> I think you're missing the point here.
I disagree.
> Yes, prices fluctuate greatly even in the presence of a steady
> long-term trend, so long-term trends aren't much use for advising
> the *individual* shelter-seeker on the rent/buy decision.
Good, I'm with you so far.
> But if the question is whether *public policy* should favor homeowning
> or renting, then you *should* use the long-term trend.
Well, that's a (very) different question than we've been discussing:
>> "... if Americans could be persuaded that rent payments aren't
>> "wasted money" and that owning often makes less financial sense than
>> renting ...
... which I'll just stick my neck out and say is only a true statement depending on your definition of "often" ;-)
> Yes, the long-term trend is an abstraction that doesn't correspond to
> any one individual's experience. But it's an average of the
> experiences of all the many individual shelter-seekers over time, and
> since public policy affects all those many variegated shelter-seekers,
> that's the best measure to use to inform the policy choice.
I've always heard that the plural of anecdote is not evidence; if you think that the average of a stream of essentially random numbers has meaning, we have a fundamental disagreement (see "the mean dead rabbit" for details). In the mean time, I think you have it backwards: the policy preceeds the incentives. The policy implication if renting is cheaper than buying is that the incentives aren't high enough.
/jordan