“Shouldn’t the relevant authorities be doing something about this?”
by ChrisDecember 4th, 2004 10:13 am
-Chinese Prime Minister Wen Jiabao on the decline of the U.S. Dollar.
I wouldn’t bet on it Mr. Jiabao
I’ve noticed that whenever I try to discuss my concerns about the declining value of the dollar or the housing bubble, I generally get the same peculiar reaction. It usually comes in the form of a glazed, disturbed look that you might give to some gun nut who is stocking up on canned goods and getting ready to move into his bomb shelter in order to wait out whatever apocalyptic, nightmare scenario is haunting his drug addled mind. That’s usually followed by some sympathetic comment to my wife about what a nice person she is to put up with such an odd fellow.
I hope the owners of those gazes are right and that I am indeed a nut.
Nevertheless, my own personal concern is this; my wife and I have been saving up money to buy a house. We have managed to put away, what is to us, a pretty decent pile of cash. Unfortunately this seems like an awful time to buy real estate. Housing prices have skyrocketed over the last decade and in my estimation, uninformed though it may be, have in many cases exceeded their real value.
Now this isn’t as big a concern in Philadelphia as it is in other major cities, especially on the West Coast, as our housing prices are still relatively low and houses themselves are in short supply. It’s still a concern, especially when you consider that the price of a house or condo in some Center City neighborhoods is often four or five times what it was ten years ago.
The next problem is this; if we decide not to buy until the market has completely settled or the bubble has popped, this really isn’t a good time to be holding onto a big pile of cash. Even with the very best interest rates on a CD or Money Market account, I have concern that those interest rates will not fully cover the decline in the value of the dollar. Additionally, the stock market seems like a less than stellar option right now.
I don’t have any answers, just allot of questions.
Just to clarify, I’m not a gun nut, I don’t have a bomb shelter, I just checked the kitchen cabinet and the only canned goods I have are two cans of Pepper Pot soup and one can of Chicken Noodle soup.
December 7th, 2004 at 6:13 pm
Chris, I don’t think the glazing over is necessarily because people think you’re crazy. In my case it would be because anything that sounds like Econ 101 makes me glaze over - and that’s much to my chagrin. I KNOW I should be more interested in learning about all of the stuff you talk about in this post, but no matter how hard I try, the glazing begins. So good for you, and keep it up, and ignore people when they glaze over - we need someone to keep us focused on these issues.