Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Rationalizing Lunacy

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There is one realm of my life in which I feel an utter kinship with equity permabulls: Bay Area Real Estate. See, most of my net worth is based on it. My cost basis is very, very low, because I bought it cheaply a long time ago, and for my entire adult life, all I’ve heard about is how overpriced it is, how it’s going to crash, and how stupid I am not to sell it Right This Second. So, believe me, I have a certain amount of sympathy for owners of, say, NVDA or AMZN listening to yo-yos like me telling them to dump their shares ASAP and being wrong forever.

I thought about this because of a recent full-page ad that appeared in our local paper for a real estate firm that put together an ostensibly objective study about prices in these parts. I’m going to share it below and then say a few words afterward………….

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Bet the House

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If you believe, as I do, that real estate is going to be in trouble, I have three ETFs to suggest as long term (let me put that in caps……LONG TERM) bearish positions. This is not a 0DTE trade. This is something which I think will be good for months to come.

The first, XHB, is mashed up against the top of an extremely long-term price channel. Let’s just say it’s got plenty more open air beneath it than it does room to roam above it.

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The IYR Fibs

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Fibonaccis are cool, but they only seem to work with a handful of financial instruments. It tends to be a hit-and-miss game to figure out which these are. In my estimation, one of the most “obedient” financial instruments with respect to Fibonacci Retracements is the IYR, the real estate ETF. We have seen these lines provide potent levels of support and resistance for literally years at this point. The most recent occurred on Friday, when it blasted right up to its 78.6% level, which it hasn’t visited in 27 months (!).