Transcript Investment Seminar Presenters: Steve Hawks

Fed Lowered
rates 2001
Average home
buyer was
becoming
speculator 2005
Institutions
wanted higher
return 2003
Money was being
thrown at
originators 2004
Loan guidelines
not enforced
Some builders
began to offer
100k cash back,
pay off debt 2006
Whole
subdivisions were
wiped out
2006-2007
Spilled into resale
market
2006-2007
Ponzi schemes and
scams began to
unravel 2007
These values were
used by the average
homeowner to
Refinance
The cancer spreads
Sub prime collapse
Oct. 2007
No options left
No government
programs can help
2010
 Market
booms from tax credit
 Falls right back down again
 Pulled Demand Forward
2011 Buy Buy Buy
State Policies Laws limit inventory
 Federal lower rates accounting changes

$38 OF DEBT NOW $1 GDP
QE HAS LOST ITS JUICE
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Government realized they must utilize this
option
Short sales are increasing by triple digits
year over year
Banks to take Real Time loss
Short sales less of a loss and cost
House not left empty
Eliminates living units, artificial shortage
All government programs will fail with out
principal reduction
Fed Admits Policy Causes
“ ASSET BUBBLES”

*WILLIAMS SAYS POLICY MAY YIELD ASSET
BUBBLES, UNINTENDED RESULT
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*YELLEN : POLICY DOES HURT SAVERS
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*PAULSON: CURRENT POLICY WILL CAUSE CRISIS
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* SCHWAB: WE ARE IN A MANIPULATED MARKET
BIGGEST DROP IN 40 YEARS!
The Hedge Fund Landlord
ERA
Rental housing has long been a
decentralized, locally owned industry
No Mom and Pop real estate investor can
compete with financial institutions who can
borrow unlimited sums of money from the
Federal Reserve at near-zero rates of
interest

At 4%, the price $400,000, with a 30% down of
$120,000 and a mortgage of $280,000, and the
mortgage accrues the same $11,200 in annual
interest.
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Imagine being able to borrow $400,000 at 1% with
zero collateral. You can now buy the rental
property for cash, and pay only $4,000 in simple
annual interest.
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Now multiply the $400,000 and the $7,000 by
1,000. Now you can buy $400,000,000 of rental
properties and skim $7,000,000 in annual profits,
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