About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

21 comments:

  1. 1
    Shoeguy says:

    Look how well Wall Street is doing. Now look how well Main Street is doing.

    Ask yourself the Poll question again.

  2. 2
    Blurtman says:

    No bubble. The system is transparent and fair. Stop questioning things.

  3. 3

    RE: Shoeguy @ 1

    The American Stock Market Thrives Today With Outsourced Labor

    And welfare QE buying of federal assets. This seems to keep interest rates low and makes the stocks attractive at the same time. Stocks seem to like oil price increases too….my guess is the base product depends on energy [oil], so goes up….then they tack on profit to a higher cost base due to higher energy, making a constant profit percent higher too [until we can’t afford their products anymore due to increased inflation].

  4. 4
    john says:

    While the stock market might appear to be inflated, bubble may not be correct.
    We have had years of currency devaluation, perhaps it is hard to see as others have pursued the same course of action. So I would expect to see inflation of a number of assets.
    The US gov is forcing money to do something , anything other than remain idle in banks. On going inflation along with zero interest rates means investors have almost no choice but to put money into various asset classes such as stocks, property etc.

  5. 5

    RE: john @ 4 – And avoid most bonds.

  6. 6

    RE: Kary L. Krismer @ 5

    Bonds go up with lowered interest rates….they haven’t done that bad this YTD….but you’re right, assuming the QE beer party is over and real estate mortgage rates on the verge of escalation [with saving interest rates]….bonds will plummet with home values…

  7. 7

    RE: john @ 4

    The Rich Are Hoarding Cash Money Right Now

    They don’t trust any type of investment.

  8. 8
    Shoeguy says:

    RE: softwarengineer @ 7 – Yup. Buffett is hoarding cash and Soros is shorting the market.

    Even mainstream cheerleader economists are starting to ring warning bells. Economic fundamentals were never fixed after the 2008 crash. The Fed simply started printing cash, artificially driving up house prices and the stock market while driving down interest rates to dangerous levels.

    The 1% has gotten filthy rich from the Fed’s money printing while real wages continue to stagnate at 1995 levels. Meanwhile, what will happen to house prices when interest rates go from 4.5% back up to 7%?

  9. 9
    Blurtman says:

    “…when interest rates go from 4.5% back up to 7%?” At the end of the day….is a new day.

  10. 10
    pfft says:

    By Shoeguy @ 1:

    Look how well Wall Street is doing. Now look how well Main Street is doing.

    Ask yourself the Poll question again.

    the stock market is about companies, not about wall street or main street.

  11. 11
    pfft says:

    By Kary L. Krismer @ 5:

    RE: john @ 4 – And avoid most bonds.

    if stocks go down money will rush into bonds. I have been paying attention to the stock market since 1999 I’d I have never heard more than a handful of people recommend bonds. it’s been 15 years of “rates have nowhere to go but up.”

  12. 12
    pfft says:

    By Shoeguy @ 8:

    RE: softwarengineer @ 7 – Yup. Buffett is hoarding cash and Soros is shorting the market.

    Warren is always holding cash and we don’t know if Soros is just hedging.

    It’s cut to hear you guys talk about the stock market.

    Tim we need to know what a bubble is. To me that means stocks will fall at least 40%.
    Once we define a bubble we need to add a time parameter. When will stocks fall? The stock market could fall 50% but from what level? from dow 21,000?

  13. 13
    pfft says:

    I voted probably no only because while companies are profitable now main street hasn’t fully recovered. When main street recovers the economy and market will really take off.

  14. 14
    Scotsman says:

    …when main street recovers…… And when might that be? When the average American wage- adjusted for inflation- has been falling for decades, when there is a smaller percentage of the population employed in “living wage” jobs than at any time since the 1960’s, when increases in productivity are expressed as reduced employment, not wage increases….. There won’t be a “recovery.” There will be stabilization at the new normal, a very different thing. The hoped for results of Fed pumping- a rising stock market and the resultant wealth effect that frees spending can’t happen when debt loads and carrying capacity are already maxed out. The market can’t continue to go up forever while income/spending at the consumer level remains flat. Smoke and mirrors waiting for a gentle breeze to clear the way for reality.

  15. 15
    pfft says:

    By Scotsman @ 14:

    …when main street recovers…… And when might that be? When the average American wage- adjusted for inflation- has been falling for decades, when there is a smaller percentage of the population employed in “living wage” jobs than at any time since the 1960’s, when increases in productivity are expressed as reduced employment, not wage increases….. There won’t be a “recovery.” There will be stabilization at the new normal, a very different thing. The hoped for results of Fed pumping- a rising stock market and the resultant wealth effect that frees spending can’t happen when debt loads and carrying capacity are already maxed out. The market can’t continue to go up forever while income/spending at the consumer level remains flat. Smoke and mirrors waiting for a gentle breeze to clear the way for reality.

    weren’t you the one who said the stock market would finish a particular year below 10,000?

    “The hoped for results of Fed pumping- a rising stock market and the resultant wealth effect that frees spending can’t happen when debt loads and carrying capacity are already maxed out.”

    but it already has. the market has recovered DURING a deleveraging. You are wrong anyway, debt levels are at something like 20 year lows.

    what I’ve also learned over the last 15 years is that everyone has their own idea why the stockmarket can’t do XYZ because of ABC.

    their is no fundamental story out there for a stock market crash. there is nothing impacting the economy that is on the scale of the tech bubble or the housing bubble. what do we have? farmville and facebook?

  16. 16
    masaba says:

    A bubble? I don’t think so. The stock market is a high variance investment engine, and wild swings in its value are the norm. Stocks may be at one of those high points right now, but no, not a bubble. In fact, “bubble” has become so overused in the financial industry and blogs like this that the word carries little meaning at this point.

  17. 17
    ongsomwang says:

    By pfft @ 15:

    By Scotsman @ 14:

    …when main street recovers…… And when might that be? When the average American wage- adjusted for inflation- has been falling for decades, when there is a smaller percentage of the population employed in “living wage” jobs than at any time since the 1960’s, when increases in productivity are expressed as reduced employment, not wage increases….. There won’t be a “recovery.” There will be stabilization at the new normal, a very different thing. The hoped for results of Fed pumping- a rising stock market and the resultant wealth effect that frees spending can’t happen when debt loads and carrying capacity are already maxed out. The market can’t continue to go up forever while income/spending at the consumer level remains flat. Smoke and mirrors waiting for a gentle breeze to clear the way for reality.

    weren’t you the one who said the stock market would finish a particular year below 10,000?

    “The hoped for results of Fed pumping- a rising stock market and the resultant wealth effect that frees spending can’t happen when debt loads and carrying capacity are already maxed out.”

    but it already has. the market has recovered DURING a deleveraging. You are wrong anyway, debt levels are at something like 20 year lows.

    what I’ve also learned over the last 15 years is that everyone has their own idea why the stockmarket can’t do XYZ because of ABC.

    their is no fundamental story out there for a stock market crash. there is nothing impacting the economy that is on the scale of the tech bubble or the housing bubble. what do we have? farmville and facebook?

    That does not change the fact that mainstreet has not fully recovered from the decline we have seen this past decade.

    As a millinieal the decline has impacted us the most. I see it everyday when I talk to other young adults who carry heavy debt loads in relation to their level of education, and salary.

    I don’t care how great the stock market is doing, it has no bearing anymore on the vast majority of Americans.

  18. 18
    redmondjp says:

    By ongsomwang @ 17

    “. . . I don’t care how great the stock market is doing, it has no bearing anymore on the vast majority of Americans.”

    That is not a true statement. For many of us that are a bit older than you (baby boomers and gen x-ers), the bulk of our retirement savings are in the market. A market correction can easily have a six-figure impact on one’s total retirement savings. Sure, it’s easy to say that being in the stock market is foolish for retirement purposes, but when you have no other choice that will provide returns great enough to even keep up with inflation, what is an invester to do? You just can’t fight the Fed . . .

  19. 19
    Shoeguy says:

    By pfft @ 10:

    By Shoeguy @ 1:

    Look how well Wall Street is doing. Now look how well Main Street is doing.

    Ask yourself the Poll question again.

    the stock market is about companies, not about wall street or main street.

    wow…..not sure if serious…..

  20. 20
    ongsomwang says:

    @redmondjp

    What % of the population owns a significant amount of stock? Most of those who particpate in 401(K) plans have paltry sums. Most financial assets are concentrated with those who are doing pretty well.

    Generation X, and Y are not putting money in 401(K) plans with the same idealism of their predecessors. You are correct in stating that a market correction will impact lots of boomers. But I am just pointing out the fact that this market is totally disconnected from reality. How long can that go? Maybe a few more years. There is no doubt that QE is keeping us afloat. And I hope it works longer, but longterm I am not so confident.

    And you are correct. Right now you can’t fight the Fed.

  21. 21
    Nick says:

    Stocks are cheap. Advancing technology allows companies to produce more with less labor. That’s called growth.

    The falling value of unskilled labor in the US is irrelevant. It was merely a temporary aberration caused by the economic disruption of WWII. The economy is global now. There is an entire planet of new middle class to sell to.

    So: more global demand for products + more efficient production = growth for business.

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