First Out the Door

The housing boom began with easy money and is ending with tight money. From a personal standpoint, I would note that each time the fed raises interest rates 25 bps, it becomes more unaffordable for me to own a house, but more profitable for me to keep my “down payment” in a money market, which is now yielding about 4.7%.


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``It is difficult, if not impossible, to recall a time when so many central banks were so crystal clear about their desire to withdraw liquidity from the system,'' wrote Tim Price, a strategist at Union Bancaire Privee in London, in a research note. ``As always when leveraged investors are invited to the party, everyone thinks they can be first out of the door when they hear the chimes at midnight.''

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