Posted on 12/30/2010 1:16:40 PM PST by GlockThe Vote
Peter Schiff: Here's Why Home Prices Have To Decline At Least 20% And Probably More Gregory White | Dec. 30, 2010, 12:09 PM | 6,520 | 25
House prices have to decline at least another 20.3% to come back to the historical trend and may have much further to fall, according to Peter Schiff of Euro Pacific Capital.
Writing in the Wall Street Journal, Schiff breaks down the horrible state of the U.S. residential real estate market just days after a negative Case-Shiller number pretty much confirmed we're in a housing double-dip.
Schiff explains that, if we all believe that we were in a housing bubble, then house prices need to come back to the historical trend line before we're actually through this.
But that 20.3% is only the beginning of the break.
From Peter Schiff (in the WSJ, emphasis ours):
With a bleak economic prospect stretching far out into the future, I feel that a 10% dip below the 100-year trend line is a reasonable expectation within the next five years, particularly if mortgage rates rise to more typical levels of 6%. That would put the index at 114.02, or prices 28.3% below where we are now. Even a 5% dip would put us at 120.36, or 24.32% below current prices. If rates stay low, price dips may be less severe, but inflation will be higher.
Read more: http://www.businessinsider.com/peter-schiff-home-prices-2010-12#ixzz19dBDDWwY
(Excerpt) Read more at businessinsider.com ...
His analysis is too simple. It would be more appropriate to see regional numbers. Plus, houses now are not the same as houses 100 years ago or even twenty years ago.
Head in the sand.
Show me a video remotely as accurate as this as Peter has been:
http://www.youtube.com/watch?v=tZaHNeNgrcI
NOTICE THE MORONS ON FOX NEWS LAUGHING AT HIM!
Housing will be down in some regions, flat or going up in others.
The Rocky Mtn states, for instance, continue to have a growing population that puts an upward demand on housing units.
Until someone can show me another person even 50% as accurate as Schiff will take his advice over the hacks attacking him.
I disagree. Demographics, inflation, taxes, carrying costs, young people saddled wth debt, etc is going to keep houisng in the toilet for decades.
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Ditto that.
He has been amazingly accurate...but there will be some here who think they know better.
Prices are going to going down across the board. As they are forced to raise interest rates and local taxes skyrocket, the value of the home will go lower and lower and be seen as more an albatross than anything else.
And who do we have to thank for this? Fed Reserve and the Fed/State/city govt.
That video is why i refuse to watch Fox News by and large. Its mostly nonsense when you can get the truth easily by people like Schiff/Celente/Chapman etc via youtube vids, podcasts, newsletters etc.
Schiff/Celente called gold and silver to the tee as well.
Its not fun hearing such pessimistic views, but the reality is what it is.
Those are my views and not Schiff's.
As noted in the response, I base them on actual events reported by economic historians, rather that forecasts prepared by academicians and government bureaucrats.
If you want to think about something really terrifying, try to amortize our national debt. All of the premises you need can be found here: U.S. Debt Clock.
OK, so it can't happen under current conditions. But maybe we can still avert disaster if we slash government spending enough. Start by eliminating the 40 percent or so we borrow. Then raise interest rates to a more reasonable level from those resulting from printed money (with another $140 billion or so in spending cuts required for every percentage point they're hiked). Try not to think of Greece in the process. Think you can cut another trillion or two or three from spending to make ends meet?
So how about doing away with Medicare, Medicaid, Social Security, Food Stamps and Civil Servant Pensions. Is that enough, even if it were remotely politically possible?
Rerun the numbers as many times as you like and you will discover that default is inevitable. What does that mean?
For an answer, go back to the economic history text books and look at what happens to countries that default on their obligations.
Hint: think South American type hyperinflation if we default on the external debt only (i.e. debt held by foreigners), and Zimbabwe type hyperinflation if we also default on internal debt.
As noted earlier and elsewhere, as a nation, we are so incredibly screwed!
“I agree with Schiff 10000000%”
Ditto. Its not going to get better for a long time.
Check this out
Peter Schiff v. Ben Bernake
Who do you trust?
http://www.youtube.com/watch?v=V5sDKwMP6Pc
Schiff’s books and videos on youtube are well worth watching and keeping up with.
LOL...boy did I misconstrue your post!
Believe me, I see what’s comming, not if but when is the part to figure out.
I personally believe they chose to have a long drawn out collapse vs a shock an awe collapse.
Gives them more time to prepare and longer for us slaves to get used to living under miserable conditions.
The speed to which it happens may be proportional to the ones thoughts on his reelection odds in 2012?
Just thinking out loud.
You are exactly correct.
Problem is that the U.S. economy is so huge, the dollar is still a reserve currency (which many will try to prop up at all cost), the public is so ill informed, and "loss of confidence" in our fiat currency is so subjective.
John Williams (Shadow Government Statistics) is predicting a hard landing any time within an 18 month window beginning mid-2011. Others forecast any time from now to five years from now.
And of course, Helicopter Ben is 100 percent sure he can contain inflation at the Fed.
Believe whomever you want.
It won’t matter. By 2012, the damage will be so bad, so deep, that no matter who is in there, it wont matter all that much.
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