Has the Bubble Finally Burst?

miss muffett: not to single you out, but when people in your position say that this moment is “decidedly mixed” for you, it seems insincere and self-serving. i don’t understand why you can’t just say, “it was good for me” and leave it at that. as far as the housing market goes, you profited, a lot, and in a way that had nothing to do with skill or (from what i can tell) work. yes, it was luck, but it was still purely good for you. on the flip side, other people – those who bought more recently, will lose, a lot. for the most part, they were unlucky. and as for the economy as a whole, you are no worse, and no better off, than anyone else. so, not “decidedly mixed.”

as such, the attempt to distinguish yourself from the wall street “rogues” with bonuses again comes off as self-serving. it’s not like most wall streeters were the architects of the faulty system. most of them just sat, did what they were told, and cashed in those bonuses, just like you did when you sold your house. why does that make them “rogues” and somehow more deserving of suffering, or less deserving of their payday, than you?

you are decidedly ahead of the game. it’s okay to admit it.

Polemicist – maybe you should write an op-ed for WSJ since this is a theory that no one but you seems to espouse. Enlighten the world, please.

All this talk – with certainty – of the downward direction of real estate prices sounds a lot like the real estate agents and “experts” a few years back who stated that prices must go up.

No one here knows for sure and pontificating as if you do doesn’t make your guessing any more convincing. Only time will tell. Everything else is a complete waste of time.

Polemicist: are you related to Che Guevara? Your rhetoric is somewhat Latin-populist but without the charisma.
Do you have any idea what you are talking about?
Are you high?

gkw:

Yes, I have spent time in Latin America. Most people are familiar with hardship on some level. They aren’t going to riot because stores don’t have bread for a day or two. They are used to public utilities not being available at all times as a general rule. They also have no problems with the police carrying submachine guns and using them to maintain order.

My point is merely that life has rarely been easy for people in Argentina. The tolerance for pain in this country and this city in particular is shocking low. Why do you think I loved making fun of those nutjobs in Carroll Gardens? The rest of the world laughs at us when people complain about buildings being 10 feet too tall. There are far more pressing problems in this world.

The primary issue everyone must realize is the current crisis ultimately is due to the onset of peak worldwide oil production. Unlimited credit expansion is predicated on continued economic production. Unfortunately, such production requires energy, which today means oil. Credit, by necessity, cannot continue to expand indefinitely until an alternative is found or we completely reorder society. There is no time to do either, thus at some point – credit expansion will stop and asset deflation will set in.

Part of the reason I so fervently support higher density development is there a chance, a slim one, that the urban nature of this city will make it the center of a new economic order in the future. We are the only place in this country that has 3rd world level energy usage, and it is the high density development and public transportation network that makes it possible.

There is no question energy distribution will falter when we no longer can borrow from foreign governments to buy oil. Food shortages will be a reality sooner than you think. Industrial agriculture has destroyed much of our farmland. Current farming techniques are dependent upon imported minerals like phosphorous and natural gas for fertilizer. The price of both of these necessities has tripled or worse just this year alone. We should have learned from the Soviets: collectivized farms don’t work.