Here is what concerns me about the current market.    Although the VALUE of homes in the Austin area (in recent months) have stabilized compared to DOLLARS, their actual value compared to other commodities are going down.  A dollar buys less now due to its weakening value across the globe.  The real culprit here is the U.S. Government printing money in an attempt to prop up the economy.  The result is what some call  “invisible inflation” because most people compare there home value to its value in  U.S. dollars.  In other words, I bought my home for $200,000 10 years ago and it is now worth $210,000.     Unfortunately, there are now billions more dollars chasing the same amount of goods in our economy.  As more money floods the economy it artificially cause stock markets and lending to increase, and real estate prices to stabilize and perhaps even rise simply because there is more money out there to spend!   Unfortunately, this is an illusion of a rising economy. The vast majority of folks are used to comparing the value of stocks and real estate to  U.S. Dollars.  However, when you compare the value of your home to gallons of oil or pounds of sugar it clearly shows that value of your home is actually going down.  Our economy is reaching a tipping point of currency devaluation.  In fact our governments monetary policy is reckless (by any standard) and has the potential of causing excessive inflation.   If this occurs the worst thing to own will be CASH!  Cash is not king in this economy. Cash is your enemy right now.  So what do you do?

1. Get out of the stock market as fast as you can.  Do no buy into the lie of invest for the long term, because the stock market always rises!  That is a formula that no longer applies.

2. Invest in under valued commodities and investment real estate.  (note: Real Estate can cash flow, commodities cannot)

3. Get into good debt situations like cash flow rental real estate ( You can buy loans at today’s dollar value and pay it back at tomorrows dollar value).

4. Refinance your home if you can t lock into today’s low rates and leverage your money.

5. Move-up to a larger home and compound your gains proportionally.  e.g. a $300,000 homes value is about $30 lower than 2 years ago, while a $200,000 home is only $20,000 lower than 2 years ago.