Quote:
Originally Posted by jamesqf
Now you're just being silly. Or did you sleep through the housing bubble? Almost entirely demand-driven. A thing's worth what someone will pay for it, and with easy credit and an expectation of ever-rising prices, demand was pretty high.
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The bubble is worse in less stable markets. You are ignoring or missing my point. At the height of the bubble my property was worth
five times what I paid for it; now it is 'only' worth
four times the original amount paid. My comparison is that of now, after the bubble, not during it.
The housing market here is stable. The turnover rate is about the same as ever, so it has nothing to do with increased demand.
The fourfold increase is all inflated "value". The price has increased and some may think that is a profit, or some form of progress. But the house is the same. There is no increase in real value of it, just an increase in price,
which actually is a devaluation of the currency. The money simply buys less, as reflected in the price
which is ever rising over time. THAT is inflation, no matter how you look at it, or no matter to what you attribute the cause.
People think that rising prices are beneficial to them. Sure, they have more money now than before, but it doesn't buy more, it buys less. They don't realize it because they only think short term.
Remember, the government can always print more of what is in your wallet. Inflation is the cruelest tax of all: it fools people into thinking they are getting wealthier, when in reality they aren't.