Liquidity Traps
Chance That the Unemployment Rate Is Above 9% in November 2012 Is Now 60%

Our View of the Golden Gate and San Francisco This Morning...

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With the imminent departure of the Youngest Child for college, we have sold our five-acre Mediterranean palazzino in Lafayette--the land beyond the tunnel--and are renting a small house for six months in Berkeley at the top of Grizzly Peak (because I was hinky about running the risk of owning two houses in a largely-frozen yet still overpriced housing market).

So now we have a comfortable hunk of change to serve as a down payment on our next: over 15 years 30% cumulative inflation, 20% real house price appreciation, 30% improvements that our buyers were willing to pay for, and 40% forced savings via amortization of the nominal principal do add up. Where should we buy next>