The Epic American Credit and Bond Bubble Laboratory Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: patron_anejo_por_favor who wrote (26264)	2/11/2005 12:28:48 PM
From: mishedlo	Read Replies (2) of 110194

What everyone misses about that housing inflation is that the vast majority of those people already had their house. For MOST people that have owned their house for the lst 5 years or so have not seen or felt the affect of those increases. Obviously new home buyers have but that is the minority. Have you bought a home in the last 5 years? If not, have your expenses other than property taxes gone up? What everyone misses is the deflationary aspect of this: People treating their houses like an ATM and going deeper in debt to finance stuff because of perceived new wealth. When the bust happens I just do not know. That it WILL happen I do know. Expansion of credit will end the way all such expansions end: In a credit bust. Unless and until wage growth keeps up with purchases, this extra debt will be deflated away. Wage growth isn't going anywhere so there is not other option than a credit collapse. All credit bubbles end the same way: They implode. There is no rule that says higher interest rates are required to prick the bubble. Mish

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next