Walk a Kb or Two in my Moccasins- Nobody 'splained it to me like that!

Simple answers to Complex Questions and Complex Answers to Simple Questions. In real life, I'm a Greater-Toronto (Canada) Realtor with RE/MAX Hallmark Realty Ltd, Brokerage. I first joined RE/MAX in 1983 and was first Registered to Trade in Real Estate in Ontario in 1974. Formerly known as "Two-Finger Ramblings of a Forensic Acuitant turned Community Synthesizer"

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Thursday, February 17, 2011

Inflation - Too much (or too cheap) money chasing finite quantity of goods

A) Liberty Mutual's Kelly Says Inflation May Rise to 9%  by Devaluing Currency
From Bloomberg Feb 17/2011

B) House prices to match inflation: CMHC
from BNN Feb 17/011

So ..... if we see 9% annual inflation in a few years ..... House prices will ?follow?  or ?not follow?

In late 70's we had 5-10% inflation, but prices were flat (after a doubling in 1972-1974)
Interest was 12% on first mortgages.

In early nineties we had 1-5% inflation (falling rates of annual change) and prices fell 25% from 1990-1996 (after running up from 1985 to 1989) -
Interest on first mortgages was 7-10%.
Where are we now?


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