They have it right, CRE is still being held on the books 20-40% higher than what it will sell for and lots of subleasing going on keeping lease rates low. CBG is currently one of my favorite shorts.
The fed saved the world's ass. And it will inflate the debt away in the coming years. Only retired boomers will sufer, who will be against that? Just because the fed keeps rates low doesn't mean YOU HAVE TO buy an overly priced house with a 40-50 year mortgage with payments that eat 3/4 of your monthly income. It is PEOPLE that are the problem.
What if the US dollar loses value... inflation occurs.. and we have less purchasing power for staples such as bread, corn, etc. (simultaneously as commodities get more expensive)? People don't have to buy a house in a real-estate boom, but they sure as hell need to feed themselves. And don't forget the inverse correlation between oil and the US dollar. That's something necessary for the economy.
I'll make a bet right now: Inflation will be less than expected. (expectations are way too high...) I know that printing money should result in inflation, according to the quantitative theory of money formula: V*M = P*Q. Meaning if you parachute money to everybody, the economy cannot instantly ajust and thus only prices will rise. That is IF the economy already runs at full speed. Its is not right now. There is lot of underutilised facilities out there, lot of unemployed workers. The credit crunch primarily destroyed money, so printing money back *could* not necesserily result in inflation. I admit we are in unchartered territory here. But i thrust Bernanke knows what he is doing. Long term though, the government does have an incentive to inflate away his debt. But it does not have to be brutal. A mere 3-4% inflation instead of the 1-2% we were used to can do wonders to a debt/GDP ratio. As for agricultures, in the past 4000 years, prices tend to rise sharply short-term, which draw in a lot of new farmers, supply adjust, prices fall of a clift, new farmers are starving and turn to the government for help... I have faith in that time-serie.