"The New Road to Serfdom - An Illustrated Guide to the Coming Real Estate Collapse"
They don't do an online version - anyone read the magazine yet? Please report here.
This is getting a bit exciting wouldn't you say - with the Fortune and now Harpers exposes back to back?
Wake up Mainstream Media! The bell is tolling! Ding dong the housing bubble is dead!
May 06, 2006
Harpers puts the bursting housing bubble on the cover
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22 comments:
This guy looks like he has an interest only scam loan, sold by an idiot real estate agent who scamed him by saying "real estate only goes up". It's uphill for this guy now, until he slides into BK, oh yea, Bush got rid of easy BK.
I am telling every RE Agent I see to buy this May Issue......that could bring them around (inform them) one weasle, I mean person, at a time. They have no clue.
I tell every realtor/seller they are over pricing. I want to buy, but am very wary about jumping in too soon. When do HP readers think the time to buy - not a low ball, but really get a decent house for a realistic price will be? Specifically in NJ. The whole state is too high, taxes are outrageous and weather forecasters have us pegged for the next hurricane catastrophe! Bargain prices anytime soon?
Actually, I think Harpers came out with its story several day before Fortune's.
wait for at least 2 yrs before you buy.
Harper's is the best magazine in America, bar none.
Buy now, I need you to loose all your money to force the market down further.
Listen to the interview with author, Michael Hudson, Ph.D., posted on this site:
http://newspundit.net
The author predicts a nightmare scenario of collpasing real estate prices will result in debt servitude for millions of Americans and economic chaos. The article has about 12 charts to bolster everything that Hudson says.
To the person who put up the newspundit.net link, could you post the exact link to that article? That website is very difficult to find any information.
I read the Harpers article. Like the title implies, those who thought they would become "lords" or "barons" (wealthy landlords) will instead become "serfs" (people drowning in debt).
It begins with a well-written one-page article, and then goes through a series of about 20 graphs and diagrams to explain why the bubble is coming. One of the funnier graphs is a picture of Japan's real estate prices over the last 25 years. They added snow and clouds to the graph to make it look like Mount Fuji. Here are the titles of some of these diagrams and graphs:
"Mortgages account for most of the net growth in debt since 2000"
"Real estate prices have far outpaced national income"
"Housing prices have far outpaced consumer prices, even as monthly payments remain affordable"
"Mortgage debt is rising as a percentage of GDP"
"Rich people are getting a bigger share of overall economic rent"
"The miracle of compound interest will inevitably confront the S-curve of reality"
"In Japan, real estate prices fell as quickly as they rose"
"Interest rates are on the rise"
"The annual sale of existing homes has more than doubled since 1989"
"Negative equity traps debtors"
The article then ends with this excerpt:
"Free markets are based on choice. But more and more homeowners are discovering that what they got for their money is fewer and fewer choices. A real estate boom that began with the promise of "economic freedom" almost certainly will end with a growing number of workers locked in to a lifetime of debt service that absorbs every square penny. Indeed, a study by the Conference Board found that the proportion of households with any discretionary income whatsoever had already declined between 1997 and 2002, from 53 percent to 52 percent. Rising interest rates, rising fuel costs, and declining wages will only tighten the squeeze on debtors."
"But homeowners are not the only ones who will pay. The overall economy will likely shrink as well. That $200 billion that flowed into the "real" economy in 2004 is already spent, with no future capital gains in the works to fuel more such easy money. Rising debt-service payments will further divert income from new consumer spending. Taken together, these factors will further shrink the "real" economy, drive down those already declining real wages, and push our debt-ridden economy into Japan-style stagnation or worse. Then only the debt itself will remain, a bitter monument to our love of easy freedom."
I'm looking at taking out a 50-year mortgage to buy a 500sf studio condo in San Diego. Is it a good time to buy now?
The Fed will prevent a housing collapse through inflation. Bernanke is no inflation-hawk.
I'm looking at taking out a 50-year mortgage to buy a 500sf studio condo in San Diego. Is it a good time to buy now? ..........YES BUY NOW
If you wait a year, GM will give you a FREE 500 SqFoot condo in San Diego with a purchase of a SUV. . .SD will hit 20,000 listings this coming week. . .they already went over their all time high of 19,250 a few weeks ago!
To the JERK who said I was a "freaking idiot" for asking for the link to the Michael Hudson audio, this is the link:
http://www.michael-hudson.com/
Post the direct link to the REAL site!! The website you are pumping is just a link to a poorly constructed site with about 8 billion links on it. I did an Edit--->Find for "Michael Hudson" (which came up with nothing because it is actually "Michel Hudson" so learn how to spell!) and then I finally found it after I typed in "Hudson", and I had to scroll down at least 10 pages to find it! If this is your site, may I suggest you take a beginners course in web design!
I've got a sledge hammer in my hands. Is it a good time to bonk myself on the head?
Dear Anaon,
Thank you for your research and the real Hudson link. (:
"The Fed will prevent a housing collapse through inflation. Bernanke is no inflation-hawk."
Yes, just like those in Weimar Republic in 1920s. The nominal price will stay up, but sadly the purchasing power will be largely erased by Prof. Ben's helicopter-dropped money.
if we measure housing using gold price, we can easily see what true picture is. and the picture is investing in housing has been a losing-game since 2000.
To the person who is thinking of buying awith a 50 yr. loan (if you are serious, which is hard to believe):
Are you nuts? The market is just STARTING to implode.
And NEVER take out a 50 yr loan. 30yr at the most, preferably 15yr.
Yikes. I hope that was a joke
Here is the radio interview:
http://64.27.9.54/archive/index.php?l=8&p=BTS_Suzi/04_24_06a_BTS_Michael_Hudson_on_the_cost_of_housing.mp3&m=1
better link:
http://www.michael-hudson.com/
I was a little disappointed with the Harpers article. It is consistent with what most people on this blog believe, but superficial and not much new information. Basically "Housing Bubbles for Dummies."
I think the idea is for all the Harpers readers to copy it and send it to their less intelligent friends and relatives.
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