[Homestead] Housing bubble or froth

Don Bowen don.bowen at earthlink.net
Wed Nov 8 11:30:51 EST 2006


At 11/8/2006, you wrote:
>If the Fed finds that the economy is in
>danger due to real estate market conditions it will lower their
>already low interest rate to stimulate the economy. This will allow
>yet another wave of refinancing.

Home finance rates have been somewhat independent of the Fed over night 
rate.  One reason was the Chinese money in the market.  All those Chinese 
goods in Walmart helped keep mortgage rates down so people could refinance 
and buy more Chinese goods in Walmart.  Several factors have changed that 
and one small symptom is Walmart not hitting its revenue targets and going 
to even steeper discounts in Chinese goods.  The Chinese people themselves 
want some of the goodies, refrigerator, TV, and automotive sales have 
climbed in China.  This has resulted in heavy purchases of oil by China and 
the run up in prices.  The slowdown in Walmart sales and other markets is 
reflected in slowing oil sales to China and a recent easing of 
prices.  Just one little loop in a very complex global market.



Don Bowen              Awl Knotted Up                       KI6DIU
http://www.braingarage.com
My travel journal
http://www.braingarage.com/Dons/Travels/journal/Journal.html

I am omnivagant.  


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