Michael Mullenniex 1:43 p.m., May 25
It's Not 2004 Anymore, Dorothy; and Your Little IB Shack Ain't Worth a Plug Nickel
Reading James Boyce this morning on the Huffington Post got me to thinking about an exchange I had with a real estate bloviator at a local coffee shop a few years ago.
I remember his gleeful smirk most of all. It was 2003 or 2004, and homes--let's be honest, shacks--were going for three quarters of a million bucks and more. It was hard for the man to keep from salivating all over himself. But he stopped when I said:
"No worries, my good man. In less than a decade, those homes won't be worth half what they're selling for now. Possibly less."
"Do you own a home?" he asked, his smirk gone.
"No. I rent."
The smirk came back.
"A money hole," he dismissively pronounced. I was ready for it: it's a mantra with most people. (Not anymore, I must add.) "What would you know of the real estate market?"
"I know it's incredibly corrupt," I replied immediately, "and it feeds off herd instincts. I also know that what Lao-tse said two-and-a-half millennia is also true: that 'return is the way of the Tao'. The market will die--as it must. And I will celebrate it."
He stared at me as if I were some sort of monster. He grabbed his tall latte and left without another word.
Looks like I not only won the argument, I won the game, period.
I tried warning many not to buy back then. I told them it was an act of insanity, of glaring stupidity. That the mind-boggling debt The Worst President In History was racking up (more than all other presidents combined) was going to come crashing down on the housing bubble like a ton of overpriced bricks. No one listened to me; many castigated me. Hmm.
What most are calling a depression I like to call "a return to sanity."
Let's hope that Americans heed that call.
Wonder how that real estate bloviator is doing today.
James Boyce's article: http://www.huffingtonpost.com/james-boyce/the-darwin-depression-tim_b_151336.html