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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: RockyBalboa who wrote (98823)1/3/2008 2:21:35 PM
From: GSTRead Replies (1) of 306849
 
<only after the bubble burst, the general unwinding of excess credit depressed prices of all assets including those ones which havent been bid up earlier>

The end of the story as you tell it would be depressed prices -- many people seem to have difficulty understanding why this is not to be our destiny. What we have had, and still have, is a US dollar currency bubble -- and when this mother of all bubble breaks you will need a wheel barrel of US dollars to buy a loaf of bread. That is not depressed prices -- it is depressed people who suddenly find out what the consequences are of living beyond their means by borrowing like there is no tomorrow and running a huge current account deficit in a global economy. Almost anybody who has lived in a third world banana republic knows this -- but the USA has not yet learned this lesson, and neither have most people who follow the markets.
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