{"id":176001,"date":"2025-04-07T18:37:02","date_gmt":"2025-04-07T18:37:02","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/finance\/sacrificing-the-stock-market-for-the-good-of-your-loving-home\/"},"modified":"2025-04-07T18:37:02","modified_gmt":"2025-04-07T18:37:02","slug":"sacrificing-the-stock-market-for-the-good-of-your-loving-home","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=176001","title":{"rendered":"Sacrificing The Stock Market For The Good Of Your Loving Home"},"content":{"rendered":"


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As stocks plummet and recession fears grow, there\u2019s one silver lining worth highlighting: the increasing value of your home, if you own one. A home is a fundamental necessity for survival, stocks are not. So, the government sacrificing your stock portfolio to strengthen or preserve your housing situation can be seen as a net benefit.<\/p>\n

Many of us are scratching our heads wondering why President Trump and his administration would intentionally tank the stock market and push the economy into a recession with new tariffs. After all, about\u00a062% of Americans own stocks\u00a0in some form, according to Gallup<\/a>. Meanwhile, the poorest citizens get squeezed the most since they spend the highest percentage of their income to survive.<\/p>\n

But\u00a066% of Americans own homes, per the U.S. Census Bureau<\/a>. Since more people own homes than stocks\u2014and a home provides essential shelter\u2014it stands to reason that real estate is\u00a0far more important<\/em>\u00a0than stocks. If that\u2019s the case, it\u2019s also logical to allocate more of your net worth toward real estate than equities.<\/p>\n

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Don\u2019t Fight the Government or the Fed, Who Prefer Real Estate<\/h2>\n

Since 2009, I\u2019ve been in the real estate vs. stocks debate<\/a>. I invest in both, but I\u2019ve long preferred real estate\u2014ever since I was a 32-year-old launching Financial Samurai. Now, at nearly 48 with a family to support, I still do.<\/p>\n

Let\u2019s not forget: I worked in equities at Goldman Sachs and Credit Suisse from 1999 to 2012. I\u2019ve lived through enough bubbles and crashes to know stock market volatility lowers my mood. With stocks, you can be up big one day and down even more the next. A year’s worth of gains can be wiped out in a month or less. Real estate, on the other hand, is far more slow and stable.<\/p>\n

The government clearly favors real estate. Why fight that? The Trump administration wants a lower 10-year Treasury yield to reduce interest payments on national and consumer debt. A lower yield also leads to lower mortgage rates, which enables more Americans to refinance or buy homes. Of course, if they go too far and cause a spike in unemployment, the whole strategy could backfire.<\/p>\n

My goal for this post is to help those who dislike real estate see it in a better light. It isn’t to bash stocks. Real estate is my favorite asset class<\/a> for the typical person to build long-term wealth. The combination of rising rents, rising property prices, and declining mortgage balances is a powerful wealth creator.<\/p>\n

However, I feel like I’ve been losing the argument over the years to my peers who promote being 100% invested in stocks and renting. So I’d like to use this latest market meltdown as a way to bring more balance<\/em> to the debate. <\/p>\n

Treasury Secretary Scott Bessent’s View On Helping The Middle Class<\/h2>\n

To better understand Trump and Bessent\u2019s ideology on disrupting the stock market to help the middle class, here\u2019s a short interview clip. Treasury Secretary Bessent points out that the top 10% own 88% of all stocks, while the bottom 50% primarily hold debt. <\/p>\n

As a result, they\u2019re trying a different approach to provide meaningful relief to the middle class<\/a>. Unfortunately, at this pace, the middle class will be negatively impacted the most with rising mass layoffs.<\/p>\n

Note: if you are particularly sensitive to politics or people like Tucker Carlson, please try not to shoot the messenger. My goal is to understand why the Trump administration is doing what they are doing so we can make better decisions going forward.<\/em> A savvy asset allocator must put their emotions aside.<\/em><\/p>\n

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Treasury Secretary Scott Bessent Tells Tucker Carlson, <\/p>\n

\u201cI Don\u2019t Think The Bottom 50% Of Americans Are Losers. I Think The System Hasn\u2019t Worked For Them. I Think That They Are Winners. It\u2019s Just A Bad System.\u201d pic.twitter.com\/Wtpv7Zkf8k<\/a><\/p>\n

— \ud835\udd41\ud835\udd3c\ud835\udd3d\ud835\udd3d\ud835\udd3c\u211d\ud835\udd4a\ud835\udd46\u2115\ud835\udd4a \ud835\udd4d\ud835\udd40\ud835\udd46\ud835\udd43\ud835\udd40\u2115 (@Rust_And_Decay) April 4, 2025<\/a><\/p><\/blockquote>\n