real estate bubble?
 

interesting read...

well, partly true.

the folks that are vulnerable are those holding very short term ARMs.

right now interest rates are going up a quarter point/month---IMO this will go to half point/month first quarter 2006.

but there is a minor mitigating factor which will "soften" the landing to the RE bubble "burst".

inflation in the USA is going to come back big time. the bush war overseas, and major deficit spending will force the US govt to print money like crazy---so folks hold long term low interest rate fixed mortgages will be somewhat protected because they will be paying back loans with inflated dollars.

the trick will be to hang on to their overpriced properties---because if they can just hang on for 36 months inflation will bail them out.

look for 12%/year inflation in 2007.

there's still a lot of slack capacity from the late 90's bubble. energy prices will soften now(or won't rocket like it has been) that the fed rate is above inflation as it should be.

i don't see high inflation coming in 07. maybe upwards of 5% but there's just not enough steam in the economy to shoot prices up given international pricing pressures. companies just can't raise prices that much because consumers won't be able to handle it.

real estate peaked this summer stock wise, its downhill from here in most markets

It is bound to pop here very shortly.

its fun watching people fail