T Nation

Great Depression Begins?

"Even with the steep discounts on Detroit-area properties, some buyers handed over their deposits with a wince.

“I’m not sure it’s congratulations,” said Kirk Neal, a 55-year-old auto body shop worker who bought a ranch in the suburb of Oak Park for $34,000. “My wife is going to kill me.”

Realtor Ron Walraven had a three-bedroom house in the suburb of Bloomfield Hills that had listed for $525,000 sell for just $130,000 at the auction.

“Once we’ve seen the last person leave Michigan, then I think we’ll be able to say we’ve seen the bottom,” he said."

http://www.foxnews.com/story/0,2933,259907,00.html

Sounds like the city is in a death spiral.

Housing prices are dropping because everyone thinks there house is worth more than it actually is.

A house is only worth what people will pay for it. Because there was a bubble in real estate, people seem to think their house has a certain value just because some jackass expert thinks it does.

The bubble burst, people are in trouble. You need to sell, your screwed.

What the hell are we supposed to do about it?

[quote]Beowolf wrote:
Housing prices are dropping because everyone thinks there house is worth more than it actually is.

A house is only worth what people will pay for it. Because there was a bubble in real estate, people seem to think their house has a certain value just because some jackass expert thinks it does.

The bubble burst, people are in trouble. You need to sell, your screwed.

What the hell are we supposed to do about it?[/quote]

2/3 of all Americans are now homeowners. This would be good, but the trouble is that many of those people were able to buy only on VERY shaky finances. Its a house of cards (no pun intended ;D )

What’s going to happen to the rest of this country when lots of people have a $300,000 house, they lose their jobs, and the house only fetches $125,000? Same question: what happens to a big ol’ snowball that starts rolling down a mountain?

With our massive debts and real estate about to collapse, it might be wise to buy a cottage WAAAYYYY out in the woods.

Who would have thought that you couldn’t spend your way out of a depression?

[quote]Headhunter wrote:
Beowolf wrote:
Housing prices are dropping because everyone thinks there house is worth more than it actually is.

A house is only worth what people will pay for it. Because there was a bubble in real estate, people seem to think their house has a certain value just because some jackass expert thinks it does.

The bubble burst, people are in trouble. You need to sell, your screwed.

What the hell are we supposed to do about it?

2/3 of all Americans are now homeowners. This would be good, but the trouble is that many of those people were able to buy only on VERY shaky finances. Its a house of cards (no pun intended ;D )

What’s going to happen to the rest of this country when lots of people have a $300,000 house, they lose their jobs, and the house only fetches $125,000? Same question: what happens to a big ol’ snowball that starts rolling down a mountain?

With our massive debts and real estate about to collapse, it might be wise to buy a cottage WAAAYYYY out in the woods.

[/quote]

And what do you propose we do? I just don’t understand the point of the thread.

And that $300,000 house? It’s not a 300,000 house if no one will buy it for that.

Bubbles have burst before HH, it won’t ruin the nation.

Seriously, either propose a solution to discuss, or this thread is basically over…

[quote]Beowolf wrote:

Bubbles have burst before HH, it won’t ruin the nation.

Seriously, either propose a solution to discuss, or this thread is basically over…[/quote]

I can’t help it if very few people understand metaphysics. Most think that reality can be cheated (for ex, that you can spend more than you earn, forever). Most people think that you can create a mixed economy and that the bureaucrats in charge will always be honest and fair. Most believe that you can create positions of power and that this would never be a magnet for maggots who crave power over others.

So, I guess the thread is over…