Luskin is a writer for Smart Money Magazine and an economist at a consulting firm. I’ve been following his writing and have even posted a few articles. He made some very good arguements about why the Federal Reserve should NOT have lowered interest rates last week. I agreed with him. The Fed obviously did not and this is his response. I’d point you to the graph that I posted that is also available with the story link. This graph shows total US Household Assets versus Liabilities and then shows how much of our liabilities are in sub-prime (and then how much is in trouble….very little).
Perhaps the graph can shed a little perspective on how overblown this SubPrime “crisis” really is.
There is no doubt that Real Estate will be in trouble for some time to come, but that is the nature of markets, they cycle.
Scott Dauenhauer, CFP, MSFP, AIF