Is housing exempt from what we consider “inflation”?

Because once housing went up, say, 30%, one would have expected the Fed to slam the brakes on the problem by kicking the interest rates up a point or so.

Now housing is up 300, maybe 400%– maybe higher– and “overvalued” doesn’t even begin to describe the market. Massive numbers of apartments have been converted to condominiums. And tax revenue expectations, as I mentioned in a previous article, are far higher that the realized taxes are going to be, depending on how many houses were purchased by investors and how many of those investors end up declaring bankruptcy. Quite a few communities, jumping at the perceived opportunity for solvency by encouraging (or at least failing to stop) unbridled new construction, may end up owning more property than they care to.

I myself used to think that lower rates from the Fed were unilaterally a good thing. Now I see why that’s not entirely true.

I can’t help but feel that all this combines into a serious economic problem, especially as rising fuel costs dip further into people’s budgets.

Whatever the result is, hopefully we will have learned a lesson clearly enough to articulate.

Chances are, though, that we won’t be able to articulate it more clearly than the first line of I Timothy 6:10.

:)