QUOTE (Pheenix @ Oct 10 2010, 07:59 AM) Hey W.B.
I am always reluctant to discuss the unemplyment figure during times of economic stress without looking at the participation rate.
The US Department of Labor`s, Oct 8 release shows this as 58.5%, which is down from approx 66% in 2005 according to wikipedia. That means (without detailed analysis) 7.5% of the Labor force cohort, has joined the military or are neither `employed` nor `unemployed` (by definition).
http://www.bls.gov/news.release/pdf/empsit.pdf
So 7.5% plus the 5.6% who are officially unemployed (9.6% of 58.5%) you get a figure of 13.1 which is close to
M. Spitzer`s 12.9 - who should have a better methodology than this crude calculation.
...
Prudence and caution, can be driven by wisdom and experience not necessarily fear, and nothing is riskless.
When we talk about postive cash flow, it means that your current operating income is sufficient to pay the bills and have a bit of a safety cushion in case income falls or costs increase.
But it does not tell you whether you make money or better how fast your net worth goes up. That you measure as a rate - Rate of return on your invested money or ROI. The strange thing is, whether you invest in gold, bonds, the stock market, the ROI always seems to swing back to a current average. Depending on the time and sweat you put in your investment you may get better returns.
The current `average return on investment` is a the middle ground of a range of ROIs. The ROI on low risk investments like a GIC is low and that of high risk Junk Bonds high. In other words, high risk often spells high ROIs. Investing in the U.S. is high risk and if your investment survives it may give you a very high return or in otherwords, you would make oodles of money. If it does NOT survive you may loose all and in some cases evenmore.
There is room for high risk investments in every investor`s portfolio as long as you have enough to cover the losses of such an investment and to `to fight another day`.
Young people have many days left `to fight another day`; old geezers like myself have less and tend to be more conservative in their overall investment behaviour.
I think previous posters and many others on this website including Don Campbell have extensively pointed out the risks of investing in U.S. Real Estate right now. The choice and the responsibility for the result are yours.