When Housing Is Priced in Gold
Submitted by bad_karma on Thu, 09/24/2009 - 23:01
When Housing Is Priced in Gold (September 23, 2009)
Pricing U.S. homes in gold reveals that housing has fallen by two-thirds from its 2005 peak.
Frequent contributor Harun I. suggested an interesting relative-value experiment: how has housing performed in the past 20 years when priced in gold? Oftwominds.com readers know that relative performance/purchasing power has long been a theme of Harun's and of this site.
Considering all metrics of value in terms of purchasing power reveals much more insightful measures of value than nominal prices.
http://www.oftwominds.com/blogsept09/housing-gold09-09.html?...
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Its called deflation
CS-CPI Year over year has now fallen for 8 consecutive months and 11 of the past 15. High Year over year comparison data points for the next several months will likely result in CPI deflation coming in at -7% to -8% in the coming months.
http://globaleconomicanalysis.blogspot.com/2009/09/daniel-am...
* Total domestic debt — the amounts owed by individuals, governments and businesses — climbed just 3.7 percent from the second quarter of 2008 through the second quarter of this year. That is the smallest increase since the Fed started these calculations in the early 1950s.
* Over the 12-month period, nonfinancial businesses increased their debt by just 1.3 percent. Since that number is well below the interest rate most of those companies pay, it indicates that they paid back more in old loans than they took out in new ones.
* Over the year, total household debt fell by 1.7 percent, and mortgage debt — the largest component of household debt — fell a bit more, at a 1.8 percent pace. This is the 10th recession since the Fed began collecting the numbers, but the first in which the amount of home mortgage debt fell.
http://globaleconomicanalysis.blogspot.com/
One reasonable indicator of deflation is what the Fed and Central Banks are doing to fight it. The reason the Fed is fighting deflation with an alphabet soup of lending facilities and other programs is simple: The US is in deflation.
At some point the Fed will, just as Japan did, reduce the money supply. If and when that happens it will mark the Fed's belief that deflation is no longer a threat.
Ironically, those who consider inflation as a strict expansion/contraction of money kind of thing might conclude the US is going into deflation just as it is coming out of deflation.
Those focused on the CPI failed to see any chance of the Fed Fund's Rate at 2.00 again. On the other hand, those focused on the destruction of credit from an Austrian economic perspective got this correct.
Compare the price of gold in the 1980s to Microsoft shares,
and gold should be about $700,000.00 an ounce now.
Compare housing prices for the same time frame to GM shares, and a 7 bedroom villa should now cost about $50,000.00.
Compare whatever you will, and it's all ...
coulda, woulda, shoulda!
... and the beat goes on.
duhhhhhhhhh A prudent man
duhhhhhhhhh
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
A prudent man foresees the difficulties ahead and prepares for them; the simpleton goes blindly on and suffers the consequences. Proverbs 22:3
Matthew 10:34 Think not that I am come to
send peace on earth: I came not to send peace,
but a sword.
seen this?
anyone ever been to this site?
http://pricedingold.com/us-dollar/
its got charts on quite a few things....
"The Myth of an Independent Federal Reserve"
"The War Prayer - Mark Twain"
$1mm in $20oz 1929 GOLD today $50mm in $1000oz
The Liberty a society retains is inversely proportional to the number of Lawyers in the Government.
The Liberty a society retains is inversely proportional to the number of Lawyers in the Government.