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

To: zebra4o1 who wrote (106934)	1/11/2010 3:56:47 PM
From: GST	Read Replies (1) \| Respond to of 110194

Real estate won't protect you because it is an asset class that does not have enough access to credit and very limited appeal as a speculative investment. Even to sustain current levels will be difficult once massive subsidies for housing have run their course. Inflation at this point is a global phenomenon rather than a US centric one. Where you will see the most rampant inflation is in things that are traded on international markets -- commodities and gold being prime. Your house is now a lingering liability. Your best bet is to think global when trying to protect yourself against dollar inflation -- i.e. get your money out of anything tied to the US in general, and out of the dollar in particular.

To: zebra4o1 who wrote (106934)	1/11/2010 5:14:28 PM
From: Skeeter Bug	Respond to of 110194

zebra, i disagree with GST. first that hyper inflation is a foregone conclusion. it depends on what the banks do going forward and they will do whatever serves their interests. they will print money to cover their losses, but once covered they may well stop printing money and take down the economy to buy assets for pennies on the dollar. in that environment, housing will punish you. i own a home and, quite frankly, i expect to be punished. i bought right, though, so i still have a 40% cushion before i go negative, but i may well go negative before this is over. if inflation does hit, though, real estate won't do well, BUT THE LOW INTEREST FIXED RATE DEBT WILL DO EXCEPTIONALLY WELL! daniel ammerman (maybe amerman) has free email course explaining why. i recommend it. in short, the inflation eats into the debt tax freaking free. if you have $200k in debt, your debt is worth $180k after one year of 10% inflation. that's a $20k real gain TAX FREAKING FREE! try doing that with gold and its 35% tax rate (45% in Collapsifornia). i was 7 years from paying off my home completely and did a cash out refi at 4.75% as a hedge against inflation for my primary residence. i had a condo paid off in full that i sold to avoid the expected further depreciation r*pe. it just depends on your situation and location. in short, the risk has never been higher and reward has never been worse... anyway, see this post for actual deflationary data... Message 26237076