Posted by
rycK on Monday, April 14, 2008 10:18:15 AM
The US Has Wrecked the Housing Market World Wide.
Most nations of the known world, known at least from 1620 onward, has admired the colonies of North America, but never acknowledged that American were in the lead. Spain brought in untold wealth in gold while the colonies were struggling with mosquitoes and barbarians. The US was called in to mediate in the 1000 year old wars in Europe and parts of Asia and applied some wisdom and more money upon those left standing after 81,000,000 dead bodies littered the landscapes.
After crushing the idiotic USSR and its lackeys scattered around the world, the US seemed to rein supreme in many matters. Reason and soap were forced upon the far left along with offers of prosperity if they would only reinvestigate capitalism and dump the socialist idiots.
The Americans were probably rightly blamed for the Great Depression and now new faults have been found in our society and announced with trumpets and song: The US housing crisis has infected the rest of the world. Private property is the reason.[1]
From an analysis printed in the New York Times, not always a friend of capitalism and free trade, we read this in an article entitled: Housing Woes in U.S. Spread Around Globe [2] by Mark Landler [European Economic Correspondent of The New York Times, based in Frankfurt.]
Bringing us the European view he writes:
“DUBLIN — The collapse of the housing bubble in the United States is mutating into a global phenomenon, with real estate prices swooning from the Irish countryside and the Spanish coast to Baltic seaports and even parts of northern India.”[Emphasis is mine in all quotes]
One has to struggle a bit to connect these events as the citizens have different cultures, varied monetary wherewithal and very different governments marked by excessive socialism. But, we can probe this notion for elements of truth.
“To some extent, the world’s problems are a result of American contagion. As home financing and credit tightens in response to the crisis that began in the subprime mortgage market, analysts worry that other countries could suffer the mortgage defaults and foreclosures that have afflicted California, Florida and other states.”[3]
Does this mean that the Europeans have crooked lenders too?
“For countries like Ireland, where prices were even more inflated than in the United States, it has been a painful education, as homeowners learn the American vocabulary of misery.
“We know we’re already in negative equity,” said Emma Linnane, a 31-year-old university administrator.
She bought a cozy, one-bedroom apartment in the Dublin suburbs with her fiancé, Paul Colgan, in May 2006, at the peak of the market. They paid $575,000 — at least $100,000 more than it would fetch today. “I sometimes get shivers thinking about it,” Ms. Linnane said, “but I’ll let the reality hit me when I go to sell it.”[4]
What is some young ‘university administrator’ doing with a $575,000 house [with only one-bedroom??]. Does she have one of those socialist jobs. How much does she make?
When some people buy things it might be termed an ‘investment’ in American terms. When an investment turns sour can we expect lenders across the pond 5000 miles away be blamed? Of course!
“That reality is spreading. Once-sizzling housing markets in Eastern Europe and the Baltic states are cooling rapidly, as nervous Western Europeans stop buying investment properties in Warsaw, Tallinn, Estonia and other real estate Klondikes.”[5]
This part uses the gold hysteria of at least 100 years ago. Oh! The speculators guessed wrong and lost money! Damn. From the article, we learn that this same speculation is failing to produce products in India, China, Hong Kong, and many other parts of the world.
“Much of the retrenchment seems to be following the basic law of gravity: what goes up must come down. With low interest rates helping to inflate housing bubbles in many countries, economists said the confluence of falling prices was predictable, if unsettling.”
We are indebted for the cliché here. The Walter Duranty Papers [6]usually grope for some anti-capitalistic root cause for any social malady and now low interest rates caused higher demand for real estate! This is astonishing! Can we give this guy the Nobel Prize in economics for this jewel? Didn’t Adam Smith once live in Britain?
““The boom in house prices was actually much bigger here [Britain, ed] than in the U.S.,” said Kelvin Davidson, an economist at Capital Economics in London. “If anything, people should be more worried than in the U.S.””
Okay, now what is the solution??
“In Spain, more than four million homes were built in the last decade, more than in Germany, Britain and France combined. Average house prices tripled in parts of the country, as Spain’s torrid economy attracted immigrants and Northern Europeans snapped up holiday homes along the Costa del Sol.”[7]
Speculators!! Capitalists!!
“But some worry that the housing meltdown could spoil Ireland’s recipe for success. Like Spain, it attracted lots of foreign workers, many of whom came for well-paying jobs in the construction industry. That fueled the Irish rental market, which has remained buoyant and been a source of income for Ireland’s many real estate speculators.
“If the immigrants go back home, will this hurt the rental market?” asked Ronan O’Driscoll, a director in the Dublin office of Savills, a real estate firm. “If that happens, it would definitely cause foreclosures.”[8]
But, what about the solution??
This is all the fault of the greedy capitalists in the US. The obvious solution, echoing the best elements of socialism, is to have the United Nations put up a special greed tax on the US and use that money to compensate those poor people who thought they could be speculators and make money like the Americans used to do. I also hurry to mention that if the Europeans had their cherished subsidized and public housing that this would never have happened. When some 31 year old with a clerk’s job can buy a $575,000 house we can conclude that the taxes are too low.
Raise taxes and bring back prosperity!! Give us more socialism!! Where is Paul Krugman when you need him?
The proof for this: Cuba and North Korea do not have this problem.
Buy gold.
rycK
Comments to: ryckki@gmail.com
[6] In honor of that celebrated Communist stooge and liar and winner of the Pulitzer Prize for the NYT. The color RED is used in my essays in honor of Walter Duranty, a saint, if there could be one, in the Marxist Archives of Honor.