Sorry, But It's Not Over Yet May 16, 2012
Nothing Is Going On The May 12, 2012 VedicLeaks, Thing Is Going On, is incomplete. Following the leaking of Jupiter's winter-long optimism bubble mid April, most folks are still feeling pretty darn good. The economy, and even real estate, is looking up. And this mental fatigue from last winter's weak Mercury is wearing off. In fact, mental Mercury was so weak and afflicted from late February through early May, that we scarcely remember what happened during Mercury mayhem. The Republican Presidential candidates battles were ridiculous, but no great harm resulted. Sure, Romney isn't a dream candidate, but he's not a bomb thrower like Next Gingrich -- nor extremist like the other candidates, each of whom took their turn at the popularity plate and then whiffed. Most don't even remember the pizza king, what's his name?... oh Herman Caine! Nothing terrible on the globe has happened either. Greece got its debt band aid. Italy and Spain haven't collapsed. Ireland is in recovery. European voters having been busy kicking out their governments for unfair austerity measures, but so what? The Arab spring seems to have settled. Syria is an issue, but hey, isn't there always some kind of turbulence over there? Yes, Iran is a problem, but it's being boxed in with sanctions. Gasoline spiked up, but it's already going down, and once this Iran thing get's settled, it must drop back down a buck or so. Our troops are out of Iraq, and Afghanistan is winding down, sort of. There was this $2 billion trading loss by JP Morgan, which not coincidentally happened when mental Mercury was harmed. But really, what's $2 billion, when the bank's profits are $10 billion? (This has struck a nerve, though, and it will be interesting to see how the issue unfolds, JP Morgan Chase's $2 billion trading loss renews calls to bust up giant Wall Street banks.)
Complacency & Frugality Fatigue In fact, nothing shocking has occurred truly since last summer's Texas drought, hurricanes, earthquakes, the U.S. debt rating was cut and markets tumbled. See the September 15, 2011 In-depth Forecast, Mars/Saturn Recap. Well, that's a long time ago! We had a good winter, and spring started with blossoms. Yes, there were some bad storms, but don't we have those every year? It's true a lot of folks have been worried about the end of the world. National Geographic published this survey February 7, The Results Are In: Is It The End Of The World As We Know it? Survey Says! This May 1 article's title tells the grim tail, Ten percent of world population fears 2012 apocalypse, belief strongest in China. But even this fog of gloom has been pierced. Archeologists told us just a week later on May 10 of a discovery that the Mayan Calendar isn't ending December 21, 2012 after all, Maya art and calendar at Xultun stun archaeologists. Well, it's not as if The Celestial Wheel hasn't been refuting Mayan Calendar end disaster. Hosanna, we're saved. Everything is okay! With all this good news, and a lack of really bad news too, we've become complacent. We're also then ready to spend. The April 28 VedicLeaks included a humorous section titled, Catchy Terms coined during this winter/spring Mercury mayhem. One described the reason for luxury real estate sales rebounding, Frugality Fatigue. Well, that's not just for the rich. Everyone is tired as heck of pinching pennies. In fact, the Canadians actually got rid of their pennies completely!
Sorry, But It's Not Over Yet We need to remember this economic contraction, which I've term the Millennium Contraction (a depression), began as a real estate bust. It continues so, and won't end until 2015. These trends issue from the U.S. Vedic chart's three Dasas (planetary cycles), repeating from the nineteenth century.
{Note: If you are not clear on these economic and social transformation trends, there's a special section on The Celestial Wheel home page, History Repeats Series Gilded Age To Contraction To Progressive Age. It lists six In-depth Forecasts explaining this sequence. Written beginning in 2005, history has proven these absolutely correct and accurate. If you want to short-cut this, the key forecasts are, Through The Second Gilded Age and Through The Millennium Contraction. As they say in poker, read em and weep.} In July 2010 Through The Millennium Contraction, the section, Real Estate Deflation discusses that topic. Below is a housing price graph from that forecast. The scale on the left is prices in thousands. Pay attention to the end of the red Homes Prices line.
Housing Prices 2010
The May 2012 article, Why U.S. House Prices Won't Recover has a similar graph, below, updated to the present. Both are from Shiller, the only long term housing price index, which has also proven accurate and used universally now. Again, pay attention to the end of the Home Prices line. Comparing the graphs, you can see residential real estate prices have continued to plummet since July 2010 -- down about 145,000 to $120,000. That's $25,000 or nearly 20%. Look now at the entire Home Prices line - using either graph. After the end of the First Gilded Age in the 1890s,, the real estate crash continued to pull prices below the long term average. Recovery to the long term average of about $120,000 didn't occur until the 1950s -- over half a century later! We may, then, have another 20% more to fall in R.E. at the end of this Second Gilded Age.
Housing Prices 2012
This is what I wrote in Through The Millennium Contraction -- just above the graph in that Forecast,
Unfortunately, it seems I was overly optimistic. Nationally prices have already dropped 20% in the past two years and will slide further, about another 20% Real estate markets are often said to be local -- responding to economic conditions in the area. Still, it's also true that major shifts, like the boom and then the bust, impact home prices throughout the country. Since the peak in 2006, home prices have dropped by a third on the average. In some areas, prices dropped by 60%, in others, just 20% -- but no locale escaped the bust. Thereby, both national and local conditions must be considered. This current article, America’s Fastest-Growing Housing Market, gives encouragement for those of you in these areas that your home values are not just safe, but also increasing. Of course, for some of these areas, the previous drop was so huge, the upcoming increase is just a market correction on an exaggerated loss. Still, if your community is economically healthy, you also feel secure. The problem, of course, is that as the national economic forces drive real estate down that further 20%, you're home value must also slide. When there's a drought across Texas, all farmers suffer. Here's an example of a rosy scenario. Let's say you bought a home for $450K ten years ago with $360K mortgage and a 20% down payment of $90K. The price peaked $600K in 2006. Because it's a good area, it only slid down 25% to $450K, and recently prices have actually moved up a little. You have so far escaped any loss and are actually above water or treading water. But, truly, you're not out of the woods yet. There's the other shoe, another 20% drop on the current $450K is $90K, resulting in your home's future price of $360! Uh oh. That doesn't sound very good, does it? How much will you be down from your $450K 2002 purchase? $90K. Now, even his may seem to be okay, if you were smart and refinanced recently at a really low interest rate with an 80% loan of $360K. You can handle that affordable mortgage payment and stay in the house. Fine? No, because when the house goes down to $360K, you will have lost all your equity. Then, the market value and the mortgage balance will be the same, $360K. Hey, treading water is better than being underwater, right? No again, for you will actually be underwater when you include consider your original 2002 $90K down payment. And, if you had plunked down some more cash on the refinance, and some heavy closing costs, it's even worse. The snorkel you need to breathe just got longer. And, when you sell, because of a job change, retirement, health issue.... you won't have a down payment for the new home. This article is instructive, Insight: Falling home prices drag new buyers under water. Well, if that's the rosy scenario, how bad can it get? Here's that flip side, Cities Where Home Prices Are Collapsing. Well, thank your stars you don't live in one of these places! Well, you would get really stuck if you're in an area that is supposed to be recovering but actually isn't because it was pumped up temporally this past winter. I'm in Southwest Florida now, in Venice, and Sarasota is 30 miles north. Everyone has been so cheery about Sarasota's increase in real estate sales, and even some price growth, this winter. Everything's great and gonna get better, right? No again. That article states, The Southwest Florida housing market may have the worst long-term outlook in the country, and Cape Coral-Fort Myers is the worst in the area. Fort Myers, just south of Venice, is slated for an 8% drop this year. Just another 50 miles to the south, wealthy Naples is even worse at 9.5%. Why would this be? One reason is the foreclosures backlog is hitting the market, Foreclosure filings in Sarasota County up by 56%. Another is, Data portend another tough year for Florida's economy. This article's first two pages rehashes the foreclosures issue. On the third page, we find the culprit, The majority of homes sold in Florida since mid-2010 have been bought by foreign nationals paying cash, then renting the properties to Americans who can't afford to buy or who will rent by choice. With Europe now withering on the vine, even Germans have stopped buying Florida grapes. Hopefully, readers will follow, understand and take heed to this negative information, even as it flies in the face of Complacency & Frugality Fatigue, for these truly as just wishful thinking. Or, to use another catchy term from the April 28 VedicLeaks entry, Hopium.
Sorry, But The Road Ahead Gets Rough Again The above analysis is certainly sobering, but it doesn't reveal when the next economic hits will occur. The U.S Vedic chart shifts into it's very risky Mars/Mercury planetary cycle May 31 for a year. In this chart, Mars is the planet signaling economic depression and Mercury is a planet signifying catastrophe. The U.S. ran its 16 year Mercury cycle from 1948 to 1965. That was the nuclear arms race when we lived in honest fear of blowing up the globe. Also, Mercury was the linchpin planet for 9-11. Transits, where the planets are in today's skies, are timing indicators. And when the malefic planets join in transit, great destructions result. Without going into detail in this forecast, warrior Mars transits to Saturn, the great malefic in mid August. I wrote about this in February 20, 2012 In-depth Forecast, The Economy And Oil. The single prediction there is that Israel will attack Iran then, shooting rockets down, making oil prices go skyward. To get an idea of how intensely destructive this planetary combination is, see Mars and Saturn last conjoined in 2010. Just six weeks later in early October, Mars transits to Rahu, the head--of-the-dragon eclipse point. Mars and Rahu collided in the winter of 2009, just after Obama took office. The DOW Jones crashed to 6500 on March 6. See, More On The Big Blizzard Of 2009. Mars/Rahu last crashed in December 2010, heralding the Arab Spring. Mars/Saturn is ferocious destruction. Mars/Rahu is unanticipated and uncontrollable blasts. Now, it wouldn't be too bad if these two Mars transits across Saturn and Rahu were separated by some time. Unfortunately, Saturn is in Libra and Rahu next door in Scorpio. So, Mars hits Saturn and then Rahu in just six weeks. So ferocious destruction is quickly followed by blasts coming out of nowhere. It's too early to predict specific events from this close sequence of truly destructive transits, excepting the above noted already made Israeli attack on Iran. There have been a number of dire warnings in the media recently, and these give warning, as well as indicate risk areas. Obviously, man-made and natural disasters both impact the economy, including real estate. Twin domestic crises spotlight local abuses in China Experts Are Calling Fukushima a Ticking Time-Bomb
End Of Materialism End of materialism is a hot topic. It's realistic for those who understand an economic depression causes a re-ordering of needs and priorities. By dramatic reduction in material well being, it brings people together, rediscovering we and the value of selflessness -- good deeds, charity... Losing ones wealth gives the tremendous benefit of destroying the materialistic ego to gain humility. This is a process of purification. It's the great leveler, crushing inequalities and thereby enabling shared democratic values. The Buddha said Life is suffering. Hindus believe we grow by experiencing challenge. True Christians are truly charitable. All religions sing the same song. We just have remember what those belief systems truly are and avoid the ones that pervert religion for personal gain, just as we have to do the same in business, on our jobs, with our friends and family..... End of materialism is unrealistic for those who believe that all we have to do is give up on modern society, and our consciousness will somehow become magically elevated. We will all become farmers and then Light Beings! Life doesn't work that way. The truth that the Mayan Calendar is not ending has shattered the idea that we don't have to do the suffering ourselves to learn. Unfortunately, no one has unearthed an ancient scroll in Jesus' handwriting saying that this Armageddon stuff is a bunch of hooey and that he has no plans of coming back to fix us -- that it's our job to fix ourselves. Hindus, by the way, call this the karmic of personal responsibility. The Millennium Contraction is this purification in our age, opportunity for real transformation. It purifies. It cleanses. It scrubs clean. Fitting our old square pegs into new round holes requires shaving off some wood. As we have to let go of attachments in our emotional and spiritual lives to become healthy, we have to do the same with our attachments to material benefits. But, what to do with that house?! It's big, expensive and we like it. We don't want to let it go, but we're afraid it will eat us up, devour our income and assets, prevent us from leading decent and balanced lives. The answer here is simple -- do the right thing, not the clever thing, not the work-around thing. Getting there isn't so easy. Clicking your red shoes together three times only works in OZ. You have to do the work, analyze, look hard at what's important, be thoughtful of those around you, but don't let contemporaries sway your view. That's just status seeking. After that process, if you're okay with your home and the rest of your life, you can rest easy knowing you've done the best you can. But, don't stop there. This is a process. Continue to spend examine at the rest of your entire lifestyle -- from fixed expenses to ones you can modify, your job, enjoyments, personal care costs..... One thing is certain, and that is Mars conjoins Saturn in mid August and then six weeks later Mars conjoins Rahu -- conjunctions in the celestial sphere that signal further steps in the Millennium Contraction. Mid August and early October will be huge reality checks. Use this information for your benefit. Ignore it, and you will have regrets and needless suffering later on. Oh, and lose the Hopium.
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10 year Moon 1998 to 2008 -- Gilded Age
