What a move in housing this year. $XHB has doubled . Three sectors I never trade are autos, airlines and housing. Truth be told I didn’t buy into the move and that was my bad. I should have paid more attention.
I mentioned on Stocktwits last night that “housing is improving not because rates are low, but because rates are going higher.” It’s human nature to want what you cant have or to grab furiously at what might be getting taken away. People are seeing rates inch up and while many were waiting to pick the bottom on rates, now see that opportunity slipping away. They read about the bond bubble popping and rates going even higher. At the end of the day the free market will set rates, not Bernanke.
Yes I know banks aren’t lending to holograms and cadavers like they were six or seven years ago, and that may never happen again, but you know they will find a way to play in the sandbox of the next great bubble that has already started.
So maybe the doorman at the Ritz Carlton won’t own three properties at once anymore, but banks are great enablers if they want to be, and they will find a way.
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