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Gavin

A New Buzzword For Bears

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I have been looking for a word/phrase that describes the mindset of bears (both STR's and delaying FTB's) that are convinced that prices will fall significantly in complete opposition to the general popular understanding that we will see a plateau or gentle rising prices.

This contrarion view being the exact opposite of sheeple mentality.

I would therefore describe bears as "thinking outside the box". In this case coveniently we do actually have a box, the box of a house, the box of stability, the constricting box of a large mortgage.

All bears are thinking outside this box, whereas sheeple are happy inside the box, and see no danger. Actually I sometimes bemoan the loss of this stable in-box feeling, because its comforting to own your own home and see little financial danger ahead. The trouble is I can't be content sitting in the garden, putting my washing on the line as storm clouds gather.

As thinkers outside the box, have bears ever noticed other areas/circumstances where they have used this ability to their advantage?

Are we contrarions on just this issue, based on the perculiar set of mismatched data, or do we see holes in other things?

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This contrarion view being the exact opposite of sheeple mentality.

I would therefore describe bears as "thinking outside the box". In this case coveniently we do actually have a box, the box of a house, the box of stability, the constricting box of a large mortgage.

Keeping with the sheeple theme - couldn't we use "thinking outside the pen" :)

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How about: "Living outside the box"?

That has always been an objective of mine, in a world of sheeple.

Gavin, I invite you to come up with other suggestions on how to do that.

BTW,

I am think of calling a mini-summit, a sort of Davos-style discussion day,

for those that might want to discuss: "The future Economy, and how to Live

outside the Box".  I am not sure when and where, but probably in London,

sometime in late August.  (This was inspired by an article I read this morning

on Bill Clinton's plans)

Any interest in this here?

I am interested, although the weekends in late August are difficult. Weekdays may not be suitable for others!

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Are we contrarions on just this issue, based on the perculiar set of mismatched data, or do we see holes in other things?

In Dec 99, I turned down the chance to earn twice as much at a dot.com to go and work for a charity (been there ever since). I could already see the writing on the wall for the dot.com boom.

At lunch, shortly after I started at said charity - plenty of colleagues were pumping me for share tips and I suggested that they all should take any money made and run as soon as possible. Didn't stop me feeling a little sad that some people working at what is generally quite an enlightened place were sheeple.

My job is quite a creative and strategic one so it quite often helps to be able to see (if not always believe in) contrary views.

But thinking outside of the box is a devalued term (usually used by middle managers without any imagination in my experience). Perhaps it is time to reclaim it.

I like living outside the box though.

Edited by greencat

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By definition, contrarians go against the herd, always looking at things that are downbeaten, out of favour. Why? Contrarians recognise that things go in cycles, and that it takes a herd to move the cycle. The contrarian looks at buying in ahead of the herd while it is still cheap to do so. They know that more buyers will drive up the price.

Sheeple take past performance as a guide to future returns, but contrarians know that unfashionable and out of favour sectors have been sold and depressed, and where there are bargains to be found ahead of a cyclical upturn. Remember, markets always go in cycles.

Many people think that contrarians are people who buy when everyone else is selling. That's not really true. For me, the definition of a contrarian is someone who buys when no one else is interested. For every seller there is a buyer, and today's buyer's may become tomorrow's sellers. When nobody else is interested, it means the industry has been through a bear market and is ready for an upturn.

Contrarians would have bought Tobacco shares in 2001 and quadrupled their money, or airline shares in 2004 and doubled their money since. This year's contrarian buys have to be auto manufacturers.

It's a lonely way of investing. Everyone else is doom and gloom about the industry and saying that it's had its day. But always remember.. Sheeple forecast based on past performance, which is not always a guide to futured return. Just as they can never see a possible way that prices could fall in a bull market, they think that prices can never recover after a bear market. But everything goes in cycles. If every industry that went through a bear market never recovered, we'd have no economy left. :)

Edited by Van

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It always goes that when markets turn, the contrarians are first thought of as dissidents. Nutcases. Then you get a few people who agree with them. Then you get the majority of people who agree with them, and eventually you can't find anyone who disagrees with them.. by which time they market has been through the worst and the contrarians are busy doing a 180-degree U turn :)

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Are we contrarions on just this issue, based on the perculiar set of mismatched data, or do we see holes in other things?

I am often contrarian in other areas and I like to be at least a devil's advocate if not downright obstinate. Check out my views on swearing in the pinned swearing thread.

http://www.housepricecrash.co.uk/forum/ind...ndpost&p=160659

I think it is a lot of fun when accepted wisdom is proven to be foolish. I describe it as "the world turned upside down", which comes from the English Civil War I think.

The reason I think this is that "accepted wisdom" is a failure of responsibilty. Everyone has faculties of reason. If you do not use them then you are to blame if things go wrong. You have to take responsibility for your own opinions and reason them out. If you look at all the facts and arguments today and objectively decide that prices will rocket, you are taking responsibility so that is good. If you sell up because someone you respect told you that things are going to crash and you follow them without looking at the arguments, you have in a sense failed as a human being.

A related abdication of responsibilty is believing or saying something because you want it to be true. I think Sartre described this simply as "bad faith", you might also call it expediency. We see a lot of that on this forum too!

The house price debate is a fascinating cauldron of reason battling against sheeple-ness (on BOTH sides) which is why I am so addicted to it.

frugalista

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How about: "Living outside the box"?

That has always been an objective of mine, in a world of sheeple.

Gavin, I invite you to come up with other suggestions on how to do that.

BTW,

I am think of calling a mini-summit, a sort of Davos-style discussion day,

for those that might want to discuss: "The future Economy, and how to Live

outside the Box".  I am not sure when and where, but probably in London,

sometime in late August.  (This was inspired by an article I read this morning

on Bill Clinton's plans)

Any interest in this here?

Sounds a great idea Dr Bubb and would to attend, although late August is difficult as on holiday.!

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I will probably aim for a long friday lunch, or a saturday picnic.

Loose, but with a small agenda: 3-5 minute briefings from various people,

on their "pet subjects"

superb idea! I am unlikely to be on holiday as I have fallen behind at work due to spending too much time on here!

interesting points about the "safety box" though... as Western economies grind toward crisis, the bubbles seem to be working their way backward up the risk chain... from equities, through housing... then gold?

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Guest Charlie The Tramp
It always goes that when markets turn, the contrarians are first thought of as dissidents. Nutcases. Then you get a few people who agree with them. Then you get the majority of people who agree with them, and eventually you can't find anyone who disagrees with them.. by which time they market has been through the worst and the contrarians are busy doing a 180-degree U turn :)

Thanks for those two posts Van I learn more every day. <_<

Not like those bulls. :P

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Re the catchphrase.

Bearing in mind how "hairy" a position those still entering the property market are putting themselves in. How about this phrase for STRs...

"withdrawing from the extremely hairy box"

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Blindly buying because other are eager to sell will get you in too soon.

You have to wait for prices to stop falling, and the transaction volume to dry up

A real life example:

Buying puts on the US stock market two weeks ago, and on FTSE (again)

on Friday.  Little interest in puts, Option vols are low, and have been for a long time

Chart: Implied Volatility on SPX options:

DrBubb, I have been building my short positions slowly over the last 2-3 weeks, with the aim of being almost fully "market neutral" some time this month. I have in the past used a combination of puts and naked shorts on the major indices, but at the moment am veering towards straightforward shorts, which make the calculations a bit easier. I'm not yet an experienced trader (in fact I've been a pretty awful trader so far this year), and am still developing my own trading style that compliments my longer term investment positions.

Just have a suspicion that we are going to see a nasty shakeout some time very soon. The market has gone from such an oversold position at the end of May to as overbought as we have seen in the last 5 years.

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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