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

To: Hawkmoon who wrote (110915)	3/17/2008 10:39:58 AM
From: MulhollandDrive	Read Replies (1) \| Respond to of 306849

Is your landlord suffering a negative cash flow on the rental payments you're making? ding ding ding now you're getting it

To: Hawkmoon who wrote (110915)	3/17/2008 11:03:13 AM
From: neolib	Read Replies (4) \| Respond to of 306849

Hawk, you need to comment on the large asymmetry in your views on how markets work. When multiple bids were placed above the asking price for homes in 2005, did you think that perhaps prices should have been frozen for 1 year so that the market could get back in balance? Your view seems to be that a bidding frenzy is an efficient market, which should not tolerate intervention, but a lack of bidders is a seized up market which demands intervention. Unfortunately, an excess of buyers and a lack of buyers are both expected states of a market. Market participants aught to be smart enough to consider both cases, or not participate if they don't like the risk, OR play only in markets regulated enough to their liking. There are many structural elements of our economic system which biases towards asset inflation, not the least of which is schooled expectation that such an outcome is both "normal" and "good". It should then come as no surprise that when the markets correct in the negative direction, that many people find this alarming. Rather than trying to figure out how to mitigate negative market moves, why not work at making market mechanisms more neutral wrt to long term market direction, which do a much better job of actually making efficient markets.