Situation in the real estate market... madness

The ECB is leading the currency into an even bigger crisis with each year of its existence. The Euro should have been dismantled already during the Greek crisis. Now we all have to suffer the consequences of a failed construct by some powerful men, and I HOPE it remains peaceful in Europe nonetheless.

In the medium term, we will see negative interest rates ranging from -3 to -7%. Also on private assets starting from the first euro. What this will do to the real estate bubble is better left to the imagination...

I have many opinions on this topic in very different directions. Where should I even start?

Well, what happens in the next 5, 10, 20 years is completely unclear. I consider -4% interest rates very unlikely because the ECB, together with politics, can create new financial instruments that intervene correctively in all directions. That is after all their central task: to fix everything that the free market cannot manage on its own. Currently, the bankruptcy of several Euro countries is being prevented. That is very social.

And what is wrong with money becoming so "cheap" that everyone can get as much money as they want? With a -4% key interest rate, one might even get a consumer loan at -1%. Very left-wing and provocative statement, but what is wrong with that? For once, people who have nothing yet receive negative interest rates as a gift. A taxation of the rich. I always find it very amusing how in talk shows, at regulars' tables or even here, an almost fundamental right to returns is expected.

One thing I am very sure of: There will be no mega crisis in the coming years. Neither the Euro, nor Volkswagen, nor Germany as a business location will perish.

Well, then we can all be glad to have built a house now and to refinance at -3% "in the medium term."

For once, people who have nothing yet are being given negative interest rates as a gift. A taxation of the rich.

If only it were that simple.

People who have little are enticed to become increasingly dependent and to consume more.
Many praise the principle that the market regulates prices and forget that the market does not guarantee participation. People who have nothing still have nothing. They do not participate in the market.

A "rich" person does not live from income through work but from profits from investments and transactions. The low interest rate fits perfectly into the financial cards here – as long as they are not foolish (and this form of "foolishness" is rare among the rich).

A middle-class person who lives from their work loses in this game or turns to the capital market with what is left.

The famous "gap" simply widens faster.

The situation on the real estate market shows this madness. – The thread title is already quite fitting.

Yes, if the world chooses this path, it will become very exciting. The modern version of serfdom. Inflation will reach unprecedented levels and money will lose its significance for the private sector, serving only as an addictive drug for the new, broad lower class. A material parallel currency is very likely, as is the rift among the states of the Eurozone. After that, we will be politically back to the level of the early 20th century. I always enjoy painting such apocalyptic pictures very much.

If you take this further, all retirement provisions, etc. also no longer work, because they are designed for long terms with the highest possible returns. The pension of the common man is thus in acute danger. Private provision under this aspect is actually pointless.

I consider an interest rate increase very unlikely. That’s why we already chose only a 10-year fixed interest rate in 2017.

Personally, I consider a break-up of the euro... Mhhhhh, I’ll just say unfortunate. Just like a break-up of the EU. Both actually ensure peace.
We just have to make sure that either the truly poor countries of the EU are not left behind. So really create a community of solidarity.
Or get rid of the unwilling ones. Then equip the EU with genuine democracy and allow majority decisions. The states must therefore give up sovereignty. Then it will become a truly tight federation of states.