A home may seem to have some investment advantages, but all of them are artificial, having been created by government: (1) you get a tax break, and (2) prices tend to rise through inflation. But any purchase or investment that the government supports artificially will eventually hurt the intended beneficiaries. Thanks to government subsidies and inflation, the housing market grew disproportionately, and now too many people are stuck in homes they cannot afford. Thanks to government subsidies, too many people own gas-guzzing SUVs weighing over 6000 pounds, the size above which the government offered tax breaks, and now they are stuck with exorbitant gasoline costs. Thanks to government subsidies, some people are now investing in corn to make ethanol. Do you think that gambit will end any better?
~ Robert Prechter, The Elliott Wave Theorist, August 26, 2007
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