SM, the main reason I'm bearish is that the trend is down. I know, too easy, but as you've no doubt read on ET and elsewhere, usually that's the right answer. In addition, I don't see the huge debt overhang we have being easily erased without a lot of painful liquidation. That means lower prices. With regard to your points:
Easy to get a job? Sure, if you want one in the service industry or selling real estate (grin). This ties to consumer confidence, which I think will start to plunge as more and more people are forced to retrench. The spending binge we've seen the past few years has emanated from people ringing the home equity cash machine, and I think those days are gone.
With regard to offshore investors buying due to the weak dollar, I have a contrary view there, too. In almost all cases, by the time foreign investors "discover" a great "deal" offshore, the move is usually over or nearly so. They tend to be the last suckers on board.
I think the dollar has made an intermediate term low. Just look at the bearishness! This is a pure contrarian play. Why should the dollar rally? Beats me. What I do know is it's valued against all the other shitty paper money out there so anything can happen. I'm sure the bastard economists will be able to explain it all as usual, AFTER the trend change becomes obvious.
I think the looming disaster is being masked by the amount of time it DOES take for it to become obvious. There was a LOT of inertia in RE built up over decades. Like a large ship, it doesn't turn on a dime. In my view, though, it IS turning, and from north to south. Again, the trend, my friend.
The preoccupation with reasons is something people, (including me), seem to be unable to resist, but the real reasons are only clear after the fact - rarely before. For me, the only "reason" I needed was the ability to recognize the extreme sentiment conditions always accompany major tops and bottoms. In 2005, we were there in RE. At the time, the news was uniformly bullish. Of course, at the time, that's also the only thing people wanted to hear, so the media delivered.
Another reason I don't think we're at a low is many folks, including posters on ET, already think there are "opportunities" here and there. At the real bottom, the sentiment will be so gloomy virtually no one will recommend buying RE, and those who do will be ridiculed, just like RE bears have been since the top. That's fine, it's just how things work.
I remember how precious metals collapsed after universal bullishness reigned in 1980. Near the top I needed some money so I took five rolls of silver dimes I had and sold them for a $1 each at a local coin shop. My motivation was to get some cash, but it also gave me my first experience of selling at the top of a mania. I still get a warm, fuzzy feeling when I think about that "trade". As I watched the metals come way down in price, it made me start looking at things in a different way. Then came 1982. T-bills paid 8% and the DJIA was way below 1,000. "You'd have to be NUTS to buy stocks!" was the common belief. "You can make 8% risk-free!" You know the rest. Sure wish I had some money back then.
Best regards, SM, I appreciate the thoughtful discussion. Sure wish we saw more of it on ET.
