The latest TSB/ERSI House price index released today shows house prices rising at their fastest rate since 2000. The rise expressed as a percentage is a fairly useless statistic as people are paid in Euros not percentages. The monthly rate for March nonetheless was 1.3% , and a spokesman for the TSB suggested that inflation will moderate later in the year. (he hopes)
Ironic that the vested interests always refer to the non-occurrence of a crash as evidence that the bear case is flawed. It could equally be said that the much vaunted soft landing is pretty conspicuous by it's absence.
http://www.rte.ie/business/2006/0427/houses.html
Ironic that the vested interests always refer to the non-occurrence of a crash as evidence that the bear case is flawed. It could equally be said that the much vaunted soft landing is pretty conspicuous by it's absence.
http://www.rte.ie/business/2006/0427/houses.html
3 comments:
The no-crash-yet-so-no-crash-ever argument makes me think of the analogy of the muppet in a hot-hatchback that likes to travel at 60mph down a residential street. He may have "been doing it for ages" and "not crashed yet", but that doesn't mean he won't and that I am a doom-monger for warning him to slow down.
A crash needs a trigger. i.e. a car pull out in front of him. I can't say when that will happen, but that does not weaken my argument.
The debt-fuelled housing market is like a speeding car getting ever faster, just waiting for that trigger to end the madness. Though, just like the speeding motorist, expect the heavily indebted to blame others afterwards for their folly.
By the way, nice blog.
Cheers Flash,
I agree the, 'it hasn't happened so it wont happen' argument is all pervasive at present. A virtuous circle which has allowed the bubble reach this frankly insane size. The longer the bubble persists the further the market is transported from fundamentals and the worse the crash.
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