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

To: sea_biscuit who wrote (94157)	5/12/2008 2:39:38 PM
From: FreedomForAll	Read Replies (1) \| Respond to of 110194

Can John Q Public get a mortgage to buy his groceries?

To: sea_biscuit who wrote (94157)	5/12/2008 3:14:29 PM
From: jazz_lover	Read Replies (2) \| Respond to of 110194

To be fair, I come to a different interpretation of his quoted statements than you have. I think he's saying the big picture shows a net deflation. The loss of 200K far exceeds the small amount of inflation a person pays in food/gas costs. He makes a good point, imho.

To: sea_biscuit who wrote (94157)	5/12/2008 5:29:10 PM
From: Box-By-The-Riviera™	Read Replies (1) \| Respond to of 110194

its never been a good thing when he tries doing his own math. though it is unusual that he didn't try to steal anyone else's in the case.

To: sea_biscuit who wrote (94157)	5/12/2008 5:49:55 PM
From: benwood	Read Replies (2) \| Respond to of 110194

A rise in house prices did nothing for me, nor many others. A decline is a similar non-event, neither helping nor hindering my ability to purchase rice. For the 5-10% buying a new house this year, it still will do little as most will be selling a house, too, for less money than it was worth before, except they'll lose the usual 10% to the vultures (commissions, taxes, improvements, fees). The major effect of the decline in house prices (and the return of rational lending standards) has been to shut down the house-as-ATM. This is the reverse of what Mish is thinking (it seems to me) in that they will have a harder time, not easier, of affording the necessities. If we ruled the world economy, this process would be highly deflationary. Instead it will turn out to be a deflationary head wind in the face of a huge inflationary tsunami and so there will be a slight moderation in the rapid ramping of inflation for the stuff we want but don't absolutely need (tvs, cameras, autos, air travel). Those items for the most part will inflate in retail price, but not so fast as necessities. I could see a deflationary bust out there being possible in several years, but who gives a crap about a 25% drop in retail prices after a 150-200% run-up?