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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: mishedlo who wrote (19594)12/27/2004 1:30:43 PM
From: Rational  Read Replies (1) of 116555
 
Yes, median affordable home value will drop due to declining incomes, and so the median price of homes traded will drop. But that does not mean that prices of comparable homes will drop. Excessive creation of money (done competitively everywhere) will likely continue while demand for loans will continue to drop, making the cost of capital lower and comparable home prices higher. I also see a drop in the number of homes being sold/started/traded, but not the price of comparable homes.
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