Over the next five years, market watchers predict home prices could go up 4% each year. Mark W. Boyer, the chief executive officer of Foundation Financial Group, notes that Jacksonville is not coming back as fast as south Florida, but the housing market did not fall as far. We’re looking at a fairly stable environment right now. There is not a huge increase, but what we are seeing is purchase increase and inventory shrink which is first stage in price increase. According to Boyer, a lot of buyers are opting for the 15- year-mortgages instead of the 30-year-mortgage because they are feeling more confidence in the market.

We had a major confirmation today. All the trades based on predictability are broken. We saw that in the the currency markets today. The Yen Euro carry trade was broken. In terms of derivatives they are geometrically leveraged with little collateral security. If we trace back what happened with GS and AIG that was the first derivatives bailout. With sovereign risk we are facing the second wave of derivative exposure. We will either see default or cooperation. If cooperation comes in a re-valuation of the dollar it will not be as most people expect. The trend is YEN Euro towards parity, then a reset of obligations leaving China as bag-holder along with oil suppliers.