There are a number of takeaways here. Business ownership drives wealth creation because it creates an income producing and appreciating asset, aka a productive asset. The primary residence, or real estate provides a place to live, stability and access to schools for those with children. Long term price appreciation for residences has historically been inflation +1% per year or about 4% in total. Further it is not an income producing or productive asset unless bought for investment and rental purposes and the rents received exceed the expenses incurred. Highly leveraged, or debt based speculation on one’s primary residence, that produces little if any income requires someone else to assume even more debt or leverage to be successful, because that is the only way to sell it. At some point the leverage ratios become so high the process collapses under its own weight, this is what happened during the 2008-2009 financial crisis, aka the catastrophic failure of the greater fool theory. As is usually the result with excessive leverage, aka debt, bankruptcy and foreclosure followed in mass.
Registered Investment Adviser
216E Mount Hermon Road
Scotts Valley, CA 95066
Local: (831) 334-5318
After nearly 19 years of live radio it was time to move on to new projects. My daily economic update was changed to a video format in 2019 and moved to my Business Face Book Page. Or you can call my office 831-334-5318 and take advantage of my still “free” after 20+ years initial consultation. Usually about an hour, will have an opportunity to get to know each other better and address your specific concerns on a one to one basis.