Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: carranza2 who wrote (65162)	6/17/2005 3:51:33 PM
From: Maurice Winn	Read Replies (1) of 74559

But C2, inflation is house prices rising, so it's not under control. Certain measured components of inflation are under control [thanks to China maths and India undercutting and a LOT of them wanting to improve their lives]. But a LOT of pixelation of brand spanking new US$ [yen, yuan etc] has been done and there's more where that came from. That's inflation - those chickens have to come home to roost each night. No wonder interest rates are going down, not up. Everyone is heading for cash! Too bad about the low interest rates = they want to hold cash. I have my stash of cash too. There's nothing wrong with debt. It's just negative money. The debtor just has to keep on producing. Debt guarantees production. Debt is good. It brings the future into today. Graphs like TOL and HOV look very bubbly to me, but so far, the shorts are being pummelled. Everyone says it's a no-brainer to short housing. I find no-brain investing hazardous to my health. In NZ$, US houses haven't gone up in price. It's not a housing bubble, it's a debt bubble. What matters is how those debts are resolved. Maybe they'll simply be paid back over 30 years. Maybe they'll be pixelated away by Uncle Al KBE and successors and those holding the cash will be the suckers holding the bubble. The pixelation process is the real bubble. Houses aren't bubbles, they are places to live. When I introduce my new money and all other currencies go to zero, the debts will be resolved too and the holders of cash will be holding an anachronism worth exactly nothing. Owning a house will be better than owning a disappearing currency. Having a 30 year debt on the house at some fixed low rate would be good too. Having large variable debt might be dodgy. Mqurice

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