDIAN prices."

weasel-boy: "Malraux, please: I didn't even know you had any particular apartment in any particular part of the city when I said you'd bought at the top of the market, so drop it.' I told you what I would bet on: median $psf either for the West Village or all of Manhattan, on April 9, 2010. I cannot tell you what your apartment - which I know nothing about - will be worth, nor will you know without selling it, so that's a dumb bet. (YET HE'S STILL TRYING REPEATEDLY TO BRING THE UNIT BACK INTO THE BET). And when I wrote "median" I KNEW you were going to attach yourself to that."

Malraux: "Amazing, steve. So your direct quote above 'I said average prices, malraux' was - wrong? A lie? An idiotic comment? Okay, fine. we'll go with the streeteasy numbers. So my understanding is that on 9 April 2010, MEDIAN housing prices in Manhattan must be at or below $600 psf or below according to streeteasy. On 9 April 2010, West Village MEDIAN housing prices must be $800 psf or below according to streeteasy. If not, you lose the bet(s). Period. So just tell me where you want to set up an interest bearing escrow account. You will deposit $45,000 per bet, and I will deposit $90,000 per bet. It's easy, easy money, right steve? After all, remember, you're betting MILLIONS anyway, so this should be like gravy on top of the millions you'll earn."

weasel-boy: "Name the spot for the escrow"

Malraux: "Danziger, Danziger & Muro, LLP, 405 Park Avenue, Suite 502, Monday morning, 4/14, you name the time, I'll make the appointment."

weasel-boy: "Sure, 10 am."

Malraux: "Good for you, weasel-boy. Now you can out your money where your furry little snout is."

weasel-boy: "BTW I asked my attorney to review my threads. My attorney advises me to hold you to your original bet. I would never bet on the future per-square foot price of an apartment that I had never seen and that he would be unwilling to sell anyway to see what it was worth."

Oh, malraux, you do make me laugh! Just because you're nuts doesn't mean that I am. I daresay that if anyone does read this, they will crack up.

Tee-hee-hee.

Oh, and weasel-boy, as to your ridiculous assertion -

"And no, evillager, I wasn't 'called out.' I would never engage in such a silly bet, tying up $45,000 for 2 years making virtually no money on it."

Weasel-boy, are you saying you wouldn't tie up $90,000 for two years knowing it return $270,000 into your pocket (including initial invetment) in two years? We all know that you don't average 45% per annum before taxes on your investments, weasel-boy. If this was such a 'sure thing' to you, you would be stupid NOT to take the bet, being that I offered you a 2-1 payout if I was wrong.

So now you've proven not only were you 'called out' for your assinine opinions that you won't even back up with action, you were also 'called' out for financial stupidity on a (supposedly sure-thing) bet.

Looking forward to seeing you Monday, weasel-boy.

Or should we make it easier on you? I'll bet you $5,000 toe-to-toe, streeteasy holding the dosh, if THAT somehow makes you more willing to participate. How about that? Did the big, bad numbers scare you, weasel-boy?

And since you LOVE to quote from wikipedia, weasel-boy:

http://en.wikipedia.org/wiki/Weasel

ENJOY!!!!

Malraux, that's HILARIOUS! Thanks!

Other thank the wikipedia thing, I've actually stopped reading what you write and only skim it, because they're becoming more and more absurd.

But since you agree that wikipedia is fun, how about this:

http://en.wikipedia.org/wiki/Psychosis

I'll cut to the chase, though:

"Psychosis is a generic psychiatric term for a mental state often described as involving a "loss of contact with reality."

And my stock market investments made 60% last year, but we documented that elsewhere.

All good points malraux

Also, putting your money elsewhere isn't the same as betting house prices will go down. I'm sure you still won't shut up, but I am very pleased at how you have been exposed

Now fix that friggin laptop already

"Other than," I meant to write.

No, weasel-boy, you MEANT to write that you're "an idiot - a coward who won't follow through on his big mouth."

You've been called out. So am I to assume that there's absolutely no way you'll show up on Monday? Am I also to assume that you won't even take the bet at the much, much lower $5,000 level I proposed above?

Okay (sigh), what about $1,500, with streeteasy.com holding the money? Just so that I can have the pleasure of showing what an idiot you are in two year's time? SURELY a man who claims to make 60% on his money per annum would part with one day's wages, if nothing more for the pure enjoynment of not looking like a little bitch in front of all the other people following this thread? C'mon, weasel-boy, or trust me, NOBODY is going to believe ANYTHING you have to say about what you earn, what you return, or your market opinions ever again. One day's (supposed) pay. That's all.

Here's what I was invested in last year:

DXZLX

I'm a far better investor than your silly little (psychotic) bet would mean.

If I really, really wanted to make a bet like yours, I'd merely trade in derivatives against the Case-Schiller index. I'll make a lot more money a lot faster than you will invested in NYC real estate.

Unless you agree with MightyJuice that now that BSC has been taken over by JPM, they're going to hire hundreds of new computer people to integrate their systems, rather than firing them all, because that bet will make you even MORE money!

BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH (I'm a little weasel) BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH (I neither really believe in the opinions I offer nor will I back them up) BLAH BLAH
BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH (I will try to use misdirection and backpedaling wherever and whenever possible) BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH (now I won't even talk about the bet but I'll offer financial information to try and distact you) BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH

Here's what I invested in this year -

WESLBOY

Don't you get it weasel-boy? If you won't even take the bet at $1,500, we all KNOW you're full of shit. Your ideas, your posts, your everything. So glad you did a quick bit of websearch and threw out the name of a something that you saw did well last year, and told us all taht you were invested in last year - you think anybody really believes you now? If you won't put your money where your mouth is actually (and only $1,500 of it, at that), we all KNOW you're a liar. We all KNOW you're full of shit. DO you think anybody reading your last post takes you seriously anymore? When you can't even scratch together $1,500? Supposedly "just a day's pay?"

"I'm a far better investor than your silly little (psychotic) bet would mean." Oh, boo-hoo-hoo for you, weasel-boy. I bet you're such a good investor, SURE you are. We ALL believe you! You're a GOOD investor! Yes you are!

$1,500, weasel-boy. Or you're just a little bitch.

What is this "WESLBOY" that you invested in?

I think you should invest in anger management, instead. BLAH BLAH BLAH BLAH

$1,500.

Just a day's pay.

Or you're just a little bitch.

Maybe it would best if you didn't post anymore on this thread, weasel-boy.

hey steve, check out this new development. being offered at $2k psf

www.211elizabeth.com

do you really think you will be able to buy something here for $1k psf in 2010?

moron

hey steve, I'll double malraux's bet if you can find the statement "they're going to hire hundreds of new computer people to integrate their systems" in any of my posts. I know you won't take that bet, because you won't be able to find that statement. You made it up, just like most of the content in all your other posts.

I understand you have had a tough day and feel pretty foolish, but don't take it out on me. You've over played your hand (again), now deal with it.

Yes in fact I do think that that's exactly what properties will be worth: 2004 prices. Because who, pray tell, is going to buy this 9.8 month and increasing supply of apartments, when Wall Street is being decimated?

And Malraux, I've averaged $30,000 per month so far this year. Do the math: 2080 work hours per year x $175 per hour net, no expenses. It's been a good year, because usually I don't start to get busy until May.

I'm sorry you hate me. But I don't really mind. ;0

Actually Juiceman, we ALL know weasel-boy won't take the bet because:

1. he'll find some way to weasel out of what he said before, just like he tried (unsuccessfully) with me.

2. he'll try to distract you with other random financial data and quips so that you start other arguments him and don't stay on the initial point.

3. he's been called out and served.

4. he won't even cover a $1,500, "just a day's pay" bet.

If he's really smart, just for once, he won't post anything else on this thread again.

JuiceMan, I've actually had a great day and I recognize that you didn't say that. You said something like 2 years, lots of IT people, minimum. But I was having fun. You know, drama queen. ;)

I never overplayed my hand - I never had any intention of taking a stupid bet with someone who comes across as psychotic. Like: BLAH BLAH BLAH BLAH BLAH.

Oh, how interesting.

weasel-boy: "I'll take the bet, malraux, but April 9, 2010: prices down 50%. To make it easy, take the West Village. Current median psf: $1,633. $800 on April 9, 2010. Or all of Manhattan: $1,182 median psf. $600 on April 9, 2010. Take your pick."

weasel-boy: "I told you what I would bet on: median $psf either for the West Village or all of Manhattan, on April 9, 2010."

weasel-boy: "Name the spot for the escrow"

Ohhhhhh, so NOW you tell us that "I never had any intention of taking a stupid bet" (and actually expect us to believe you?) - so you're just a common, everyday liar. How nice! Makes us all wonder what ELSE you might be lying about on all these streeteasy boards that you spew with your loghorrea.

"I never overplayed my hand" And if you believe THAT bit of self-puffery, then you are sadder and sorrier than any of us ever imagined you to be, weasel-boy.

If you're really smart, just for once, you won't post anything else on this (or any other) thread again.

Sorry you don't like my posts, malraux. I'm still waiting for evidence from Juice about how long it takes to integrate IT platforms or what he bases his 0.5% interest rates in 7 yaer, I'm still waiting for ccdevi to tell me what was wrong with my explanations of why Manhattan real estate is overpriced, I'm still waiting for lots of things.

I know you're upset because I keep on proving to you that prices in Manhattan rose by 100% in 4 years, an unheard of rate in the history of the world, and entirely unsustainable on anything but fantasy.

You can tell my intentions when I said I had my lawyer review the threads. For real, malraux, you're weird.

But fun to play with. Like a little toy.

stevejhx your writing skills are far superior to your social skills. This is something you can get treatment for as long as you recognize this. You have a mild case of Aspergers. You need to see a doctor for your own good. here are some of the symptoms.

(1) encompassing preoccupation with one or more stereotyped and restricted patterns of interest that is abnormal either in intensity or focus
(2) apparently inflexible adherence to specific, nonfunctional routines or rituals
(3) stereotyped and repetitive mannerisms
(4) persistent preoccupation with with certain subject matter
(at least two of the following)
(5) inability to interact with peers
(6) lack of desire to interact with peers
(7) lack of appreciation of social cues
(8) socially and emotionally inappropriate behavior

Thanks, Spunky! I'll forward that to my psychiatrist, psychologist, social worker and hypnotherapist, ask for their opinions.

But if I'm all of those things, and you keep on posting, "just out of curiosity do you think one is better off renting or buying in todays economic climate?" do you think you might suffer from it, too, and could you point me toward a support group?

Does malraux's "BLAH BLAH BLAH BLAH" also count as a symptom?

Now then, since I just got back from California visiting my good friend of 25 years, and just got off the phone with another good friend of about 10 years, and I just got an email from my good friend of about 35 years, I'm hungry and am going to have some dinner.

"Sorry you don't like my posts, malraux. I'm still waiting for evidence from Juice about how long it takes to integrate IT platforms or what he bases his 0.5% interest blah blah blah blah blah blah blah blah....(honestly, people, have you ever heard/seen such utter and total spew in someone's postings?)" It's not your posts, per se, that we don't like, weasel-boy. It's the fact that you're a liar with no integrity or sense of personal pride. You won't even go toe-to-toe for $1,500 (ONE DAY'S PAY, RIGHT, WEASEL-BOY?) to put your money where your mouth is. You're pathetic.

"You can tell my intentions when I said I had my lawyer review the threads." Yeah, believe us, we can surmise ALOT about you from your posts on this thread, weasel-boy.

"Now then, since I just got back from California visiting my good friend of 25 years, and just got off the phone blah blah blah blah blah blah (as if anyone actually cares - what an idiot)." Enjoy your dinner, weasel-boy. But there won't ever be enough food to wash out the bitter taste in your mouth of being a liar, of overplaying your hand, of being caught out for the phony you really are. An utter, 100%, 180 degree, complete, and total reversal - running like a dog with its tail between its legs ki-yi-yi-yi-ing all the way home.

If you're really smart, just for once, you won't post anything else on this (or any other) thread again.

Oh, malraux, I live for this!

Here's my prediction, once again: within 2 years property down to 2004 prices, which have doubled since then, indicating that they will fall 50%. I've never strayed from it (except I brought it forward in time), never will.

Again, here are my reasons why:

1) market rents indicate a 50% fall in home prices based on out-of-pocket cash flow rent vs. own (historically 100% correlated)

2) 40x rent / 28% total household income ratio to rent/buy during a time of falling incomes means rents must fall and property prices must fall with them

3) historically constant 12x p/e ratio for rental versus 24x or more current

4) Manhattan property prices are nearly perfectly correlated to bonuses, and Wall Street bonuses are falling dramatically

5) significant layoffs in Wall Street (Bear Stearns (obvious), Goldman (announced), Merrill (announced 10% of non-brokers), Morgan Stanley (announced), Lehman (announced), not to mention CITIGROUP (about to implode)). Those firms are the engine of the NYC economy.

6) falling market rents

7) reduced leverage in the form of higher mortgage rates for jumbo loans, restricted access to loans with less than 20% down, restricted access to ARM's (especially jumbo)

8)current 9.8+ month supply of apartments on the market now and growing at the rate of about 100 per week.

9) new regulations on mortgages and investment-bank leverage

10) new jumbo loan guarantees don't apply to co-op loans, a significant portion of the Manhattan market.

11) ample availability of rentals either through market-rate buildings or subletting condos.

12) virtual elimination of rent stabilization in Manhattan as new units become vacant, increasing market-rate competition.

13) last year's sales were 50% above normal sales levels in Manhattan over the prior 9 years, which were above normal for the supply.

14) 30,000 units permitted in Manhattan over the past three years, much of it yet to come on line.

15) increased market transparency (through this website among others)

16) Manhattan is not "special," and is not exempt from market forces.

17) etc.

That's what I base my prediction on. The market is overbought. All indicators point in that direction. All indicators point toward a rapid decline, just like in the rest of the country where - over a longer period of time - prices shot way above their fundamental support level, and are collapsing - albeit at a slower rate than I predict for here.

Now, rather than publishing things such as:

1) WEASEL-BOY

2) phony

3) bitter taste in your mouth of being a liar, of overplaying your hand

4) BLAH BLAH BLAH BLAH

because I won't agree to your bet - which I never would have: I have better things to do with my money, like invest it and wait till real-estate prices come back down to normal - why don't you address the fundamental factors I've stated as my case, and refute them, one by one?

Because you can't. Ha-ha: you're invested in an asset whose behavior you understand nothing about, and you're about to get burned.

Unless you can explain your theory as to what fundamental factors support these prices, and base it on empirical evidence and accepted economic theory.

But you can't. Ha-ha.

|:0

Oh. My. God.

Have ever seen such a total load of pathetic crap?

We don't CARE about your personal "theory as to what fundamental factors support these prices, and base it on empirical evidence and accepted economic theory." You must actually think we care. Why are you viewed here as a laughing-stock, a pathetic over compensating weasel spewing (my god, look at that pile of crap you wrote above, when you said you were actually going out to dinner) detrirus all over this board? Oh you "just got an email from my good friend of about 35 years, I'm hungry and am going to have some dinner?" OOPS - another lie! - you're still here!

Because with two small, simple words, I can bring your logorrehic posts, such as the one above, to a profound and screeching meaningless heap. With two simple words, I can catch you as the liar you have proven yourself to be, of consistently overplaying your hand, of being caught out for the phony with no integrity that we now know you really are. You know what those two words are, weasel-boy?.....

"wanna bet?"

As I thought!

No answer = no clue.

Stevejhx do your imaginary friends play with you all day on the keyboard.

weasel-boy, if you really believed I had 'no clue,' you would have taken a bet that returned 45% to you per annum (and that doesn't include the additional interest!). Any reasonable person would take a bet with that kind of return. But you choose not to. It makes us all wonder why.

And then when I reduced the bet to a simple fun amount of $5,000, you still said no. It makes us all wonder why.

And then when I reduced the bet to $1,500 (one day's pay - RIGHT), you STILL said no. It makes us all wonder why.

As I thought!

weasel-boy = pathetic, lying, over-compensating, phony with a total lack of integrity.

Just like that dinner you said you were having (...yawn...). Yet another lie. This thread isn't about my 'answers,' weasel-boy, and your attempt to deflect your own idiocy at being caught out and served for the laughing-stock you now are is so very, very lame. This thread is about you, your opinions, and you total and utter failure to back them up with even the smallest amount of cash when your feet were held to the fire. Stop embarrassing yourself with your lame attempt(s) at distraction and mis-direction. It makes you look more like a fumbling oaf than you rally are (if that's even possible).

Or would you like to place a little wager on your so called "answers" above, hmmmmmmmmm, weasel-boy?

Oops! I thought not......

Stevejhx --- I finally couldn't sign the contract for the place I'd picked. It was perfect --- I thought --- but then I got cold feet. My one bedroom place is finally in contract and the closing date set for mid-June, but I'm suddenly very, very indecisive about which new place to go for. I'm selling a one bedroom pre-war coop and I need/want a 2 bedroom pre-war coop ----- and, OK, I'll tell you the location --- Hudson Heights. It's a great area and works for me because I do a reverse commute to lower Fairfield Co., CT.
Here's my problem: there are MANY attractive 2 bedrooms on the market, and I am now trying to decide among five of them. In the meantime, more go on the market, and the prices are softening.
So in answer to the OP, I am finding that I can be pretty blasted aggressive in my bidding, and . . . I have had a handful of agreed upon prices, but then I get cold feet!
Blast. I wish I'd just fall in love with one in of the places, but that's not happening. And it might not happen. There are a bunch of good possibles . . . . and there's no pressure to hurry. It's kind of interesting . . . .
I've seen a lot of nice places. The realtors are being pretty realistic now, and I'm not at all hearing "there's another bid coming in" tho I was hearing it a few short months ago ------- and all those places are still on the market.
So ------ I finally begged my college age son to come and look at some of the places with me, because the 2nd bedroom will basically be for him, but he flat out refused to go and look: "I know you pick good places ------ go ahead and pick the one you like best."
It's kind of a delightful dilemma but also somewhat nervewracking . . . ..

So, yes, the market is quite soft up here in the hood. It's a buyers' paradise . . . . . . and it's the home of Brian Lehrer, Laurence Fishburne, etc. And (for what it's worth) it was listed as the one of the ten best urban places to retire in the U.S. in Money magazine. And I'm beautifully middle-aged, so I plan to just live in this neighborhood (Hudson Heights) forever. It's very livable, quiet, gorgeous parks, city zest, hood-cred, etc.

I read the other day that Hudson Heights is not so great. Isn't that place part of the Bronx.

Please forgive me for pulling the discussion away from Malraux, but he's being a bit of a frother and in fact sounds like he's about to burst a blood vessel.

I have been following this thread and many others for a while now. I think Stevejhx is very credible.

He sources his research. He makes clear what his reasons and opinions are. I can point out flaws in the research. I can disagree with his conclusions. I can point out reasons why it may not apply to Manhattan. However it is fact and reason based.

His posts are logical. And if anything the fact that he is compulsive gives additional reliability to to what he presents. I believe he adds tremedous value to my decision making process for purchasing a home in Manhattan.

Pez you've been a militant RE bear on this board for the longest period of time on on this board why would you not think otherwise.

Spunky, Spunky, Spunky. Your ignorance of NYC geography is appalling!
Pez, I agree wit ya!!!!!!

just kidding poorrishlady. It's really groovy there. I remember seeing a lot of lava lamps near the windows and people smoking weed there. What a cool place.

I also believe there are a lot of hippies, yippees and yuppies there as well.

If by bear you mean looking at the evidence and concluding that real estate in Manhattan can't have double digit appreciation each year forever without leveling off at some point unless wages also increase than you are correct. Regarding the term militant that does not make any sense.

Oh, Spunky . . . . are you just a classic old fart, or what?
Yes. Classic old fart. That must be it.
But you are slightly humorous, too.
Pez ----- you should be PROUD of being a militant RE bear! Wear it as a badge of honor.

poorishlady, ganga good in the Hudson Heights maan. You be lookin for a solarium wit u pad?

Poorishlady, I was all expecting to be wined and dined, and now this! LOL.

Hey, if you're uncertain, that's a good thing. Listen to your gut. If you love a place & you KNOW it's right for you and want to go for it for the long-term, do it. In the meantime, check out nybits.com just in case you want to rent for awhile. Renting is not a bad thing, enjoy your newfound wealth, have a nice place for your son, entertain your friends. Life is good.

For the first time in years there are OPTIONS in NY real estate. That's the way a market should be. There should be choice. Real estate shouldn't be like Beanie Babies or Tickle Me Elmo: BUY IT NOW OR YOU WON'T GET ON ON THE LATEST CRAZE. If there's a boom there's a reason for it - ignore it. Watch Fast Money: buy on the dips.

We're in for a long-term downtrend in Manhattan real estate, to compensate for the hysteria we've seen not only in the past 4 years, but in the past 10. All driven by excess leverage and unregulated lending. But it's over.

Proof of being over is the way I get answered by malraux and juiceman and spunky and all the rest: they can't argue against me because there is no argument against me. Hey, you might disagree with my percentages - I can't prove them either, just based on how I do the calculations - but the TREND is unmistakable: back to earth.

The equations are timeless:

OUT-OF-POCKET MARKET RENTS = OUT-OF-POCKET OWNERS' CARRYING COSTS
OUT-OF-POCK MARKET RENTS = ANNUAL INCOME / 40
ANNUAL INCOME / 40 = 28% INCOME IN TOTAL HOUSING EXPENSES
PURCHASING PRICES = MARKET RENTS * LEVERAGE
P/E FOR HOUSING = 12x MARKET RENTS.

These are timeless ratios. Malraux thinks that because I won't "B-b-b-b-bet!" with him - compulsively, a la Fred Flintstone - that I don't believe it. I don't bet with him because I won't waste my time with an ant, who can't think deeply enough to tell me which of the above equations is wrong.

Because none of them is. They're ALWAYS that way, and they are merely different ways of saying the exact same thing: purchase price = annual income / 12 (p/e ratio) * 40 (monthly rent / income ratio).

Moreover, do it yet another way: 40/12 = 3.3. In the olden days, with a 30-year fixed mortgage with 20% down, you could get a mortgage for between 2 and 3 times your salary. Or when you add taxes and all other expenses, approximately 3.3x for total housing expenses. So if you make $100,000 a year, you can get a mortgage of between $200,000 and $300,000, depending on the interest rate, taxes, etc. Remember when it was like that?

Any way you calculate it, the result is always the same: 12x annual rent = purchase price = 28% of income as total housing expense.

You have a wise son, and you should be proud: indirectly, he told you it was your decision and you should make it when you feel comfortable with it. You should be proud of how you raised him: he's he and you're you. You should be thankful that he doesn't resort to calling people weasels with furry little snouts, because they disagree with him, and with good reason.

steve writes: I never overplayed my hand - I never had any intention of taking a stupid bet with someone who comes across as psychotic. Like: BLAH BLAH BLAH BLAH BLAH.

Just out of idle curiosity... does your assessment of Malraux's mental health have anything to do with your refusal to take the bet? Or was that simply a gratuitous insult?

I don't take a bet because I have no reason to take a bet, with malraux or anyone. I've never been to Vegas, never been to Atlantic City, never even been to Reno.

But look at the facts. Let's say, for instance, that instead of falling 50%, the average (median) price falls 49%. I lose the bet, but I win the war. Or 48% or 47% or 46%: I lose the bet, but I win the war.

Do you see why no one would take a bet like that? All Malraux - or anyone - would have to do is add a very expensive fake listing. Or if a new luxury building opens up that skews the median, it has the same effect. That's why that bet is unacceptable to any wagerer, even one who doesn't wager like me.

Malraux comes across as nuts, and I would absolutely, positively never meet him in person. But it has nothing to do with a wager. A wager has to do with odds, and absolute results. I would no more bet on snake eyes than I would bet that property prices will absolutely fall 49% or 51%. I will bet that they will fall, and fall significantly, but I will not bet on snake eyes.

Only a loser would do that.

You people need to learn how to invest, how to trade. Take half your profits when the taking is good, even if you might - MIGHT - make more in the future. No one knows the future, me included. We can surmise, however, general directions. That's what I've done, that's what I think. Will I wager on it when one new $50 million apartment in the city can skew the result? Absolutely not.

Six paragraphs? It would have been easier to just say it was gratuitous.

That said, I'd guess that the luxury building argument works in your favor. Right now, you've got The Richard Meier buildings, Superior Ink, and Palazzo Chupi skewing the market. Do you really believe anything is going to come online between now and 2010 that can offset the anomaly of three apartments selling for $8000/sq ft?

Oh, and, I'll bet on snake eyes all day long if you give me 40-1.

Yorick, correction: I'd bet on snake eyes at 40-1, too, provided that:

1) Someone would give me those odds
2) I could roll all day.

But no one would give me those odds since they exceed the chance of actually rolling snake eyes (1/36), and malraux's bet was, essentially, one roll of the dice.

Would you bet on snakes eyes under malraux's hypothesis: 2-1, 1 roll? Methinks not.

If you remember the episode, that was the downfall of Fred Flintstone. Wilma had her own downfall: CHARGE!

The first part of your question - I have no idea what people will try to offer in 2 years. They could convert another Central Park South hotel. No idea.

Steve, please. You obviously don't understand statistics as well as you think you do, or want people to think. For one, 40-1 odds on snake-eyes should be taken under any scenario, why would someone have to let you roll all day? What kind of idiotic statement is that? If you were able to roll all day you have a guaranteed win.

Secondly, you are comparing your real estate bet with '1 roll'? Your aborted bet wasn't exactly a random draw was it? You have been mouthing off for a month on these boards about how certain you are that prices would fall to 2004 levels, backing it up over and over with the same rehashed motivations. But when it came time to actually put your money where your mouth is and show the courage of your convictions you folded like a weakling. And don't even try the excuse that you didn't want to meet malraux, this could very easily be arranged without any personal contact.

Have you ever heard the expression 'talk is cheap'? Never has this been more true. It costs nothing to engulf these forums with all manners of predictions and mad conjectures. But what do you REALLY have riding on the outcome of your opinions? ZERO. NOTHING.

by the way, you can add this GV unit to your calculations. Just went into contract at $1750/psf

http://www.corcoran.com/property/listing.aspx?Region=NYC&ListingID=1027596

Actually, duecescracked, I stand by what I said: I'll take 40:1 odds IF I can play all day. (Which is what you said: "I'll bet on snake eyes all day long.")

If I have 1 roll of the dice, I have a 1/36 chance of winning, which means - on average - I would lose 35 times out of 36. Of course that loss rate could be much higher, or much lower, depending only on chance. If I don't want to lose anything - and I don't - then I won't roll.

You seem to believe - like so many of the "bulls" on this board - that the only way to win is the "play." For instance: "But what do you REALLY have riding on the outcome of your opinions? ZERO. NOTHING."

Sometimes, duecescracked, the best way to win is NOT to play. And when NOT to play is when the odds are stacked against you. Right now in the property market I believe - you can disagree - that the odds are stacked against me. So I don't enter it. Instead, I choose to pay rent and put my money in other investments.

Those are rational decisions. Trying to roll snake eyes with just 1 roll of the dice is just plain dumb no matter what the odds are: you'll lose 35 out of 36 times, so the chances are hugely stacked against your winning on your first and only roll.

Just so you know, it's people like you who make Las Vegas rich. If I go into a casino and don't bet, I come out with exactly what I came in with. If you go in, ON AVERAGE, you would lose 35 out of 36 times. But those are AVERAGES taken over long samples. If you think that every time you roll the dice 36 times you'll hit snake eyes, then you're a fool who knows nothing about probability. You're just as likely to roll snake eyes 10 times in a row as you are not to roll snake eyes ever in 360 rolls.

So if I go into a casino 359 times and never spend a dime, and you go in 359 times and bet, I'm guaranteed not to lose anything ever. You're virtually guaranteed to come out broke.

Read a book on investing: never ask how much you might win; ask how much you can lose. That's what makes a sophisticated investor, not quoting a single contract in GV for $1750 psf. I sold an apartment in Miami Beach for $1 million a few years ago, could buy it back today for $700k or less. The buyer was a flipper: KNOW YOUR DOWNSIDE RISK.

Know how much you can lose.

I bet you're comped in Vegas.

Just to add one other thing to your fatally flawed analysis, duecescracked: your odds of rolling snake eyes do not change with each consecutive roll of the dice. Every time you roll the dice your odds are exactly the same: 1/36. Your chances of rolling any double is 1/6; of one particular double, 1/36.

In other words, dice have no memory. They do not care what you just rolled. Your odds DO NOT increase with every consecutive roll. They remain absolutely, positively unaltered.

Your odds of rolling snake eyes 10 times in a row are the same as not rolling them at all in 360 rolls. Absolutely the same.

You say, "If you were able to roll all day you have a guaranteed win." No I would not be guaranteed a win. If I roll enough times I will in fact roll snake eyes. But that could be 10,000 times, or just once. Because the odds remain the same.

Wrong Steve - for one I don't get comped in vegas because since none of the odds are in favor of the player, unlike the example we are talking about.

Second, I don't need advice from you on either probability or investing. It's unlikely you will teach me anything on either matter beyond what I learned in the 4 years it took to complete my PhD in operations research and my 8 years in investment management.

Your ignorance of probability is evident by your explanation of the dice roll - if you get 40:1 odds to draw from 1 in 36, you should play NO MATTER how many draws you get, assuming the cost to play is negligible. And when you say 'on average you would lose 35 out of 36 times' you are IGNORING THE WHOLE POINT, which is that you win ONCE on average. And by the way, Yorick was the one that made the original 40-1 statement, not I.

If I play $1 36 times, I will win $40 once and be ahead by an extra $4 when I walk out. Last I checked, that is quite different from not playing and walking out with the $36 isn't it? It would be ridiculous for you to continue to dispute the soundness of this particular bet since its mathematical soundness can be verified by anyone with even a half sense of high school statistics.

To the point though, the $1500 (which should be negligible to you given your numerous claims of doing so well this year) would be well worth your time IF you truly believed in what you were saying. Your downside risk is $1500. Your upside potential is a profit of $3000. If you feel that there is more than a 50% chance that you are right about your forecasts of the manhattan market then IT IS A NO BRAINER to take the bet.

But then again, TALK IS CHEAP.

So are you now saying that there isn't even a 50% chance that prices will hit 2004 levels? Thats pretty different from the ABSOLUTE certainty that you have been displaying in every post to date. There hasn't ever been even a shadow of a doubt in your previous statements. Now you're at the point where you are comparing your forecasts to a random dice draw.

So what are the specific odds you require to bet on a 50% price decline in Manhattan prices within 12 months?

duecescracked, since my degree is in economics I did quite a bit of statistics myself. You are right, ON AVERAGE you win 1 in 36 times. But that does NOT mean that you will win once each and every 36 times. You may win once on your 350th time, then hit a further 9 snake eyes in a row.

But of course by the time reach you 350th roll, you're already broke. But you'll have made the average: 10/360 = 1/36.

And your chances of doing that are 100% absolutely positively the same as rolling snake eyes once in 36 rolls.

Then you change the rules: "assuming the cost to play is negligible."

The cost is never negligible. And the cost of real estate is never, ever negligible.

That's why the analysis is wrong. Your funds are limited, the cost is high, and you don't have FOREVER - which is what it takes for that average to play out - to win.

You claim a PhD in operations research and 8 years in investment management, and you say, as you did, "If you were able to roll all day you have a guaranteed win."

I think you should ask for your college education money back, because there is no guaranteed win, ever. The only thing guaranteed is that OVER LONG PERIODS OF TIME, you will, ON AVERAGE, hit snake eyes once every 36 rolls.

Perhaps you're a manager at one of the many quant hedge funds that are losing money hand over foot.

That's why I never take any bet like that. I'm not a quant player. I'm a value investor - everything over time reverts to its long-term mean. Housing prices included.

I don't have specific odds for a 50% price decline in Manhattan within 12 months. No one does. But one can easily do research in the price-to-rent ratio, find out that it's twice the long-term mean, add in factors such as decreased Wall Street bonuses, large Wall Street layoffs, and the evaporation of leverage, and make a very good educated guess that prices will fall far, and quickly.

Steve, the cost to play that I am referring to is the size of the $1500 bet that was proposed to you, not millions of dollars worth of real estate. Nobody was asking you to bet your life savings, but rather a nominal amount, which you refused to do even in the face of what would appear to be overwhelming odds in your favor (at least according to the vehemence of your other postings).

My statement about rolling all day is a guarantee was clearly not technically accurate but was an approximation based on the number of draws you could make in a day.

I think its best for you to limit your comments to the topic at hand and not styles of quant investing. If you knew anything about the business you would know that quant investing is in the vast majority of cases value investing done in a systematic way. So lets leave it at that.

In any case, where this leaves us is that you are not willing to put your money where your mouth is.

"..Proof of being over is the way I get answered by malraux...: they can't argue against me because there is no argument against me..."

I think "...the equations are timeless..." as well:

1. weasel-boy backpedaled
2. weasel-boy lied
3. weasel boy is a phony
4. weasel boy tries to bully and distract others from the real topic w/overcompensating 'arguments'
5. weasel-boy won't back up his arguments w/action, even when offered nominal bets w/dramatic returns
6. weasel-boy has no integrity
7. weasel-boy is pathetic

So are you just gonna type your logorrheic, long-winded 'arguments' all day long, which you never back up with action and instead use as a misguided tool of mis-direction? After all, I don't NEED to argue against you, all I have to do is say two little words, and we suddenly all know where you really stand....

"wanna bet?"

Yes I know about quant investing. Sometimes it's very effective; sometimes it's not. I don't have enough quants to invest like that, though Goldman Sachs might.

The reason I never bet - with the exception of maybe blackjack, where the odds are slightly in the player's favor - is because the odds are always in the house's favor.

"Was an approximation based on the number of draws you could make in a day" is still wrong. It doesn't matter how many draws you could make in a day. The odds are always the same - 1/36 - and there is no way to predict how the average would play out: your chances of rolling for 10 days and not getting snake eyes are exactly the same as getting snake eyes the first time. That average is not for one person or one set of dice; it's for all people who ever roll any dice over an infinite period of time. That's why gamblers always lose: they think that their odds get better with each next roll, when they don't.

You say, "which you refused to do even in the face of what would appear to be overwhelming odds in your favor."

When did I ever post the overwhelming odds? As a quant man, can you mathematically calculate the odds of a precise event occurring in the future with no historic information to back it up? I can calculate the chances of an earthquake occurring and the damage it will cause in any location of the world. I cannot calculate the chances of an airplane flying into the Freedom Tower. There are insufficient data.

I don't know the odds of it happening, though an educated guess tells me that that is what will happen. We've never been in a situation like this before, which is why no one knows. It's also why - and you should know this as a financial guy - all the mortgage paper has been written off by banks: no one knows how the paper will perform, so no one is willing to buy it. We know certainly that it's not worth its nominal value, but we don't know with certainty what it is worth. Therefore, GAAP says it's worth nothing.

I have predicted the general course I believe real estate will take in Manhattan. I don't know the mathematical odds; neither do you. I've given my statement why I believe that will be the outcome, but there are too many factors presently unknown to us to predict what will happen - and I can't bet "all things being the same" - because they might not be.

So instead of malraux's macho rants to have a duel, he would be better served to address the fundamental issues affecting Manhattan real estate, and tell me why I'm wrong. Only a fool would bet on something whose odds can't be calculated.

Which would make malraux a....

This discussion summarizes most arguments on these boards. There are the investors who think if there is a great chance you will win than it does not matter that there is a possibility of losing.

Then there are the home buyers like me who have one chance or several chances in a lifetime to purchaase a home. I am proceeding with caution because there is a possibility of a downturn in the housing market and the economy. The most recent evidence indicate that the possibility of a downturn is much higher than it was a few years ago. This is not gambling for me nor is it investing.

Oh, how interesting. First we get....

weasel-boy: "I'll take the bet, malraux, but April 9, 2010: prices down 50%. To make it easy, take the West Village. Current median psf: $1,633. $800 on April 9, 2010. Or all of Manhattan: $1,182 median psf. $600 on April 9, 2010. Take your pick."

weasel-boy: "I told you what I would bet on: median $psf either for the West Village or all of Manhattan, on April 9, 2010."

weasel-boy: "Name the spot for the escrow"

Then later we get....

"I never had any intention of taking a stupid bet" (and actually expect us to believe you?)

"I don't take a bet because I have no reason to take a bet" (how about integrity, not sounding like a liar, wanting people to somewhat believe your overwrought rantings, and/or personal pride?)

"The reason I never bet..." (sigh, more backpedaling and lies)

My personal FAVORITE quote from weasel-boy is as follows - "Sometimes, duecescracked, the best way to win is NOT to play. And when NOT to play is when the odds are stacked against you."

Which, you were finally smart enough to obviously realize, weasel-boy. Despite all your blowsy protestations, despite your foot stomping demands that we fall into line and "...address the fundamental issues affecting Manhattan real estate, and tell me why I'm wrong....," despite your epic attempts at misdirection through endless posts about WHY things will happen the way you say, gambling odds, and all the rest, the truth finally shines through. You initially made a retarded prediction "...watch for a 25% price decline in 1 year, 50% in 2...," and then when I actually had the temerity to call you out on it, you realized you couldn't win the bet. So the last 80 or so posts have been you, weasel-boy, dancing for all of our amusement as you try first to wriggle out of, then distract us from, the true reality of the situation. You had to get out when you realized that "the odds (were) stacked against you" and your absolutely ridiculous assertion.

Look, we all make honest mistakes. Just say "Hey guys, I probably was over-reaching when I made that one comment. I got called out on it, and it probably won't be that severe of a retraction at the end of the day. My bad. Sorry!" But this epic thread you've created instead of just being a mensch and admitting your error in judgement is profoundly sad, dude. 50% in two years? Stop being such an idiot. Or if you really DO believe that to be the case, deep down, with all your heart and soul, then take the damn bet!

Malraux: LOL! I also said that I had had my lawyer look over the threads. I enjoy dealing with you like this.

I stand by my prediction: 25% this year, another 25% next (from this year's prices) for a total price decline of 50% to 2004 levels. I have added before the caveat that something magical could happen like the government could give everybody in Manhattan $1 million to buy an apartment, but all things being the same: down 50%.

You tell me why "the odds are stacked against me." What are the odds? What were the odds that property would increase in value so much so quickly? No one knows - it had never happened before. We also don't know the odds that it will fall as I say. That's my prediction, and I stand by it.

I'm dealing with one man who claims to have PhD in operations research, yet doesn't realize that it doesn't matter how many times you throw the dice, the chances of rolling snake eyes on the next roll remain exactly the same: 1/36. Then I'm dealing with you, malraux - which I enjoy - who resorts to name-calling and illogic: "if you really DO believe that to be the case, deep down, with all your heart and soul, then take the damn bet!"

I really do believe that to be the case, deep down, with all my heart and soul, but I won't take your bet because I don't know for certain: it might be 48%, it might be 2.5 years, something unforeseeable might intervene, I don't know. But that is what I really do belive to be the case, deep down, with all my heart and soul.

"...You tell me why 'the odds are stacked against me.' What are the odds?..."

Uhhhh, the odds that you're a pathetic idiot. Those odds.

"I'm dealing with one man who claims to have PhD in operations research, yet doesn't realize that it doesn't matter how many times you throw the dice, the chances of rolling BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH BLAH (like anyone relly cares)........"

My favorite quote to date "I really do believe that to be the case, deep down, with all my heart and soul, but I won't take your bet because I don't know for certain" Oh so NOW you don't know for CERTAIN? Well, at least THAT'S an admission in the right direction. So it MIGHT be 48%, not 50%? What about 40%, instead of 50%? What about 25% at the absolute nadir of the cycle, instead of 50%? Oh, it might NOT be 2 years? It might be 2.5 years? What about 3.14159 years? What about never?

The issue here is NOT with your opinion. Everyone is entitled to their opinion. But if you don't back up your opinion with modest action when your feet are held to the fire, then don't expect others to value your opinion very much (or at all). I mean, we're taking about a fun bet of $1,500. No one gets hurt, and it adds a little spice to the proceedings. It's really a no-lose situation, actually. It's entertaining, but in the end meaningless - like all your posts, weasel-boy.

Here's what I think. West Village down 8% in calendar year 2008, down another 8% in calendar year 2009. Then stable 3%+/- until the inevitable upturn occurs. No long winded arguments. Just my gut, based on 25 years+ experience in this specific market as a buyer and seller.

malraux, you're entitled to your opinion, and you may be right. I doubt it, but you may be right.

Of course, you have a gut feeling without stating what facts support that gut feeling, but then again, par for the course.

I've always said it could be 48%, it could be more time, that no one knew the exact odds because they're unknowable.

Imagine if I had a bet with you that could only be resolved 2 years hence. That means I'd have to deal with you for the next two years. Yuck! :)

Malraux "Here's what I think. West Village down 8% in calendar year 2008, down another 8% in calendar year 2009. Then stable 3%+/- until the inevitable upturn occurs. No long winded arguments. Just my gut"

That sounds like a very reasonable point of view and certainly in the realm of possibility.

As to the Alexander HaMalraux vs. Aaron BurrJHX duel / bet challenge That does not sounds quite as reasonable.

ok steve. lets just leave it at this: you feel that if someone gives you 1:40 payoff on a draw where the odds of hitting your payoff are 1:36, that is a bad bet. Enough said.

your ability to deflect the facts and never admit that you are caught on the wrong side of an argument is quite fantastic. Reminds me of george w.

Yes - it's a bad bet because your best upside return over the long term if you meet the average is an 11.1% gain, and your downside loss if you don't meet the average potentially 100% of your principal, because losses are realized immediately; the distribution is random and no skill is involved that could ever increase your odds. So yes, it's a bad bet: I could invest in an S&P 500 index fund and make that amount over time with a much lower downside risk, since short-term losses are not realized immediately.

If you have $100,000 in cash and have all your life and want to wager $1 every time you throw the dice and can stop anytime you like, go ahead - the wager is immaterial with respect to the principal. But if you have $36 and do the same thing, you're a fool.

If you do it for fun and can afford it, go ahead: piss your money away. But it's not a way to make money, which seems to be what you're claiming.

I do know what you're saying and I understand your theory: I occasionally do play the lottery, but only when the prize money exceeds my chances of winning. (Sound familiar?) Do I think it's a good bet, however? Absolutely not. Would I do it as a way to make money? Positively no. Can it be fun? Yes. Can I afford $20 a year? Yes.

What fact have I deflected? None. When have I not admitted that I'm on the wrong side of the argument? If I make a mistake I admit it. But you asked my opinion, and I gave it to you: in my opinion it is never a good idea to wager on something whose outcome is wholly random, such as throwing dice. I don't care if they give me a $1 million return on 1:36 odds - I will not spend my LAST DOLLAR on such a bet. It has nothing to do with finance and everything to do with economics: the marginal utility of $1. If I have lots of dollars fine, I can do it for fun. But it is NOT a good bet on a marginal basis. If you think it is, then you should be spending your time playing craps.

duecescracked, as I was walking to the bank the absurdity of your implied claim that it was a good idea to take a random wager when your odds of winning are 1:36 if the payoff is 1:40 became apparent to me.

Let's play a little random game, not unlike craps: take a pistol, put one bullet in one of the six chambers. Blindfold yourself, spin the chamber, put the gun to your temple and press the trigger. Repeat 5 more times in a row. If you beat the odds, I'll give you the $1,500 malraux wanted me to bet.

Your potential return is huge. So huge, in fact, it's infinite, because it doesn't cost you anything and you can potentially make $1,500.

Oh but wait - there is that little thing called the downside....

Assh*le.

Malraux, want to take me up on that same bet? But for you, I'll make it $15,000.

Or are you going to try to weasel out of it? I won't take a bet because I can't calculate the odds. Fair enough. The odds in my bet are quantifiable. Therefore, it's a better bet. A surer thing. And you did say that if you don't back up your opinion with modest action when your feet are held to the fire, then don't expect others to value your opinion very much (or at all). I mean, we're taking about a fun bet of $1,500. No one gets hurt...

Oh, wait - there is that little thing called the downside....

weasel-boy, you couldn't even stomach a $90,000 bet, so I had to lower it to $5,000. But you couldn't even stomach a $5,000 bet, so I had to lower it to $1,500. But you couldn't even stomach a $1,500 bet, so......YOU WEASELED OUT!

And, after I graciously let you off the hook a few posts ago, you come back and try to draw an equivalent between putting you life on the line vs. $1,500? Riiiiiight.....I mean, do you actually know that you sound like an idiot? Or are you trying to be "funny" or "sarcastic?" I really can't tell. Either way, you're a bore.

"...I won't take a bet because I can't calculate the odds. Fair enough. The odds in my bet are quantifiable. Therefore, it's a better bet. A surer thing..." This, from someone who SAYS they trade in the market, return 60% on their money in one year, and earn $1,500 per day. It's pathetic. But I think what's even more pathetic is the fact that you prefer to take chances with things that are quantifiable, that you won't bet on something that you can't calculate the odds for. You must a very sad, lonely person. I actually feel bad for you now. No wonder you spend so much time haranguing everybody on these boards with your 'quantifiable facts.' What an utter waste you are.

"But I think what's even more pathetic is the fact that you prefer to take chances with things that are quantifiable, that you won't bet on something that you can't calculate the odds for. You must a very sad, lonely person. I actually feel bad for you now."

What?

Actually, I'm busy at work right now - got a call from London this morning to do something for Monday morning GMT, on top of all my other work - but I was responding to the ridiculous post by duecescracked that it was always a good idea to bet on craps. So I was just extending you the offer, since he comes to your rescue.

I can't calculate the odds of where housing prices will be in 2 years. I think I know where they'll be, but no one can be certain. Therefore, I would not bet on it in the sense of a wager; I would, however, wait to see how things work out, and then make a move when I believe the timing's right.

Or, as the wise men say in the document I'm translating, "forward-looking information and statements are subject to risks and uncertainties, many of which are difficult to forecast and are, in general, outside our control, and could cause actual results and developments to differ significantly from those stated, implied or forecast in the forward-looking information and statements."

I wholly agree, and that's what I said.

We can change your bet, though: 1 bullet, 1 chance, $1,500. Then we'll change it again: shoot your foot (as you often do) instead, so you won't be hurt that badly. You know the odds: 1:6. Are you willing to take them?

Steve, your posts are becoming truly absurd. Do you not see that? You are now comparing wagering one day's pay with bodily harm.

Every forecast like the ones you have made inherently is backed by some implied odds that determine how strongly you believe in it. It is weak of you to not be able to even give a ballpark probability to what you have been SPEWING forth here for weeks now with INFLINCHING conviction. We have already understood that you feel there is less than 2:1 chance of your predicted price drops. So can you not even say whether its 3:1, 5:1, 10:1?

I would have thought a man that is so proud of being able to back things up with facts would have been able to put a number on something they feel so strongly about. If not, then this thread has gotten way long in the tooth and we should just move on to you continuing to perpetrate your opinions without ever actually committing to them in a hard manner.

I'm glad you recognize the absurdity of what I wrote - I was merely pointing out downside risk in the most exaggerated form I could. People spew, as you say, all sorts of things here, saying ARM's have no risk, saying buying is a good idea no matter what the price is, that prices are always going up, without looking at the downside; denying that it even exists.

So I made it extreme, but quantifiable. Financial ruin is not bodily harm, but for a lot of people it is a reality nowadays. They got into things that they didn't understand; they're losing their life savings. People here say it's always a good idea to bet on snakes eyes if the return is 40:1 when the probability of winning is 36:1, when it's not. People on other threads are still offering exotic mortgage products without regard to a person's ability to pay it back.

I'm glad you got the point I made, even if I had to make it absurdly.

I can tell you what I think will happen, and when it will happen by. The future is unforeseeable, however, and no one can predict an exact figure on an exact day, any more than they can say that the Dow will be at a certain figure in 3 years. We are reasonably certain that it will be higher, but we can't pick any specific number.

You say, "by the way, you can add this GV unit to your calculations. Just went into contract at $1750/psf http://www.corcoran.com/property/listing.aspx?Region=NYC&ListingID=1027596," the implication being that just because today's price is one thing, tomorrow's will be something else. As a quant investor surely you know that that is a fallacious assumption. To find value you look at ratios, not absolute numbers, which is what I am doing. And as an investor you look at the potential downside before you look at the potential upside, and don't take bets on random outcomes.

So I'm glad you see why malraux's post was ridiculous when I reframed it a different way. But you two are getting boring: malraux has "gut feelings" which may or may not be right, but he doesn't say what he bases them on. You claim to have a PhD in operation research, yet you say, in a "sort of" backpedal, that your "statement about rolling all day is a guarantee was clearly not technically accurate but was an approximation based on the number of draws you could make in a day."

When not even that is true in probabilistic terms. Roll all day long, it doesn't affect your chances. Just because you rolled 3 the last time doesn't at all affect your chance of throwing a 3 this time.

Sorry, but it's true.

People need to look at the downside of investing, not just at the upside, and not just whether an apartments has granite countertops or not.

steve: Your odds of rolling snake eyes 10 times in a row are the same as not rolling them at all in 360 rolls. Absolutely the same.

Geez, I dropped out of college in my freshman year, and I last studied math when I failed calc in high school; but I do occasionally play backgammon with my kids. Intuitively, I'd venture that the odds of those two events differ by orders of magnitude.

This is an easily quantifiable wager, but I don't imagine I'll get any takers.

Steve, we both know that if you were to sit and roll dice all day long it is a virtual certainty that you would hit snake eyes, not once, but many times. Specifically, the probability of NOT rolling snake eyes in 1000 tries is (35/36)^100 = 0.5%. But if you do this in practice you will find that you hit snakeeyes usually within the first 24 tries.

Let's not parse technicalities such as this because it adds no value to the discussion.

I pointed out the GV property simply because it is a new datapoint amid the doom and gloom that has been the order of the day on these forums. It certainly doesn't say anything about what might happen 12 months from now but is nonetheless relevant.

You're still the original streeteasy gangster, but its probably time to move on from this thread.

Okay, what's wrong with these two quotes coming from the same knucklehead...

Exhibit A - "watch for a 25% price decline in 1 year, 50% in 2."

Exhibit B - "I can't calculate the odds of where housing prices will be in 2 years."

"Or, as the wise men say in the document I'm translating, "forward-looking information and statements are subject to risks and uncertainties, many of which are difficult to forecast and are, in general, outside our control, and BLAH BLAH BLAH BLAH BALH....."

It's called "making a bet." It's called "putiing money wheer your mouth is" Traders do it all day long. But you would know that, if you actually worked in the market, I guess, huh, weasel-boy?

typo in my prior. Its (35/36)^1000

You get the point

duecescracked, the probability of not rolling snake eyes in 1000 tries is (35/36)^1,000, or 0.00000000005828%. The probability of rolling snake eyes in 1000 tries is 99.99999999994170%.

And you made my point. The longer you do it, the greater the probability of rolling snake eyes. Roll 1,000 times, and you're almost sure to win. Roll 100 times and your probability of winning is 94.02%.

Roll once, your probability is 2.78%. Roll 36 times, your probability is 63.73%. (1-(35/36)^36).

Most people think that because the chance of rolling snake eyes is 1/36, that's that's the likelihood of their rolling snake eyes in that many rolls. In fact, only 63.73% of people who roll dice 36 times will roll snake eyes.

You have a 50:50 chance of rolling snake eyes once in 24-25 times. 50:50 is not "usually" to me, but it may be to you. To me it's "more often than not," but perhaps that's splitting hairs.

Actually, Yorick, you have almost no chance of rolling snake eyes 10 times in a row. The probability is 0.00000000000002735%. The probability of NOT rolling snake eyes in 360 rolls is 0.0394%. Quite an order of magnitude.

But that's not what I meant: I was discussing the random distribution of dice rolls, not the probability that it would occur. Over long periods of time, the probability of rolling snake eyes increases, but for any particular roll the chance remains the same: 1/36. It may not be probable that someone not roll snake eyes once in 350 times (probability of 0.005%), but it could happen, because each individual roll is unrelated to the prior one. I was discussing how a distribution might hypothetically occur, though I do admit that what I said wasn't clear, and I'm glad to clarify it. Sorry.

And malraux, this is exactly why no one would take your bet: there's no way to calculate what I just did, because the data don't exist to do it. That's also why banks are writing off so many mortgage-backed securities: there are no historical data on performance.

If you're a gambler, this is how you do it. If you're an investor, you just look at ratios, and I stand by mine, but I will not bet like it's a probabilistic event.

Steve - despite the fact that we don't see eye to eye I have to admit that you have a strangely endearing quality about you. Perhaps we should play poker some time.

I'm calling this thread dead at this point

Just to make it clearer still, my point was that regardless of what the probability of anything is, the odds of your next roll remain the same. I roll snake eyes. It's my next turn. The probability of rolling two snake eyes in a row is .077%. Regardless, the odds that my next roll will be snake eyes are 1/36, or 2.7%.

duecescracked, I'm sure you know that the downside of quant investing is that improbable events occur all the time, and probability is not a predictor of whether they will happen or not. There's the famous story about a guy who heard that the probability of someone carrying a bomb on the plane was 1 in a million. So he figured that because the odds of 2 people carrying a bomb on a plane were far higher, he decided to take a bomb on the plane.

Unfortunately, that does not diminish the odds of that 1 other person bringing a bomb on a plane: they remain 1 in a million.

Or, what are the chances that I get hired at a new job by a woman I don't know and have never met in my life, and it happens that she was the prior tenant in the apartment I am currently living in, in the Washington DC metropolitan area?

Well, it happened.

What, then, is the further probability that after 20 years I would talk to a random person sitting next to me in a coffee shop in Greenwich Village, and it happened that he was the former boyfriend of my former boss's sister, and they both lived in Lewiston Maine, when I had met my boss in Washington, DC, I was living in her former apartment in Arlington, VA, and this guy was on a weekend trip to Manhattan?

What is the probability that I would take a job in Price Waterhouse in Madrid, replace an Argentine who held the job before me, quit and move to Miami, and there meet an Argentine whose former boss in Argentina had been my predecessor in Spain?

I could go on. Probability does not predict future behavior. Dice don't understand probability. Regardless of the probability, every time I roll the dice I have the same chance of rolling snake eyes: 1:36.

That's the problem with some quant investing, and that's the problem with ignoring the downside of any investment, or any bet: improbable things happen all the time.

Deuces, aren't you a recent transplant from Chicago, or am I confusing you with another poster from a few months back?

How'd you find a poker game in NYC so quickly?

Steve, I recommend you read the book "the black swan" by nassim taleb

Yorick: yes, that's me. Poker is an important element in life, can't go long without it

I just figured it got harder for newcomers after Frank's murder last fall. Back when I was playing in NYC, you needed someone to vouch for you before you got into a poker room.

stevejhx so how many millions did you make in 2006 buying all the credit default swaps on mortgage companies you can get your hands on. John Paulson made billions doing this. Oh I forgot in 2006 you were not forecasting a subprime meltdown or national housing correction. No instead you were actually buying real estate on long Island. Now after all the news is out after all that is on the front pages of the NY Times you are now predicting a housing correction. Give us all a break stevejhx you are nothing short of an asshole that has absolutely nothing better to do with his life than to spend all day posting your stupid ratios, statistics and forecasts that are several months old.
Where are your predictions and forecasts you made in 2006 for 2008?

Spunkster, "stupid ratios, statistics and forecasts."

Beware of those ratios: they always hold true.

duecescracked, thanks for the literary idea. Right now I'm tied up translating financial statements and doing stand-up shows in Philly, but in another one of those freak, improbable events, I talked to somebody last night at a bar & it happens that he's from Milwaukee and knows my ex from the University of Wisconsin, and was at a party at his house & is friends with a friend of his. So, improbable events occur all the time, and beware of probability as a predictor of the future. It's not - regardless of the probability of throwing snakes eyes twice in a row, every time you throw the dice, your chances of throwing snake eyes are exactly the same.

Every time you take out an ARM, your chances of a reset to the max are the same, even if it's an improbable number.

duecescracked is a poker player? At least there's some skill involved in that game.

stevejhx please do us all a favor take your medication

jmcbyr8, which of the many?

duecescracked, I'm a horrible poker player, so as long as we don't bet more than a penny at a time, you're on.

Else I'll go bankrupt in no time.

How sweet would this poker game be:

deuces
stevejhx
spunky
malraux
11201965
urbandigs
juiceman
eah
iMom

don't forget poorishlady, who backed out of her co-op purchase.

I tell you now, I will lose at poker, b/c I always do. Ergo, maximum bet 1 cent.

deuces, that would be either be hysterically funny, incredibly boring, or ambulances would need to be called. I'm not quite sure.

Yes, I don't care if he wins, but I do require that malraux be chained at the hands and feet. Nothing kinky, just for my own personal safety.

weasel-boy:

I'm not the one who brought the idea of playing russian roulette with a gun into the equation. Look in the mirror.

But I would DEFINITELY be down for a good poker game. I'll supply the munchies. What game are we playing - hold em'?

You really don't like it when people don't play by your self-imposed rules, do you?

Oh, well.

A Streeteasy poker game? NLHE? Oh hell, I'll supply the table and the chips.

Great article in the NYT about Banks closing HELOC's on people with great credit in all areas of the country. IF anyone would like to review my past posts you will see I predicted this over a week ago. This is just another way that the credit problem will worsen over the next 12-18 months. This will cut off the revolving debt of millions of homeowners. They have already maxed out the credit cards and were using the HELOC to survive. Millions of people have literally been using their HELOC to pay the mortgage, groceries and gas. Now just imagine that this source of money no longer exists. What's the first thing that doesn't get paid. Yes, you guessed it the mortgage. So people ask why I think at times the sky is falling. This is one of the main reasons. These are the millions of home owners that have been hiding behind their HELOC's to cover their bills. Now not only are these homes going to almost double the foreclosures, but the secondary banks that hold these HELOC's are going to get hit a second time. Secondary banks get nothing until the primary mortage gets paid in full. Just think of the Billions in loses not yet factored in to "right down" equation. Once all the banks start to realize that people are using their HELOCs just to survive it will be a race against the clock to close them all ASAP.

If you are using your HELOC to pay your mortgage, groceries or gas there are only 2 ways this story ends.
(1) HELOC stays available and you max it out=Bank takes another $100,000 lose by Foreclosure
(2) HELOC closed= Bank loses $75,000 and house goes into foreclosure.

You guys see it? It's the Banks that lose the most. No one knows what the real damage is. The closing of the Helocs will force Millions of homes into foreclosure in the next 12 months. The lose for the banks will be staggering. People this is the perfect storm. Cash will be King when this goes into full swing and those with cash will make ton of money in the next decade.

stevejx and malraux - I posted this elsewhere, but how about the two of you take a bet on this NY Sub-MSA for Manhattan condo market? it's a tradable OTC index with standardized methodology and daily updates of 63 day delay data:
http://analytics.radarlogic.com/radar-logic-home/historical-data.aspx

oberon what do you mean it's tradable. What is the symbol.