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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (12895)	10/5/2004 5:58:39 PM
From: Crimson Ghost	Respond to of 116555

House prices 'to plunge 40%' Jane Padgham, Evening Standard 5 October 2004 HOUSE prices will fall by 30% to 40% during the next four years, one of the City's most successful fund managers has warned. Neil Woodford, who manages funds worth £6bn at Invesco Perpetual, is preparing for a sharp decrease in property prices. His forecast, which he describes as a 'healthy correction', would bring the average price of a home from £153,700 to £92,200. His claims mirror last week's International Monetary Fund report that said UK house prices were out of touch with underlying conditions in the economy. Woodford said consumers' heightened sensitivity to higher interest rates would send prices markedly lower, adding: 'People have borrowed a hell of a lot more money than they have ever borrowed before.' He said that while a house price fall of this magnitude would only bring prices back to where they were 18 months ago, even that would hit the economy. Woodford said he was steering clear of companies linked to the housing market, construction, retailing and banking. He has invested heavily in stocks such as tobacco. The IMF said Britain's economy was particularly vulnerable to a house price fall, because many buyers had variable rate mortgages. The Bank of England has raised its base rate five times since November 2003 to 4.75%.

To: mishedlo who wrote (12895)	10/6/2004 2:14:01 PM
From: Haim R. Branisteanu	Read Replies (2) \| Respond to of 116555

mish - as expected also it seems strange that WS lowered it's expectation to accommodate the republicans - you can trust nothing and no one those days all is political oriented since Clinton prove it works. More sadly is the article on Bloomberg degrading Gross assessment of underreporting inflation - they guy is a great spin doctor more so when he concludes that the addition of an air bag improve the quality of the car - missing the point that the government is saving hundreds of thousand of $$$ on every fatal car accident. May be he should add that more police on the street is also lowering the CPI as is improved roads, improved road signals and less drinking. …. all add up to less car accidents ... so may be with all those improvements we will have ZERO inflation due to hedonics