Keyboard worrier

Monday, July 09, 2007

How far to fall? iTulip on the Dow and house prices

iTulip shows charts that follow the Dow and house prices, comparing them with inflation over a long period. The implication of the way this information is presented, is that stocks are about 100% over trend, or to put it another way, have a 50% fall to get to the trend line, and house prices would have maybe a third to lose.

I would guess that in terms of crystallising loss, this is more significant for equities than for real property, because you have to live somewhere.

3 comments:

Anonymous said...

I am the author of the charts referenced above. For the latest, see here:
http://homepage.mac.com/ttsmyf/RD_RJShomes_PSav.html
http://homepage.mac.com/ttsmyf/recDJIAtoRD.html
http://homepage.mac.com/ttsmyf/newestHousData.gif
FYI, thru today 7/12 for the Real Dow, and thru 2007 Q1 (= mid-Feb 2007) for Real Homes:
Real Dow is 2.24x the +1.64 %/yr curve, which is a 55% drop thereto, and
Real Homes national (green points) is 1.78x the ca. 54 level, which is a 44% drop thereto.

Sackerson said...

Many thanks. I shall also paste your comment into a new post.

Ed said...

sackerson,
OK, and feel free to use any of my charts at your site.
Ed