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Injecting more money into the economy worked for Zimbabwee

Discussion in 'Political Discussion' started by MrBigglesWorth, Sep 28, 2008.

  1. MrBigglesWorth

    MrBigglesWorth Rookie

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    How Bad Is Inflation in Zimbabwe? - New York Times



    and we wonder prices go up???

    injecting more money is an attempt at maintaining the status quo and keeping house prices high.

    well what we were doing before wasn't working. why continue it?
    Last edited: Sep 28, 2008
  2. MrSparkle

    MrSparkle Rookie

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    Just how overvalued is the housing market right now?


    Where is it the worst?
  3. PatriotsReign

    PatriotsReign On the Roster

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    It is difficult to answer that question because it depend on a lot of factors. First, how difficult it will be to get a mortgage, what the interest rates will be and finally, how the economy fairs moving forward.

    Home values must reflect the average household income in a given market. So let's say the average HH income in Plymouth is $60K. That means a family earning $60K has to be able to afford an entry level home.

    Right now, $60k is enough to afford a $230-$250K home. So when the average entry level home in plymouth, MA falls in that range, the market will start moving again.

    Keep in mind, there is no way to stop real estate from continuing to decline unless they go back to subprime mortgages...and we know that isn't going to happen. "Pumping money" into the economy will have no impact upon home values.

    The ONLY thing that will help real estate is to make homes more affordable. And that means prices still have to come down a bit. In eastern MA, I'd say about another 10-15% will do it.

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