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

To: John Vosilla who wrote (23532)	2/14/2005 1:36:47 PM
From: ild	Respond to of 116555

Myths about downsizing From Times wire services It is often assumed that the typical aging homeowner is looking to move to an active adult community and downsize, but the results of a recent ERA Real Estate survey of 1,500 people 50 and older revealed changing attitudes about real estate. • Only 8% of those considering a move in the next five years indicated that they might consider an active adult community. • More than 61% would consider purchasing a single-family home. • The average senior lives in a house with three or more bedrooms and two or more baths. • Only 11% felt their current home was too big. • 25% of respondents thought their homes were too small. latimes.com

To: John Vosilla who wrote (23532)	2/14/2005 1:41:33 PM
From: mishedlo	Respond to of 116555

Guess it comes down to will new innovation and capital investment to create new businesses, new markets and new worldwide demand be enough to offset the slowdown by the overextended US consumer. I have a hard time believeing that is possible. Is Japan or Europe about to go on a buying spree? Growth if any will have to come from Brazil and China. Can that offset falling demand from the US, UK, and the EU? Even assume it is only the US pulling back, can you offset that demand. I believe there is overcapacity already. That is the only way we can see falling prices at Walmart and falling prices aand enormous rebates etc on cars in the face of rising steel and oil prices. Note too that the US does not even have to fall off the cliff here. Assume for a second that US housing starts drop 20-30% this year. That sounds huge but it would still be one of the top 3-4 years ever if I am not mistaken. But what would that do to the chain of jobs here? The problem is the world is awash in $ but there is hardly anyplace to put them that makes any sense whtsoever. We do not need more capacity on goods, we do not need more cars, at 70% homeowbnership in the US I doubt we need more homes, where do these US$ go? The answer is easy. In a credit crunch this money just gets destroyed. The mal-investments must get corrected. Mish