Pent up demand is finite. After a certain period of time that demand becomes satisfied. Any sudden increase in interest rates and that demand disappears.
On Tuesday, President Obama and the first lady used the State of the Union spotlight to pay tribute to an innocent teenage girl shot and killed by Chicago gang thugs. On Friday, Obama will travel to the Windy City to decry violence and crusade for more gun laws in the town with the strictest gun laws and bloodiest gun-related death tolls in America.</P><P>Does the White House really want to open up a national conversation about the state of Chicago? OK, let's talk.
From 1994 until 1999 there was little difference in the rate of change of rent vs. housing prices. That changed in 2000 with the dot.com crash and accelerated when Greenspan started cutting rates.
There's a natural human impulse to help people who need a hand. In the political world, that often translates to an impulse to have government help people who need a hand. Who wants to argue with that?
Well, Obama's victory means that Federal Reserve Chairman Ben Bernanke will keep his job, at least until the end of his term in 2014.
Since the beginning of the long-anticipated new round, QE 3.0, 30 year mortgage rates have fallen to 3.49%, an all-time low.
Of course the reality is simply that the media is once again hyping a non-existent recovery. The news isn't that the housing market is doing well or recovering but rather that the media is trying to spin generally bad data into good news just weeks ahead of a presidential election.
Every time I see a report about "new home construction" showing signs of improvement, I'm not excited. I'm frightened. We have an oversupply of homes and we're building more. This can't end well.
Hats off to Investor's Business Daily for telling it like it is. If there is a central figure culpable for the housing industry collapse and economic meltdown of 2008, it is Bill Clinton.
1) America's credit rating would get so low that it would force President Dennis Kucinich to petition the UN for donations to pay for Social Security, Medicare, and his newly implemented 350 weeks of unemployment plan.
I side with Kiesel on the idea that "housing beats a lot of asset classes." In relative terms it is certainly possible to envision housing declines of 10% and equity markets declining 33% or more.
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