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

To: ild who wrote (74287)	11/19/2006 10:13:17 PM
From: forceOfHabit	Respond to of 110194

ild, IMO the market took builders' problems as a RE bubble popping. But then the market decided that builder's problems were not a big deal as long as the RE prices were holding well. I like that answer because it contains both a reason for the bearish sentiment and a reason for its disappearance, and I think I'll add it as a factor alongside my opinion on the impact of oil prices. I don't think its sufficient on its own, because I don't think the perception of a bubble popping or the impression that the RE market had stabilised was widely enough or strongly enough held to have that kind of impact. My impression is that people who don't follow RE closely never worried about the bubble popping, and people who do are not convinced the situation has bottomed. (Maybe I'm too heavily influenced by the gloom and doom on this board.) In contrast, I think the oil fever was both widespread and strongly believed. foh