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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (63113)	6/23/1999 11:16:00 PM
From: Joan Osland Graffius	Read Replies (1) \| Respond to of 132070

MB, >>If they are not borrowing to buy stocks, then they are borrowing to buy food while they use their food money to buy stocks. I suspect most of this money is being spent on goods and services. What is of interest to me is folks my age should have their house free and clear of a mortgage, at least our close associates do. These folks are retired or getting ready to retire. Which tells me there could be a fair amount of zero or minus equity in some real-estate. Joan

To: Knighty Tin who wrote (63113)	6/24/1999 8:13:00 AM
From: valueminded	Read Replies (1) \| Respond to of 132070

Mike: I did not realize the number was that good. I had thought I was doing fairly well which I guess points to the good job that the debt purveyors do in terms of advertising. Most people I know are in the 75%-90% loan to value numbers. (age group 30-45) and from the advertising, I would suspect that many more are in the 95%+ range. A testimony to the selling power of debt. Is it possible that the reason for a large decrease in equity may be the strong housing market itself. As the market for "new houses" increases many people pull equity out of their "old" house and move to a newer one. The equity finds its way to vacations, cars, stocks etc. It looks like I waited to long for my bounce on interest rates. However, since I still see 8+% by year end, I can be patient waiting for a pullback. One point of disagreement which is why I feel bonds are falling is that debt liquidation going to happen. It is painful and if a deflationary environment presents itself, we will mitigate the pain by applying the political solution to inflate the fixed portion of the debt away at the expense of fixed income market. imo