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Can You Spot A Real Estate Bubble?

Joe Samuel

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real estate stocks

You don’t need a great memory to flash back to the last real estate bubble. It was only 10 years ago, a breakdown in the United States housing market and several others across the globe that eventually sent the world into the worst financial crisis since the Great Depression.

If you can recall or if this is a history lesson for the younger crowd, the S&P 500 lost half of its value, the unemployment rate doubled, several investment banks were forced to dissolve or merge in order to survive, and millions of Americans were foreclosed on and lost their homes. Millions of others simply abandoned them as the homes were underwater or worth less than what they owed on their mortgages.

Homebuyers and others, especially in areas with limited housing supply like Silicon Valley, San Francisco, and Los Angeles, may be nervous about the next real estate bubble as home prices are rising. Though there’s no confirmed way to spot a real estate bubble and experts won’t agree on whether one can be identified or not, there are a number of signs that homebuyers and shoppers can follow in order to determine the likelihood of a bubble. Those indicators include:

Interest rates since low rates tend to fuel bubbles.

Home price indexes, a measurement of housing prices for single-family homes in a given location. These offer the easiest way to follow the rise and fall of home prices.

Price-to-rent ratio, which is the ratio of the price of home to the annual rent that it would generate and a measure of affordability of renting versus buying. Lower ratios indicate that buying is cheaper, while higher ratios would signify that renting is the better deal. Price-to-rent ratios tend to rise during a bubble as speculative interest in homebuying lifts home prices.

Determine to what extent rising prices are being driven by speculators rather than residents as housing bubbles tends to be driven by speculators, or investors who are buying homes to turn a quick profit, rather than live in them.

But What is a real estate bubble?

A bubble is simply a sudden increase in the price of an asset class, such as housing, due to increased demand or speculation. Think about the way bitcoin exploded in 2017 and then immediately imploded during the beginning of 2018.

The term is often used when the rise in prices is divorced from the underlying value of the asset and followed by a rapid decline. The bubble is so named for its appearance on a chart as the asset price suddenly rises and then falls, creating the rounded shape of a bubble. A bubble often emerges from supply and demand dynamics becoming imbalanced. When demand for housing exceeds supply, which most often happens in cities with geographic boundaries like San Francisco, Seattle, or New York that have booming economies, prices tend to escalate.

Speculators and other investors may seize on the opportunity, buying housing in order to turn a profit rather than live in the home — a process sometimes called flipping. Eventually, the imbalance tends to correct itself and higher prices drive down demand or supply catches up with the higher level of demand through new construction. Investors don’t generally know when they’re in a bubble or how long it will last, though there are usually critics who recognize it as such.

International Monetary Fund 

According to the International Monetary Fund, real estate bubbles are less frequent than equity, or the stock market, bubbles. Real estate bubbles occur every 13 years on average but last twice as long as the 2.5 years that stock market bubbles last. Real estate bubbles also lead to double the loss in output of the 4% decline in gross domestic product, or GDP, caused by equity bubbles. GDP is defined as the total value of all the goods and services produced by a country, or a similar entity, in one year.

In today’s market, when investors refer to a real estate bubble, they are generally talking about the housing market as that was the most significant driver of the last real estate bubble as well as the financial crisis and remains the biggest concern for homebuyers today.

The impact of the housing bubble’s bursting and the subsequent financial crisis was vast. Lehman Brothers, the investment bank, went under, and several other banks, including Merrill Lynch and Wachovia, had to be acquired by other banks, in their case Bank of America and Wells Fargo, respectively, with the oversight of the federal government. All told, dozens of banks and financial institutions around the globe went bankrupt or had to be acquired. In 2008, there were more than 3.1 million home foreclosures, more than triple the number in 2006, and home prices fell about 30% from their peak in 2006 to their trough in early 2012.

Will we see another bubble burst?

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4 Security Penny Stocks To Watch

A. Lawrence

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As Threats Arise, Security Stocks Take Center Stage In 2019

With the Federal Reserve’s meeting coming, the general market is bracing for anything. Meanwhile, penny stocks are continuing to climb at absurd rates. Trading penny stocks as of late has brought many investors fruitful profits and they look to continue this trend. Here are some security penny stocks to watch for the remainder of June 2019:

Security Penny Stock #1
Liberty Defense Holdings (SCAN.V)
Market Cap: $46.404M

Liberty Defense Holdings Ltd. (SCAN.V) is a security company looking to take the industry into the next century. Liberty’s HEXWAVE product is a 3-dimensional scanning device that can detect weapons and threats of any kind. The product can do this both with speed and discretion ensuring privacy for citizens.

Liberty signed a Memorandum of Understanding with the soccer team FC Bayern München to beta test HEXWAVE in their arena. They join an ever-growing list of places that have signed MOU’s to beta test Liberty’s product. This MOU expands its ability to comply with and test the market requirements for their product internationally.

“The reception to our HEXWAVE product has been fantastic and we are excited about working alongside FC Bayern Munich, a team that is a household name in both Europe and North America, […] Our ability to deploy in both indoor and outdoor settings, with covert and overt applications, sets us apart and has also been driving increasing interest from the market.” 

Bill Riker, CEO of Liberty

Security Penny Stock #2
Magal Security Systems (MAGS)
Market Cap: $101.371M

Magal Security Systems Ltd. (MAGS) provides security solutions both online and physical. Some services provided include identifying potential security problems, integrating new systems, and custom designs for any type of security needs.

Recently, Magal received a $5.5 million contract for its advanced perimeter intrusion detection system. The system prevents people from illegally crossing border fences and walls.

Dror Sharon, CEO of Magal, stated, “Magal is a world leader in perimeter intrusion technologies. Our growing wins of orders such as this – providing sensors for active international borders, is due to the decades of experience that we have in providing systems that have more than proven themselves in-the-field.”


Security Penny Stock #3
Rekor Systems (REKR)
Market Cap: $27.502M

Rekor Systems Inc. (REKR) is a company that has developed surveillance technology to enhance public safety, banking, and traffic management. Primarily, the company takes their advanced software, which utilizes machine learning and upgrades IP cameras to the next level. This reduces the cost when collecting highway tolls and helps manage traffic congestion.

REKR stock chart

Throughout June, Rekor Systems has been gaining recognition and application across the US. On June 3rd Rekor obtained a contract to start deploying its Mobile LBR-2 vehicle recognition systems. After this deployment on the 3rd, the LPR-2 system North Carolina law enforcement placed an order. On June 12th, Colorado highway authorities chose Rekor’s cloud system called NUMERUS to read enhance their license plate reading.


Security Penny Stock #4
BIO-key International (BKYI)
Market Cap: $18.03M

BIO-key International Inc. (BKYI) is a security technologies company that is pushing past the limits of fingerprint scanning. BIO-key provides a plethora of finger scanning products that provide security for your computer, hard drive, and the government. They have a partnership with Microsoft to develop biometric sign-in for Windows 10.

The company recently announced that a foreign defense ministry ordered more BIO-key deployment for secure access to Microsoft applications.

“We were delighted that such a capable and prestigious technology team determined that BIO-key met their security and scalability requirements and have now made follow-on investments to grow their user base.  Defense Ministries are constant targets of cyber-attacks, and we are glad to help them step up authentication to the highest assurance with NIST-verified accuracy and FIPS compliance.”

Jim Sullivan, SVP of BIO

security stocks
Disclaimer: Pursuant to an agreement between MIDAM VENTURES, LLC and Liberty Defense Holdings Inc. Midam was hired for a period from 04/15/2018 – 5/15/2019 to publicly disseminate information about Liberty Defense Holdings Inc. including on the Website and other media including Facebook and Twitter now extended through June 21, 2019. We were paid $350,000 (CASH) for & were paid “0” shares of restricted common shares. We may buy or sell additional shares of Liberty Defense Holdings Inc. in the open market at any time, including before, during or after the Website and Information, provide public dissemination of favorable Information. FULL DISCLAIMER HERE

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Stock Price Pre Market Update – June 19, 2019

Joe Samuel

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Big Investments Are Signaling The Green Light For A ‘Hot Market’ With Cancer-Fighting Stocks

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How Tech Is Making Life Easier?

The Answer Is ONE CLICK Away


Healthcare Penny Stocks To Watch

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Is Palatin Technologies (PTN) A Penny Stock To Buy Or Sell?

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Biotechnology

Is Palatin Technologies (PTN) A Penny Stock To Buy Or Sell?

Joe Samuel

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Will Shares Of Palatin Technologies (PTN) Head Higher As Biotech Stocks Rally This Month?

Biotech stocks are rallying this month.  Despite the “pop and drop” this sector saw earlier in the year, June has been a big month for biotechnology companies and people investing in this sector. 

IBB ETF chart

In fact, the iShares Trust Biotechnology ETF (IBB) has climbed by more than 8% since the start of June. This sector has been famous for producing volatile returns for investors. Furthermore, biotech penny stocks have increased that potential.

Palatin Technologies (PTN) Is A Biotech Penny Stock To Watch

One of the best performing penny stocks in the biotechnology sector this month has been Palatin Technologies Inc. (PTN). On January 2, this penny stock opened the year at $0.71 and has seen a 2019 high of $1.74. What’s more is that even though PTN stock has consolidated, it has continued to trade above $1.20.

So what’s all the excitement about? Palatin Technologies, Inc. is a biopharmaceutical company developing targeted, receptor-specific peptide therapeutics for the treatment of diseases with significant unmet medical need and commercial potential.

The company’s main strategy is to develop products and then form marketing collaborations with industry leaders in order to maximize their commercial potential.

[New Research] Big Investments Are Signaling The Green Light For A ‘Hot Market’ With Cancer-Fighting Stocks

The recent excitement seems to have started in April after the company reported positive top-line results of its oral clinical study of PL-8177. The treatment is designed to address ulcerative colitis and other inflammatory bowel diseases.

“The main objective of the study was to demonstrate release of polymer-bound PL-8177 in the lower gastrointestinal tract after oral administration. Top line data showed favorable pharmacokinetics, and demonstrated PL-8177 was released in the lower gastrointestinal tract, supporting oral administration of PL-8177 using the delayed release polymer formulation.”

New Milestones From Palatine Technologies (PTN) Triggers New Highs

After hitting new highs on May 17th after posting quarterly earnings, shares of PTN stock have consolidated. Regardless, the company continues to progress. Earlier this month the company obtained orphan drug designation for PL-8177. Yes, this is the same one that I talked about above when the company received positive topline results earlier in the year.

Why is orphan drug designation important? This is a good question especially if you’re newer to biotech penny stocks or biopharmaceutical stocks, in general. In the exact words of the FDA:

“The Orphan Drug Act (ODA) provides for granting special status to a drug or biological product to treat a rare disease or condition upon request of a sponsor. This status is referred to as orphan designation (or sometimes “orphanstatus”).”

Essentially it gives companies incentives above and beyond competitors. These incentives include a partial tax credit for clinical trial expenditures, waived user fees, and eligibility for 7 years of marketing exclusivity. The obvious response would be favorable, which has been seen in the market over the past few trading sessions.

Dr. Carl Spana, President and Chief Executive Officer of Palatin Technologies, said in a press release, “Unlike corticosteroids, immunosuppressive agents, and biological therapies targeting specific cytokines or receptors, melanocortin receptor 1 peptides work to resolve chronic inflammations and restore normal immune function. We look forward to initiating clinical trials with PL-8177 for non-infectious uveitis, a high medical need disease with limited treatment options.”

But Here’s Why Palatin Might Be Set For More Excitement

It’s all about sex drive. You read that right. And something that hasn’t really been fully publicized is this “big FDA date.” You see on June 23rd, the application for Vyleesi (bremelanotide), a drug developed by Palatin and licensed to AMAG Pharmaceuticals (AMAG) will be up for review by the FDA as a New Drug.

Vyleesi is a novel melanocortin 4 receptor agonist under evaluation for restoring a natural sexual desire in premenopausal women with HSDD. Think of this like female Viagra. Will this become the sexiest biotech penny stock this month or will stock traders get blue balled?

Like This Article? Check Out: Small Cap Biotech Stocks See Boost From Large Cap M&A

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