Absolutely. What's interesting is that the foreign "hurt" may require those central banks to inflate the money supplies there to create liquidity, thus devaluing the currency, and leading to a slight rise of the American dollar on the Forex markets. But the fascinating thing is, at one point, interest rates are gunna have to go up domestically (sooner or later), and when they do, the housing bust will come up again, because the reality is that many of these people who bought homes, cannot afford them, and higher interest rates will stifle the housing market, putting people back into negative equity hell. The only thing the rate hold does, is put a band aid on a gunshot wound.
Home prices are inflated having jumped more than 250 percent in the past 10 years . After the Presidential election all hell will break loose. There is no way the Fed is not going to protect their ass in an election year. Robert Shiller's warning that home prices appear overvalued and that the correction could last years with trillions of dollars of home value being lost.[25] Greenspan warned of "large double digit declines" in home values "larger than most people expect." http://en.wikipedia.org/wiki/United_States_housing_bubble
3.2% is considered full employment considering structural unemployment etc. But this is where you live, how about the entire country in general? Decrease in housing prices may cause banks to ask for top ups and that in turn may lead to defaults, it can be a vicious cycle. Hopefully this can be prevented.
National unemployment is at 4.8%. The sub-prime mortgage bailout is already in full swing. Again, where I live, home values haven't decreased. Gloom and doom from the media sells. It doesn't mean the picture is accurate for most people. I would have thought that webmasters and website owners would be doing very well. It's surprising to see how many of them are downbeat and negative.
This kind of stuff does not help the majority of people. Those of us who are well off are the minority, but for the majority of people in this country things are rough. Here's todays news on the subject: Consumer inflation accelerates in November
Unemployment figures are nonsense. Wholesale Prices up! http://www.lewrockwell.com/blog/lewrw/archives/017691.html
This seems to be our catchall economics thread. Jim Cramer (Mad Money) with Ron Paul tonight. http://www.youtube.com/watch?v=peVw-g0nRgk Maybe they are both nuts. Maybe not.
Awesome! Awesome! Awesome!!! The word is spreading. People are listening, people are talking. Ron Paul is starting to get the credit and the exposure he deserves.
More importantly, people are starting to question dogma, such as The Federal Reserve protects the economy. Sound (hard) money is antiquated. Government can solve all of our problems. Decades of uninterrupted inflation is a natural economic condition.
The chances of a recession starting in an election year are zero. That's what the printing presses of the Fed are for. The Clinton recession did not start until 2001 after Bush took office and the stock bubble imploded.
Bogart, one could argue, and I am sure you might be willing to entertain this idea, that we are already in a recession. The real question is, do we want it to devolve into a depression?
No. No recession yet. Even the housing decline is minor. Most people have 100% gains and are bitching and moaning that the house they bought for $175,000 is only worth $450k rather than 500k 1981 was a real recession. 1991 and 2001 were nothing. 10%+ unemployment is where you see the real pain.
One of the great private investors, Jim Rogers on the housing crisis and government monetary policy. http://www.youtube.com/watch?v=G_HCZeSAmqs -------
Jim Rogers is also saying that India and China are driving commodity prices. The Fed is not in the drivers seat. In the end you need to have a recession to clean out the mess. The government is throwing good money after bad trying to bail out banks and investors. The real issue is that a home is not worth anymore than the rent it can earn.
Just watched ron paul on the jim cramer show. This is amazing to actually see someone from cnbc get the courage from ron paul to actually critique the fed. He sure is changing things in america and i believe for the better.