Timberrrrr!

From InstaPundit comes this link: Get out of the way of the housing market. Keeping poor people in homes they can’t afford, postponing foreclosures, artificially lowering interest rates all merely delay the day of reckoning. We have too many houses priced too high for people to afford them. That’s something the government can’t fix. The marketplace can. I believe I’ve mentioned this before.

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One response to “Timberrrrr!

  1. Peg

    Oddly enough, if the government would only “allow” this – I think that we would get to a better place sooner.

    Much of what damages markets is uncertainty. If people are unable to quantify underlying data, then they are unable to weigh, judge and make wise decisions. As long as the government appears to be on the course of “Hey; if you’re in trouble, we’ll bail you out” people are actually less likely to leap in. What is the “real” value of housing in this case? What if the government suddenly stops with the stop-gaps? Who gets the largesse – and who does not?

    If people must depend on the “hard” data alone: location, condition, dimensions and the like – with the understanding that “it is what it is” – then I think the market might “come back” more rapidly. Oh, I’m not saying that we might not see more drops before that happens. Nevertheless, IF we stopped the bailouts, people would be able to use old-fashioned evaluating and understand the rules of the game – and go from there.

    Ditto to our financial markets.

    And – thanks for the highlight above, Chris! If ONLY everyone had listened to me 3 years ago, when I kept on saying, “It seems impossible for housing to go up 10-15% annually as income goes up 2-3%.” I guess it actually was impossible, after all.