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RE: Baby BOOMERS..!! Is the World on the Verge of Global HYPERINFLATION..??
Hyperinflation would be great! It would make all house owners rich, eliminate debt and catapult crypto.
Hyperinflation would be great! It would make all house owners rich, eliminate debt and catapult crypto.
Who are all these rich home owners going to sell these over priced homes to ?
Not to mention how are they going to pay the property taxes when they are almost as much as the house note ?
They don't even have to sell them, but their mortgages will be eliminated.
And taxes won't adjust until the house is re-sold. Property taxe sis also an American thing.
The thing that people mis understand is the thought that everything about inflation is bad, but there are also good sides to the story. Anyone with debt profits and anyone with cash hurts. Since few people have cash and everyone has debt, it's a good thing for most these days.
You can easily exploit this situation by take on debt, buy assets such as houses or crypto ir stocks and the eliminate the debt by waiting for inflation to kick in.
What we are witnessing and has worsened since the mid 1980's is the detach from wages to house prices and house prices to daily essentials. Since 2008 house prices have soared purely based on debt availability but wages have not kept pace, nor has the cost of basic essentials. If you look at the cost of the pure labour content to build a house compared to the cost of the house when built you will see the problem. There are huge distortions across the whole market and these have been exaggerated by the use use of Derivatives. Take Silver alone over the last 100 years. On average the average house price could be bought for 500 ounces of silver and in the early 1900's a daily wage was 1 ounce of silver. Extract this to todays silver price of $17oz that would leave an average house $8,500 and a daily wage of $17..!! There lies the problem. Thanks for the comment. Stephen
Yes this is true. People truly misunderstand how the housing market is overpriced due to cheap debt.
I need to buy a house soon and I am worried, but then not having the asset of a house is also a great risk in this money tray system.
You are right. House prices are way over-valued purely because of cheap credit. Could you imagine if interest rates were 7, 8, 9 % +++..!! As a rule of thumb a first time buyer should be looking at buying a house at approx x3 salary. That is $50k salary, house price $150k. Anymore and the odds are against you. Thanks for the comment. Stephen
The banks will not loose, they will call the note as the agreement specifies they can... read it carefully, hopefully yours is different. Even those that always paid on time may be at risk... because again, banks do not loose (and this did occur in the 1930's as a matter of historical import.
The banks can't lose in an inflationary system. Why would they lose?