Net this out. Where are you putting your money as a result of that analysis? The smart money has left real estate, this we know. The question is, where has it gone. Obviously, blue chip stocks. The Dow has way outperformed the SP500 in the last few months, so that is one place. Interest rates are going to put an end to that any day now with their negative divergence against stock prices.
My question is, with all of that comparative analysis, what does that tell us about the next asset class that will be inflated to save the day from the housing collapse?
I do not have an answer, I am trying to figure it out now. Commodities is a sucker play the herd is chasing now. The music will stop there. Hedge funds seemed a likely bet, but there is starting to be some fall out there. Also, many of them are leveraged in RE, so they will go away.
The Itulip site is debating this very issue right now.
