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

To: MulhollandDrive who wrote (266699)	8/5/2010 6:39:39 PM
From: ChanceIs	Respond to of 306849

>>>wouldn't such a gambit actually accelerate the drop in RE prices<<< The mechanics and consequences of the FED's "drive-by-refi" are from from clear to me. I have had Denninger's critique on that open but unread all day. (Why am I posting here when I have more important things to do?) Some make the argument that the bond market will freak as people fear the refi wave, and hence the need to relend the money at much lower rates, and as such would toss their bonds and drive up rates right away. In the long run, I am betting on a rise in rates which will begin the third (given we are just starting the second) down leg in real estate. In the short term I am in the deflation camp. One has to try to predict whether homeowners react to their home's worth/debt ratio, or whether their monthly nut covers their warm dry roof. And also how the neighbor is doing with his strategic default, live 24 months for free project.