On Monday July 11, 2011, Louis Cammarosano, General Manager of HomeGain, was a guest on the Real Estate Radio show on The Big Talker 1580 AM, hosted by Ryan Sloper.
Listen to the show.
Part 1 (24:33)
Ryan covers the Casey Anthony murder trial. Ryan noted that Moody’s downgraded Portgual’s credit rating to junk status. Ryan and Louis discuss Italy’s credit rating. Louis notes that Italy is too large of country to bail out and that many western countries have similar debt issues and keep kicking the can down the road by issuing more debt. Louis notes that the road eventually will be a dead end. Louis notes that the debt issues faced by countries can not be solved by issuing more debt. Ryan predicts that the US debt ceiling will be raised. Louis agrees and notes that the issue is that the debt ceiling gets raised routinely and immediate spending cuts are not taken seriously. Louis speculates that the Fed could secretly funnel money to third parties to purchase US debt and comments that since the Fed is not audited it is difficult to keep tabs on their activities;Ryan and Louis note that interest rates are kept artificially low and that all the sovereigns have debt issues; Ryan note that by keeping interest rates low bubbles are created. Louis notes that today’s low interest rates are designed to reflate the housing bubble but notes that as our currency is debased, even if interest rates rise and home prices drops the losses could be offset by paying back in the debased currency;Louis notes that owning a home, commodities, gold and silver may be safe havens in light of economic uncertainty;Louis and Ryan discuss the difference between buying homes as investments vs. speculating and flipping homes;Louis notes that at interest rates in the single digits and below the real inflation rate, the banks are paying borrowers to take the money;Ryan and Shaun Murphy of Remax discuss the Arlington real estate market and note that the market is relatively stable given the amount of government contractors in the area. Shaun notes that 12% of loans in June were VA loans ; cash deals were 11%, conventional loans were 60% and FHA loans were 17%;Ryan and Louis discuss stated loans for self employed borrowers;Louis asks what will happen to the DC market if there are federal cuts; Louis notes,however, the prospect for significant federal cuts are remote;Ryan notes that Warren buffet predicts a housing rebound at the end of this year and that unemployment would drop below 8%; Louis remarks that just because Warren Buffet is a good stock picker does not mean that he understands the overall economy and notes that Warren Buffet has belittled gold as an investment, yet gold has out performed Buffet’s Berkshire Hathaway’s stock; Louis also notes that Buffet often expresses his opinions on the debt ceiling and the tax ceiling; Shaun discusses the rental market in the DC area. Louis notes that as rents rise, owning a home as a primary residence or investment becomes more attractive and also notes that as inflation rises, rents will also rise, whereas a home owner with a fixed mortgage will not see their monthly payments go higher.