The Residential Real Estate Crash Index Message Board

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Strategies & Market Trends : The Residential Real Estate Crash Index

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To: tejek who wrote (260793)	7/14/2010 4:12:07 PM
From: RetiredNow	Read Replies (2) of 306849

They have it wrong. 60% of China's GDP is from government paid for construction projects. The US gov't spent tens of billions on shovel-ready construction projects in the US over the last year. You think any of that will last? These construction firms are delusional if they think the last years growth rates and this last quarter's performance represents a sustainable trend. This is what I'm telling you. The market is not pricing in the reality that any growth we experienced over the last year was from a golden confluence of massive, global, fiscal and monetary stimulus that is now coming to an end. Once it does, all that remains is organic growth plus any continuing deficit spending growth, which is already coming down due to European austerity packages. I'm looking dead ahead and what I see is a severe contraction in the second half of 2010 and 2011, unless the globe decides to act in unison again and pump more stimulus into the world's economies. I sincerely hope they do NOT do that and that instead they let the global economy find its own organic equilibrium. That is the only thing that will lead to sustainable growth going forward, after a sharp correction.

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