Now, he has even worse news, that the meltdown we have experienced is just the tip of the iceberg.
He cites four reasons that the housing meltdown is just the beginning of a long term crunch that can only be regarded as a second great depression. They are:
- There are 18.4 million homes saturating the market.
- The full unemployment rate is 9.2% with an underemployment rate of over 18%
- 28% of home owners are in underwater mortgages
- When interest rates go up to an estimated 7.5%, the average home owner will take a value hit of approximately $120K.
The inter-connecting bubbles that are about to hit? First will be the pull-out of foreign investment from the United States (this is already happening, just look at the stock market).
Next will be inability of the US to borrow, which will leave the debt of the US unserviceable under present conditions. The next to hit will be skyrocketing gas prices.
This will not occur because of a shortage, but from the devaluation of the dollar. Finally, as food prices rise and services are cut, items such as art and other subjective value collectibles will nose dive.
Interestingly, Wiedemer does not believe that gold is a good investment to protect oneself against the coming calamity. He believes that gold will be the final bubble bursting that will result in a global depression.
He recommends that people put their money into grain and coal options. True, these are risky, but he is right (in my opinion) about gold.
Buckle up folks. The ride is about to get a lot more interesting.
Appraisal Source is a New York based residential real estate appraisal firm. If you need a highly qualified New York City or Long Island home appraiser to provide an independent real estate appraisal for any reason, they can be of service to you.
Here’s the original article…4 Reasons Housing Will Get Worse; 1 Simple Solution