No. of Recommendations: 5
Valuemongeragain wrote "The big risk is how much the recurring payments are in real purchasing power and how much the principal will be worth at maturity again in purchasing power. "Also..."CPI has averaged about 2.1% for the last four years."

One of my points...how do you define real purchasing power? Has your cost of living only went up by 2.1%/year for the last four years? I would be jumping up and down with relief if my cost of living had only increased by that amount. Your purchasing power is been further reduced by the difference between "street inflation" and the government telling you inflation is only 2.1%. The increases in replacement cost of real estate is probably close to the inflation we as consumers experience in our daily lives. The low interest rates(financial repression) relative to even the government's number for inflation and even more so relative to increases in replacement cost has been a tremendous tail wind for real estate values.

Does this discrepancy continue or become even more extreme and create a larger tail wind for real estate values? I.E. do we have a risk of a bubble?
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