Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: russwinter who wrote (37380)	7/31/2005 5:39:06 PM
From: NOW	Respond to of 110194

good post.

To: russwinter who wrote (37380)	7/31/2005 8:07:14 PM
From: el_gaviero	Respond to of 110194

Very good post.

To: russwinter who wrote (37380)	8/2/2005 3:53:02 AM
From: John Vosilla	Read Replies (1) \| Respond to of 110194

"Beg to differ again, 98% see Bubbles they can borrow and speculate on, all the while just poo-pooing the resulting serious inflation as "no big deal"..........Then you end up with a ludicrious situation where so much capital has been misallocated, that you have 1-2% cap rates on rentals, that's if they are lucky enough to find a renter." 98% see double digit annual appreciation with 1% pay rates as a given making 1-2% cap rates irrelevant<g> I think the deflation crowd fails to realize the most likely course to save creditors is a slow persistent rise in rates coupled with higher cap rates/lower multiples to cash flow adjusting properties back to realistic values over time. This spreads out credit risk over a longer tim horizon and keeps losses from devaluing currencies to a minimum. A deflation scenario with even lower rates would compound the problem as values will rise even further the next few years in a still growing US economy given the desire to grow our way out at any cost via population growth and development of vacant land, two important ingredients lacking in Japan.