I find it interesting!!

[scaredyclassic]

who can say? everybody’s bet so big on inflation, maybe we’re all about to get the biggets contrarian lesson in 100 years. What if $100 in 5 years is worth 3 x what it was in 1995? I mean, can you envision a future where a job making 100k a year is incredibly rare, where people are fighting for 10 dollar an hour jobs? if so, why cannot a house be 42,000 in tememcula? Why cannot it be 175k in carlsbad? it seems impossible because we’ve all been raised to believe inflation is as inevitable as death and taxes. If there’s been some fundamental miscalculation on that — maybe low low prices aren’t dreams. It’s just (a) you probably wont be able to afford it and (b) there will be some social chaos along the way. Comparing prices to rents current is specious because the rent could be 150 a month in the future — or some similar numebr that soudns absurd based on current conditions. yeah sure, if rent stayed the same, of course it would look silly. I am not saying I would bet money on this outcome, but i wouldn’t be shocked to see a very veryvery poor america in the future. and husing values and rents that match our actual level of wealth — that is low low pricing. I am not saying it’s liekly — just that i woudl assign it a less than trivial percentage of occurring.

[sdrealtor]

It seems impossible because I meet with people everyday and hear what they have in cash savings sitting in the bank. Just met another 40 something couple today, 1st time homebuyers sitting on $200K plus in the bank. I run into a couple of these every week. I cant be meeting all them.

[sdrealtor]

It seems impossible because I meet with people everyday and hear what they have in cash savings sitting in the bank. Just met another 40 something couple today, 1st time homebuyers sitting on $200K plus in the bank. I run into a couple of these every week. I cant be meeting all them.

[sdrealtor]

It seems impossible because I meet with people everyday and hear what they have in cash savings sitting in the bank. Just met another 40 something couple today, 1st time homebuyers sitting on $200K plus in the bank. I run into a couple of these every week. I cant be meeting all them.

[sdrealtor]

It seems impossible because I meet with people everyday and hear what they have in cash savings sitting in the bank. Just met another 40 something couple today, 1st time homebuyers sitting on $200K plus in the bank. I run into a couple of these every week. I cant be meeting all them.

[sdrealtor]

It seems impossible because I meet with people everyday and hear what they have in cash savings sitting in the bank. Just met another 40 something couple today, 1st time homebuyers sitting on $200K plus in the bank. I run into a couple of these every week. I cant be meeting all them.

[socrattt]

Sdr, no doubt there is still plenty of cash on the sidelines. I for one am in that boat. I have plenty of cash to make acquisitions, but when you are on a boat and not sure which way it’s going to flip over what do you do? It’s disheartening to think that our dollar could devalue dramatically but shadycat does make a good point. We really have no clue what is going to happen to the dollar until it actually does. We were all wrong with the upward move of the dollar the second half of 08. Most economists predicted the dollar would continue its’ downward trend with the Euro.

All we do know is that if economics continued to play the proper role in the RE markets we will have enough inventory for years to come in the current market and prices should continue to drop until we get back to the property supply to keep a stable market. Unfortunately there are so many variables these days. Regardless, we will be entertained over the next few years. I can’t imagine how cool all the new textbook charts will look in 2012. Imagine being an economics professor right now, what would you tell your class?

[socrattt]

Sdr, no doubt there is still plenty of cash on the sidelines. I for one am in that boat. I have plenty of cash to make acquisitions, but when you are on a boat and not sure which way it’s going to flip over what do you do? It’s disheartening to think that our dollar could devalue dramatically but shadycat does make a good point. We really have no clue what is going to happen to the dollar until it actually does. We were all wrong with the upward move of the dollar the second half of 08. Most economists predicted the dollar would continue its’ downward trend with the Euro.

All we do know is that if economics continued to play the proper role in the RE markets we will have enough inventory for years to come in the current market and prices should continue to drop until we get back to the property supply to keep a stable market. Unfortunately there are so many variables these days. Regardless, we will be entertained over the next few years. I can’t imagine how cool all the new textbook charts will look in 2012. Imagine being an economics professor right now, what would you tell your class?

[socrattt]

Sdr, no doubt there is still plenty of cash on the sidelines. I for one am in that boat. I have plenty of cash to make acquisitions, but when you are on a boat and not sure which way it’s going to flip over what do you do? It’s disheartening to think that our dollar could devalue dramatically but shadycat does make a good point. We really have no clue what is going to happen to the dollar until it actually does. We were all wrong with the upward move of the dollar the second half of 08. Most economists predicted the dollar would continue its’ downward trend with the Euro.

All we do know is that if economics continued to play the proper role in the RE markets we will have enough inventory for years to come in the current market and prices should continue to drop until we get back to the property supply to keep a stable market. Unfortunately there are so many variables these days. Regardless, we will be entertained over the next few years. I can’t imagine how cool all the new textbook charts will look in 2012. Imagine being an economics professor right now, what would you tell your class?

[socrattt]

Sdr, no doubt there is still plenty of cash on the sidelines. I for one am in that boat. I have plenty of cash to make acquisitions, but when you are on a boat and not sure which way it’s going to flip over what do you do? It’s disheartening to think that our dollar could devalue dramatically but shadycat does make a good point. We really have no clue what is going to happen to the dollar until it actually does. We were all wrong with the upward move of the dollar the second half of 08. Most economists predicted the dollar would continue its’ downward trend with the Euro.

All we do know is that if economics continued to play the proper role in the RE markets we will have enough inventory for years to come in the current market and prices should continue to drop until we get back to the property supply to keep a stable market. Unfortunately there are so many variables these days. Regardless, we will be entertained over the next few years. I can’t imagine how cool all the new textbook charts will look in 2012. Imagine being an economics professor right now, what would you tell your class?

[socrattt]

Sdr, no doubt there is still plenty of cash on the sidelines. I for one am in that boat. I have plenty of cash to make acquisitions, but when you are on a boat and not sure which way it’s going to flip over what do you do? It’s disheartening to think that our dollar could devalue dramatically but shadycat does make a good point. We really have no clue what is going to happen to the dollar until it actually does. We were all wrong with the upward move of the dollar the second half of 08. Most economists predicted the dollar would continue its’ downward trend with the Euro.

All we do know is that if economics continued to play the proper role in the RE markets we will have enough inventory for years to come in the current market and prices should continue to drop until we get back to the property supply to keep a stable market. Unfortunately there are so many variables these days. Regardless, we will be entertained over the next few years. I can’t imagine how cool all the new textbook charts will look in 2012. Imagine being an economics professor right now, what would you tell your class?

[temeculaguy]

socratt, it’s a just a bet, you look at the odds and you place one. These boards are filled with excellent advice about placing your housing bet in such a way that can increase your odds of winning. But make no mistake, not this year, next year, or a hundred years from now will the risk be eliminated. My theory was just a way to compare towns to their own historical numbers and to give a framework of when you have minimized the risk enough to feel comfortable placing a bet. Buying a house for the value of the materials is one way of minimizing risk, buying one that does not need to appreciate because it is rent neutral is another. But if it gets rent neutral, don’t get worried than rents will go down by some huge percentage, that’s just not a historically significant scenario, thus a risky bet.

Let’s handicap scardeycat’s notion of hyper deflation, of rents at 1/10th of today and of the dollar buying you more as we move forward. All of it can happen but here’s why I say it’s a longshot akin to winning the lottery.

Our currency and the currency of many countries is not backed. No country has had prolonged hyperdeflation. When a society or a currency collapses, there is usually hyperinflation as more money is added to the supply by the printing press (like right now). When times are good, there is inflation, when times are bad there is inflation or stagflation. But when things go to hell, hyperinflation is far more likely than in any other time. Deflation is usually short lived and follows or is followed by inflation. But in the long run, over the decades, there is inflation. Now I’m basing this on a few hundred years of a few hundred cultures, there may be one or two instances of hyperdeflation but I’ve never read about them. I’m not talking a few percent deflation but deflation on the order of 2x to 10x. Deflation that would become an actual factor. Do not confuse this with a particular bubble deflating.

This is not to say it can’t happen, it’s just that there are many more countries than just our own, most with longer histories and if it has never happened before, it’s not a safe bet. I like dinosaurs, I wish they would make a comeback and roam the land again, it could happen but I’m not betting my money on it.

[temeculaguy]

socratt, it’s a just a bet, you look at the odds and you place one. These boards are filled with excellent advice about placing your housing bet in such a way that can increase your odds of winning. But make no mistake, not this year, next year, or a hundred years from now will the risk be eliminated. My theory was just a way to compare towns to their own historical numbers and to give a framework of when you have minimized the risk enough to feel comfortable placing a bet. Buying a house for the value of the materials is one way of minimizing risk, buying one that does not need to appreciate because it is rent neutral is another. But if it gets rent neutral, don’t get worried than rents will go down by some huge percentage, that’s just not a historically significant scenario, thus a risky bet.

Let’s handicap scardeycat’s notion of hyper deflation, of rents at 1/10th of today and of the dollar buying you more as we move forward. All of it can happen but here’s why I say it’s a longshot akin to winning the lottery.

Our currency and the currency of many countries is not backed. No country has had prolonged hyperdeflation. When a society or a currency collapses, there is usually hyperinflation as more money is added to the supply by the printing press (like right now). When times are good, there is inflation, when times are bad there is inflation or stagflation. But when things go to hell, hyperinflation is far more likely than in any other time. Deflation is usually short lived and follows or is followed by inflation. But in the long run, over the decades, there is inflation. Now I’m basing this on a few hundred years of a few hundred cultures, there may be one or two instances of hyperdeflation but I’ve never read about them. I’m not talking a few percent deflation but deflation on the order of 2x to 10x. Deflation that would become an actual factor. Do not confuse this with a particular bubble deflating.

This is not to say it can’t happen, it’s just that there are many more countries than just our own, most with longer histories and if it has never happened before, it’s not a safe bet. I like dinosaurs, I wish they would make a comeback and roam the land again, it could happen but I’m not betting my money on it.

[temeculaguy]

socratt, it’s a just a bet, you look at the odds and you place one. These boards are filled with excellent advice about placing your housing bet in such a way that can increase your odds of winning. But make no mistake, not this year, next year, or a hundred years from now will the risk be eliminated. My theory was just a way to compare towns to their own historical numbers and to give a framework of when you have minimized the risk enough to feel comfortable placing a bet. Buying a house for the value of the materials is one way of minimizing risk, buying one that does not need to appreciate because it is rent neutral is another. But if it gets rent neutral, don’t get worried than rents will go down by some huge percentage, that’s just not a historically significant scenario, thus a risky bet.

Let’s handicap scardeycat’s notion of hyper deflation, of rents at 1/10th of today and of the dollar buying you more as we move forward. All of it can happen but here’s why I say it’s a longshot akin to winning the lottery.

Our currency and the currency of many countries is not backed. No country has had prolonged hyperdeflation. When a society or a currency collapses, there is usually hyperinflation as more money is added to the supply by the printing press (like right now). When times are good, there is inflation, when times are bad there is inflation or stagflation. But when things go to hell, hyperinflation is far more likely than in any other time. Deflation is usually short lived and follows or is followed by inflation. But in the long run, over the decades, there is inflation. Now I’m basing this on a few hundred years of a few hundred cultures, there may be one or two instances of hyperdeflation but I’ve never read about them. I’m not talking a few percent deflation but deflation on the order of 2x to 10x. Deflation that would become an actual factor. Do not confuse this with a particular bubble deflating.

This is not to say it can’t happen, it’s just that there are many more countries than just our own, most with longer histories and if it has never happened before, it’s not a safe bet. I like dinosaurs, I wish they would make a comeback and roam the land again, it could happen but I’m not betting my money on it.

[temeculaguy]

socratt, it’s a just a bet, you look at the odds and you place one. These boards are filled with excellent advice about placing your housing bet in such a way that can increase your odds of winning. But make no mistake, not this year, next year, or a hundred years from now will the risk be eliminated. My theory was just a way to compare towns to their own historical numbers and to give a framework of when you have minimized the risk enough to feel comfortable placing a bet. Buying a house for the value of the materials is one way of minimizing risk, buying one that does not need to appreciate because it is rent neutral is another. But if it gets rent neutral, don’t get worried than rents will go down by some huge percentage, that’s just not a historically significant scenario, thus a risky bet.

Let’s handicap scardeycat’s notion of hyper deflation, of rents at 1/10th of today and of the dollar buying you more as we move forward. All of it can happen but here’s why I say it’s a longshot akin to winning the lottery.

Our currency and the currency of many countries is not backed. No country has had prolonged hyperdeflation. When a society or a currency collapses, there is usually hyperinflation as more money is added to the supply by the printing press (like right now). When times are good, there is inflation, when times are bad there is inflation or stagflation. But when things go to hell, hyperinflation is far more likely than in any other time. Deflation is usually short lived and follows or is followed by inflation. But in the long run, over the decades, there is inflation. Now I’m basing this on a few hundred years of a few hundred cultures, there may be one or two instances of hyperdeflation but I’ve never read about them. I’m not talking a few percent deflation but deflation on the order of 2x to 10x. Deflation that would become an actual factor. Do not confuse this with a particular bubble deflating.

This is not to say it can’t happen, it’s just that there are many more countries than just our own, most with longer histories and if it has never happened before, it’s not a safe bet. I like dinosaurs, I wish they would make a comeback and roam the land again, it could happen but I’m not betting my money on it.

[Author]

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