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[quote=Anonymous][quote=Anonymous]Continuing the lecture, the QE in his post refers to the Fed's quantitative easing program. Basically, the Fed has been buying a whole lot of financial instruments. This increase in demand keeps their prices up.

The Fed now has a giant balance sheet that it needs to unwind (sell off, slowly). This is called tapering. At present, the Fed is still buying assets each month, just less than it had been doing. This is tapering.

The risk of continuing to prop up demand for assets is that it keeps their price high. This can cause inflation. So, I THINK, the poster means to say that the prolonged QE program (not the tapering of said program) has the potential to unleash lots of inflation. The Fed is acutely aware of this and is monitoring it closely, I assure you. [/quote]

Glad someone is paying attention.  PP here, I expect inflation in everything except housing prices, which have been supported by the asset bubble caused by QE.

Why is this so hard to understand?  There has been massive stimulus from the Fed unlike anything in history? Why do we not expect problems from such intervention?  Housing is unsustainably expensive now, nationwide, and removing the low interest rates only exacerbates the problem.

Look at the stats, there are fewer and fewer first time home buyers every month.  We are all just buying and selling houses among are selves and with hot money investors who will leave the party as soon as rates rise.  I would love to wrong, as we plan to sell in a few years and downsize.  I'm just telling the folks looking for inventory why the market is so screwed up; too much intervention, and if you buy you better buy for long term and be very liquid.

I am still really curious about what jobs are growing in our region?  The bubble is a national problem, and I'm sure a lot of real estate shills will chime in that real estate is local (whatever; if job market improves elsewhere and out-migration increases, you know *that* national trend will affect prices here. Its not like we're on a beach here or anything), but supporting our local economy I am curious where folks see growth? I think we are just treading water.

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