[quote=schizo2buyORnot] Read . . . if you have all your money in cash and are sitting in cash because the sky is continuing to fall you are in one of the worst most risky investments you can be in. Thats right . . . those that have their money in a bank so it is “safe” are going to get screwed. Buy RE, buy oil stocks, buy mining stocks, buy Chinese stocks, but gold, I don’t care. Don’t stay liquid in US dollars however. My original post stands . . . SD RE in US Dollars will cost more US Dollars in Aug. 09 . . . largely because the US dollar is going to hell in a hurry.[/quote]
I really want to believe this. I really do! But the recession fear is indelibly embedded in the US psyche. It took a long time to get there, and I suspect will take as long to build confidence back into the system. This is as much about a crisis of confidence as applied economics. Moreover, there are a lot of delayed reactions that need to filter through the system, before a recovery becomes evident. You can’t dismiss the argument that squirting the same old lighter fluid onto the flames won’t get a lot of heads shaking. Trying to predict the actual month a turn around will occur is a little whimsidaisical. I agree, being in cash is a concern, but I’d personally still prefer to be in it, and the negligible risk it entails, while still renting than in an over-inflated asset, that carries with it so many additional costs. If the US, and California especially cannot fix this problem of fundamentals in pricing, which has a knock on effect in costs overall, than it will be time to move on. You can’t just focus on housing all the time. Health care, social security, global warming, growing global populations, scarcity of resources, and energy are all part of what is to come. So even if housing eventually bounces back, the winners will only be those who have been watching the horizon. Be sensible, patient, and not greedy. The latter in particular will become an anachronism, but dint of necessity.
