I was listening to a Cypriot Historian on the Radio just now. He has lost a lot of money, I was just taken from his Bank account. I don't think they had much if any warning .........
So many of my friends and clients who have saved and or paid into pension funds all their working lives are now living in relative hardship. I say relative. It feels as though the 'underclasses' as in under the 'top layers' are all being knocked down to even lower levels.
http://www.huffingtonpost.com/2013/03/16/cyprus-bank-bailout_n_2891186.html
queen - thanks for this topic.
after 9/11, and the immediate and preciptious stock market crash - real estate was touted as "the safest thing, since home values don't drop 10% overnight".
aha - but they apparently can drop 20-30% over several years, as we subsequently found out.
"typical americans" responded to expert opinions, "flip that house" style tv shows, and changes in home financing laws by scooping up properties which had previously been unaffordable, taking advantage of liar loans, zero down loans, and mortgages with ultra low teaser rates which in many cases doubled after 3 years or so.
and then "everyone" was surprised that defaults rose alarmingly. average home sale prices are still fr below where they were in 2007, and there are millions of home still wending their way thorugh the foreclosure process, abandoned and decaying, as 50 states' attorney genererals compete for re-election by "taking consumers' sides".
but all things apparently work in cycles. Gold - the most traditional bastion against uncertain times, has skyrocketed. half the world feels its sure to crash, the other half feels its going to double again.
and now the drumbeat of real estate - as a hedge against inflation, the crash of the US dollar, and a "better bet" than stocks or precious metals - has resumed. i get some sort of email every week it seems, warning me that either land (unimproved land, at that - with no buildings on it!) and precious metals are the "only safe bets"
i predict that we'll know THESE investments have reached a bubble of irrational exuberance when we start to see congress drafting bills to permit IRA and 401K holders to put their retirement savings into REITs (real estate investment trusts) and bullion.
Our legislators have historically been the perfect negative economic barometers, having facilitated everything from the absurd margin loans which led to the 1929 stock market crash to the dot.com boom, to risky mortgages, and now "green energy" and "crowd funding" - the online promotion of stock shares in entrepreneurs startups, without the risk and disclosure oversights of the SEC and other traditional regulatory agencys. Last year an act of congress was passed specifcally bypassing those regulators, and we are now free to send our money - online - to virtually anyone with a compelling narrative about a miracle cure he has discovered; 100% certified organic test tube meat (no animals were harmed in the making of this product); or perpetual motion windmills that "big energy dosn't want you to know about".
xxxx
