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Strategies & Market Trends : John Pitera's Market Laboratory

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To: russet who wrote (6107)	5/16/2002 2:20:00 AM
From: macavity	Read Replies (1) of 33421

There is a similar situation in the UK. -Banks are giving 90% and 95% mortgages there as well. -Between 25% and 33% of new mortgages are for 'Buy-to-Let'. -The Banks are also fixing (upto 3 yrs) mortgage rates (they are usually floating in the UK as opposed to fixed as in the US) at rates that cannot be seen at any point of the yield curve c.f. 3% GDP. In short 'everyone wants in' and the banks are only too pleased to lend. In UK property represents a far larger proportion of net worth than anywhere else. (Island nation mentality - I suppose). Historically housing usually has topped anything from 20 -30 mths after stocks, so I guess we are in that region now. Yup, the bubble has moved, but then again it always does. I am not sure where the next one will be, but I reckon we may get a good multi-year rally in commodities. I am not sure that this will turn into a bubble due to the amount of protectionism in the air at the moment, but you never know. -macavity (wishing I had not sold my gold shares in april)

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