Bub, thanks for the lead. Excellent series of interviews. Great to hear Campbell and Shiller’s voices and thoughts.
Some highlights:
Neat analog to San Diego: Vancouver had a real estate boom in the early ’80s, with a strong economy benefitting from hot markets in oil and other minerals. Then, prices fell to 1/3 of their values from peak (per Shiller, the sharpest fall that he knows of). Folks said the collapse couldn’t happen, as there was no room to expand in Vancouver (bound by U.S., mountains, and Pacific). Shiller thinks that the sharp fall in prices may have been due to the widespread use of ARMs, which reset high as the U.S. was fighting inflation with high interest rates in the early ’80s.
Campbell recommends parking funds in cash. He says that inflation has never been a problem once the U.S. is in recession. And, Campbell thinks that the best real estate buying opportunities will present themselves in 3-6 years.
