November 17, 2005
EVEN WITH ARTIFICIALLY HIGH INTEREST RATES... (via John Resnick):
Home sales set a record - again; prices up almost 15% (USA Today, November 15, 2005)
Existing home sales set another record in the third quarter of 2005, and prices jumped nearly 15%, but even the National Association of Realtors in its report Tuesday said the housing market will probably begin cooling after its five-year boom.
And poor Paul Krugman dumped all his housing stocks for euros and oil futures.... Posted by Orrin Judd at November 17, 2005 6:17 PM
Actually, Toll Bros. (a leading home builder) is down almost 40% since June, although D.B. Horton (another big builder) is continuing to climb. Full disclosure - I don't do housing stock. Krugman should probably have held his; by selling, he is admitting he is an evil Republican speculator.
On the other hand, gold hit $480 this week, which is an 18-year high. Perhaps Paul bought some.
Posted by: jim hamlen at November 17, 2005 6:41 PMYeah, that gold price is a mystery. (To me, anyhow).
30 year Treasury Bonds are at 4.74%, 10 year at 4.55%, and 5 year at 4.49%, so nobody in the money markets is expecting any inflation, but gold is up 7% in six weeks.
$ 480, btw, is only 5% higher than the 1940 gold price of $ 460 [in 2005 dollars].
Real estate and the stock market have crushed gold as a long-term source of wealth.
Posted by: Michael Herdegen![[TypeKey Profile Page]](http://brothersjuddblog.com/nav-commenters.gif)
at November 17, 2005 9:15 PM
Europe is burning--people buy gold when they're scared.
Posted by: oj at November 18, 2005 7:16 AMMichael: Isn't the point of buying gold that it is a long-term hedge against inflation? Looks like it's working exactly as intended.
Posted by: David Cohen at November 18, 2005 7:39 AM