Saturday, April 24, 2010

The Next American Real Estate Bubble... upon us. Let's review--low interest rates + low money down + $8K tax credit = bubble. As long as we continue to subsidize bad personal investing behavior (the mortgage interest deduction which drives poor investment balance and diversification) we will find ourselves fighting this ridiculous boom/bust real estate cycle.


Tom de Plume said...

"Economists disagree on whether the sales momentum can be sustained, especially after the tax credit expires."

Well of course it can. There are now 411,000 families who's friends and relatives will be forced to now upgrade their own cribs in order to "keep up with the Joneses".

Not to mention of course that there are now an additional few hundred thousand families who have overbought and will expect the gubmint to pay for their healthcare, educations, and retirements.

Goldwater's Ghost said...

Yep. This "recovery" is akin to the eye of the hurricane. Hey, the worst is over! See? It's sunny outside.

"The Hammer" said...

Fanny and Freddie are still loaning money hand over fist. Obamanomics is the gift that keeps on giving.

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