[quote=jpinpb]If we are going to go by what’s been happening, i.e., government intervention, then sure, we can expect that to continue.
HOWEVER, despite all the money the government has thrown at this, we have seen some pretty big declines since peak. Someone just posted a thread about a huge drop on a place in LJ. The harder hit areas have seen 50%+ declines. Condos have seen some major declines and nicer SFH have still seen declines on the order of 20%+ even in good areas. This is even w/all the government help.
So, I’m thinking there will be more declines and more government help.[/quote]
This is what I’m expecting as well.
Yes, the govt will pump as much as they can, but other countries and some fiscal conservatives are already giving the Fed/govt a hard time about all the stimulus. Either they run out of ammo, or other entities force their hand. I’m not as convinced as some others that the PTB can continue with this insane volume of pumping without reaching the tipping point somewhere. Either we destroy the dollar — which will make everything worse for everyone; or the bond market **at some point** will slap them down.
If they keep going the way they are, it’s entirely possible we’ll see double-digit interest rates on mortgages…maybe even Treasuries. For now, the money pumping isn’t hitting J6’s paycheck. As long as someone in China is willing to do Joe’s work for 1/2 the price, our wages will not see any significant gains. Good luck with falling/stagnant wages and declining benefits (and we haven’t even seen the municipal problems that will hit us square in the face), double-digit interest rates will just cause prices to fall, UNLESS we see only foreign money coming in to buy up all our land from under our noses. That’s totally possible, but I’m not sure I’d want to stay here to see the carnage that results.
