Post by The Great Aztec Joe on Aug 31, 2010 4:55:17 GMT -8
This housing crisis that has been the spark for the economic collapse (but not necessarily the main reason) has continued for years now. Houses both new and old are simply not selling at the prices offered.
It would appear that the confident buyers out there simply do not exist in large numbers. Until houses start selling, the building industry workers (carpenters plumbers, masons, electricians, painters,.....) will continue to suffer 75% unemployment or underemployment.
Quite frankly the way to get houses to start selling again is to have inflation. With inflation people see the rising price of real estate as a reality and are thus swayed to buy a house or two as an investment.
The present ZERO interest policy to try to get industry rolling again is not working and is in fact pushing the US towards deflation and further loss of value for homes.
If we are to start climbing out of this stagnant economic malaise, we need some inflation now. Like all things the government does, they will probably do it to excess for a year or longer, and we will see 25% inflation when we only need to see ten percent.
For all of you people who have been renting out of fear that you can not buy in a falling market, find a house where you can sign a rent contract that allows you to buy at a STATED PRICE within the length of the rent contract. As soon as you see the FED raising interest rates, activate that clause and put your money down and watch the house double in value in three years with over 30% inflation. It will come, count on it.
The question is, "WHEN WILL THE GOVERNMENT REALIZE THAT THE PRESENT POLICIES ARE NOT HELPING THE ECONOMY TO RECOVER?"
It would appear that the confident buyers out there simply do not exist in large numbers. Until houses start selling, the building industry workers (carpenters plumbers, masons, electricians, painters,.....) will continue to suffer 75% unemployment or underemployment.
Quite frankly the way to get houses to start selling again is to have inflation. With inflation people see the rising price of real estate as a reality and are thus swayed to buy a house or two as an investment.
The present ZERO interest policy to try to get industry rolling again is not working and is in fact pushing the US towards deflation and further loss of value for homes.
If we are to start climbing out of this stagnant economic malaise, we need some inflation now. Like all things the government does, they will probably do it to excess for a year or longer, and we will see 25% inflation when we only need to see ten percent.
For all of you people who have been renting out of fear that you can not buy in a falling market, find a house where you can sign a rent contract that allows you to buy at a STATED PRICE within the length of the rent contract. As soon as you see the FED raising interest rates, activate that clause and put your money down and watch the house double in value in three years with over 30% inflation. It will come, count on it.
The question is, "WHEN WILL THE GOVERNMENT REALIZE THAT THE PRESENT POLICIES ARE NOT HELPING THE ECONOMY TO RECOVER?"