A revered Spanish novelist once wrote: "Take care, your worship, those things over there are not giants but windmills."
Well, there seem to be a few giant problems on the horizon! Real estate difficulties, stagflation, current account imbalances and sub prime problems to name but a few. Some predictions for the future of house prices and equity values are downright ugly and that made me think of Sancho Panza’s warning to Don Quixote – we sometimes run scared of the benign. Sure, the real estate boom is over. Its demise started in the US and is now spreading to other boom areas such as Ireland, Spain and the UK. Supply-side problems in UK housing will help to support domestic values. Nevertheless, UK hous...
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