I’ve written before that I value Elliott Wave analysis for it’s theoretical value more than it’s practical value. I simply haven’t found that it can be applied rigorously with any accuracy. I believe it’s value is in it’s concepts, more loosely applied.

One of the fundamentals of Elliott Wave analysis holds that corrective waves (in contrast to impulsive waves) follow an A-B-C pattern, as shown in the long-term chart of GE above. The A and C waves usually mirror each other.

Both the A and C waves in this example equal roughly 30 points. In addition, wave B retraced 61.8% of wave A. Both 0.618 and 0.382 (it’s inverse) are very important numbers to EW analysis as the basic theory states that the golden ratio (and it’s inverse) is pervasive in natural systems.

Elliott Wave practitioners would point to this example of GE as proof of the system’s predictive ability. I simply find it fascinating, as I do the popular novel featuring the golden ratio, “The Da Vinci Code.”

I’ve written before that I value Elliott Wave analysis for it’s theoretical value more than it’s practical value. I simply haven’t found that it can be applied rigorously with any accuracy. I believe it’s value is in it’s concepts, more loosely applied.

One of the fundamentals of Elliott Wave analysis holds that corrective waves (in contrast to impulsive waves) follow an A-B-C pattern, as shown in the long-term chart of GE above. The A and C waves usually mirror each other.

Both the A and C waves in this example equal roughly 30 points. In addition, wave B retraced 61.8% of wave A. Both 0.618 and 0.382 (it’s inverse) are very important numbers to EW analysis as the basic theory states that the golden ratio (and it’s inverse) is pervasive in natural systems.

Elliott Wave practitioners would point to this example of GE as proof of the system’s predictive ability. I simply find it fascinating, as I do the popular novel featuring the golden ratio, “The Da Vinci Code.”

I’ve had a fair number people ask me recently about some of the new technologies I’ve been using over the past few months and I thought I’d just share them with you here:

Lately, I’ve been into all things Google. I now use GMail, Google Calendar, Google Talk and own a G1 (Google phone). Because they are all internet based I no longer have to worry what information is on what device and how to synchronize it all. All the information I need is always at my fingertips no matter what device I’m using.

Speaking of synchronization, I’ve also been using Mozilla’s Firefox browser with Foxmarks. It synchronizes my bookmarks between my desktop and my laptop, an invaluable service for me as I switch between both machines constantly.

Another Firefox plug-in I really like is Wisestamp. It provides a customizable email signature that allows you to include links to sites like LinkedIn, and Blogger. Below is an example:

Jesse Felder
Felder & Company

T +541-389-3345
F +541-389-3326
E jesse@felderandcompany.com

Contact Me:

But the coolest thing I’ve been using for the past year or so is Twitter. Some call it “microblogging” but I don’t think that really does it justice. I like to think of it as blog comments or a message board on ‘roids. It’s a non sequitur paradise.

Some of my favorite Twitter tools are:

-Mr. Tweet: helps you find new and interesting people to follow
-Twitter Karma: helps organize your followers and who you’re following
-TweetDeck: hands down the best twitter client out there

Follow me @jessefelder

Probably the one new service I am most eagerly anticipating right now (shameless plug to get an early trial?) is Gist. From the company: “Gist is an online service that helps you build stronger relationships. By connecting your inbox to the web, you get business-critical information about key people and companies.”

Play it, Johnny.

My Favorite Things – John Coltrane

UPDATE:

I just got my invitation to the Gist beta from robert@gist.com (@robertatgist on Twitter) and I already love it. It brings together all of your contacts from Outlook, FaceBook, LinkedIn and GMail into one, user-friendly interface.

When you pull up a contact page you can see a history of your recent correspondence with them, links and attachments you’ve shared and any relevant news for that person in addition to their contact information – brilliant, and long overdue. Here’s what Gist Ceo, Tom McCann’s contact page looks like:

Bravo, Gist.

Send Robert an email for your own invitation to the Beta at Robert@Gist.com

I’ve had a fair number people ask me recently about some of the new technologies I’ve been using over the past few months and I thought I’d just share them with you here:

Lately, I’ve been into all things Google. I now use GMail, Google Calendar, Google Talk and own a G1 (Google phone). Because they are all internet based I no longer have to worry what information is on what device and how to synchronize it all. All the information I need is always at my fingertips no matter what device I’m using.

Speaking of synchronization, I’ve also been using Mozilla’s Firefox browser with Foxmarks. It synchronizes my bookmarks between my desktop and my laptop, an invaluable service for me as I switch between both machines constantly.

Another Firefox plug-in I really like is Wisestamp. It provides a customizable email signature that allows you to include links to sites like LinkedIn, and Blogger. Below is an example:

Jesse Felder
Felder & Company

T +541-389-3345
F +541-389-3326
E jesse@felderandcompany.com

Contact Me:

But the coolest thing I’ve been using for the past year or so is Twitter. Some call it “microblogging” but I don’t think that really does it justice. I like to think of it as blog comments or a message board on ‘roids. It’s a non sequitur paradise.

Some of my favorite Twitter tools are:

-Mr. Tweet: helps you find new and interesting people to follow
-Twitter Karma: helps organize your followers and who you’re following
-TweetDeck: hands down the best twitter client out there

Follow me @jessefelder

Probably the one new service I am most eagerly anticipating right now (shameless plug to get an early trial?) is Gist. From the company: “Gist is an online service that helps you build stronger relationships. By connecting your inbox to the web, you get business-critical information about key people and companies.”

Play it, Johnny.

My Favorite Things – John Coltrane

UPDATE:

I just got my invitation to the Gist beta from robert@gist.com (@robertatgist on Twitter) and I already love it. It brings together all of your contacts from Outlook, FaceBook, LinkedIn and GMail into one, user-friendly interface.

When you pull up a contact page you can see a history of your recent correspondence with them, links and attachments you’ve shared and any relevant news for that person in addition to their contact information – brilliant, and long overdue. Here’s what Gist Ceo, Tom McCann’s contact page looks like:

Bravo, Gist.

Send Robert an email for your own invitation to the Beta at Robert@Gist.com

The chart above, courtesy of the Bratton Report, shows the awesome decline in Bend home prices over the past few years. We’ve now seen home prices here in town fall over 40%!

Today the Wall Street Journal ran a piece arguing that, “the relative cost of owning versus renting is swinging back in favor of homeownership in some U.S. markets, buoyed by several quarters of sharp declines in home prices.” Here are the details:

Over the past 18 years, after-tax mortgage payments have averaged 26% more than rent payments, according to Green Street Advisors, a real-estate consultancy based in Newport Beach, Calif. In 2006, at the height of the housing bubble, mortgage payments reached as high as 66% more than rent payments. But by the end of 2008, average monthly rent for the largest 50 metropolitan areas was $1,045, compared with after-tax mortgage payments of $1,300, assuming a rate of 5.5% on a 30-year fixed mortgage. That means mortgage payments averaged just 24% more than rent payments, the narrowest gap since 2001.

Applying the same math to Bend, the median after-tax mortgage payment now amounts to $903 ($233,000 median home price = $186,400 mortgage with an after-tax rate of 4.125% = 5.5% adjusted for a 25% tax bracket) versus median rent of $859. This amounts to a mere 5% disparity which is significantly more attractive than the national average.

After the crash we’ve seen in local home prices this should come as little surprise. However, it doesn’t mean that prices won’t continue to fall.

In fact, according to the measure used by National City (famous for calling Bend the most overpriced market in the country), despite the dramatic decline we’ve already witnessed home prices have another 15% to fall before they become fairly valued:

I guess this is what Mayor, Oran Teater meant when he told the Bulletin over three years ago that, “it used to be that when the state caught a cold, Bend caught pneumonia.” What he didn’t anticipate is that it didn’t just “used to be” like that; it still is. The more things change the more they stay the same.

Ultimately, it makes more sense to buy versus rent today than it did a couple of years ago. There are certainly attractive opportunities out there in the local market right now. However, I still don’t think it makes sense to anticipate a bottom any time soon.

Sources:
Renters Lose Edge on Homeowners
Nick Timiraos
The Wall Street Journal
February 25, 2009

Housing Valuation Analysis
National City/PNC Economics

The chart above, courtesy of the Bratton Report, shows the awesome decline in Bend home prices over the past few years. We’ve now seen home prices here in town fall over 40%!

Today the Wall Street Journal ran a piece arguing that, “the relative cost of owning versus renting is swinging back in favor of homeownership in some U.S. markets, buoyed by several quarters of sharp declines in home prices.” Here are the details:

Over the past 18 years, after-tax mortgage payments have averaged 26% more than rent payments, according to Green Street Advisors, a real-estate consultancy based in Newport Beach, Calif. In 2006, at the height of the housing bubble, mortgage payments reached as high as 66% more than rent payments. But by the end of 2008, average monthly rent for the largest 50 metropolitan areas was $1,045, compared with after-tax mortgage payments of $1,300, assuming a rate of 5.5% on a 30-year fixed mortgage. That means mortgage payments averaged just 24% more than rent payments, the narrowest gap since 2001.

Applying the same math to Bend, the median after-tax mortgage payment now amounts to $903 ($233,000 median home price = $186,400 mortgage with an after-tax rate of 4.125% = 5.5% adjusted for a 25% tax bracket) versus median rent of $859. This amounts to a mere 5% disparity which is significantly more attractive than the national average.

After the crash we’ve seen in local home prices this should come as little surprise. However, it doesn’t mean that prices won’t continue to fall.

In fact, according to the measure used by National City (famous for calling Bend the most overpriced market in the country), despite the dramatic decline we’ve already witnessed home prices have another 15% to fall before they become fairly valued:

I guess this is what Mayor, Oran Teater meant when he told the Bulletin over three years ago that, “it used to be that when the state caught a cold, Bend caught pneumonia.” What he didn’t anticipate is that it didn’t just “used to be” like that; it still is. The more things change the more they stay the same.

Ultimately, it makes more sense to buy versus rent today than it did a couple of years ago. There are certainly attractive opportunities out there in the local market right now. However, I still don’t think it makes sense to anticipate a bottom any time soon.

Sources:
Renters Lose Edge on Homeowners
Nick Timiraos
The Wall Street Journal
February 25, 2009

Housing Valuation Analysis
National City/PNC Economics

The New York Times recently totaled up the government’s bailout tab and found that it amounts to nearly $9 trillion!!! And to think people were pissed off about the original $700 billion Paulson Plan, aka the TARP.

The total of all the new initiatives works out to roughly $75,000 per taxpayer. If you’d rather receive that amount personally or send it to a friend, you can now go to BankofObama.org and cut your own check.

Still, it might be hard to find a bank these days capable of cashing a real $75,000 check, let alone one to make good on phony government paper.

Sources:
Adding Up the Government’s Total Bailout Tab
The New York Times
February 4, 2009

The New York Times recently totaled up the government’s bailout tab and found that it amounts to nearly $9 trillion!!! And to think people were pissed off about the original $700 billion Paulson Plan, aka the TARP.

The total of all the new initiatives works out to roughly $75,000 per taxpayer. If you’d rather receive that amount personally or send it to a friend, you can now go to BankofObama.org and cut your own check.

Still, it might be hard to find a bank these days capable of cashing a real $75,000 check, let alone one to make good on phony government paper.

Sources:
Adding Up the Government’s Total Bailout Tab
The New York Times
February 4, 2009

I’ve been an M. C. Escher fan since I was a kid. I turns out his drawings make for perfect illustrations of the classic cycles within the economy:

(HT, Ritholtz)

Source:
M. C. Escher – Economist
Mark McHugh
Across the Street
February 21, 2009

I’ve been an M. C. Escher fan since I was a kid. I turns out his drawings make for perfect illustrations of the classic cycles within the economy:

(HT, Ritholtz)

Source:
M. C. Escher – Economist
Mark McHugh
Across the Street
February 21, 2009