Trump won't STFU, he's not going to change, he has no idea what he's doing. And Mnuchin's comments were a perfect example of a clueless administration.
I agree that this medicine is needed, as long as we're keeping an eye on things. Real estate has fallen off the table in important areas, and as you point out above, business capex may tail off. Plus we have this guy in the White House. We just have to keep our hands on the freakin' wheel here.
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I agree.
But again, the rise in real estate was induced in part, though not entirely, by the Fed and their ridiculously low interest rates. Oddly, we have a very bifurcated real estate market. We have too many upper end homes and not enough on the lower end. If you look at NAHB data, there's roughly 7 months of supply, slightly above the long-term average of ~6 months. But at the upper end, there's 9 months of supply and at the lower end, there's 3 months. All the homebuilders have been focusing on the upper end because they can make profits there but can't make a dime on the lower end because of increasing costs and regulations. And the silly prices are in certain metro areas. Where I live, home prices haven't gone crazy. But they have in other parts of the state.
There's also too much retail space and too many restaurants. Some of that supply is going to have to be wiped out.
