That was my initial reaction as well. But it’s more about supply/demand for the actual interest rate or cost of the money. As now the market has lower rates, but down payments have become important again as has strict documentation. Risk will be better mitigated through lower LTV’s and better documentation. I think we’re seeing this now and will see it more inthe future. I would not be surprised to see real CPI going negative in 2009. Check out ECRI’s website for more on this. So, in essence the old 6% is the new 4%. Economics takes on a different set of rules when inflation is now longer running the game.
