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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: GraceZ who wrote (31550)	5/19/2005 11:51:58 AM
From: Valuepro	Read Replies (2) \| Respond to of 306849

Grace, "Long rates are falling precisely because by raising short rates they've effectively killed off inflation expectations..." Yes, I agree about expectations. I don't think that can last under the pressure of a commodities boom. If prices for raw materials are going up, and if China and India can sustain these inflationary pressures via higher wages, then the rest of the planet will suffer price inflation and low growth. This inflationary period, however, unlike our's of the 70's, will not be accompanied by runaway real estate prices here. 1) That may be part of what is happening now, running ahead of the cycle, and 2) it will not be sustainable when all other living costs are going up against falling real incomes. We are already in such a hole in jobs growth, we may not recover for decades.