The recent equity market flash-crash was determined to be a product of the computer-run systems we rely so heavily on. The flash crash produced a 1000-plus point market drop. And worse, we should expect another flash-crash in the future. With our lives increasingly over-taken by computers, the FLASH CRASH could happen not only on Wall Street, but other part of our lives.
Think of all the elements in our lives run by computers and the possibilities become endless: Blackberry’s, I-pads, I-phones, all telecommunication systems, electrical grids, etc…..the message: In crisis lies opportunity! When the recent FLASH CRASH happened, Apple stock dropped briefly to $ 200.00……it’s trading a few weeks later at $ 260 plus….
And how does this impact real estate? Being a much slower market place, flash crashes in real estate markets seem unlikely, but forms of them do happen. 9/11 caused a 3-month New York real estate FLASH CRASH: anyone who bought in those 3 months had a HUGE advantage….if the Sellers were nervous enough. And some were.
THE MESSAGE: “Don’t panic,” says Leonard Steinberg, managing director of Prudential Douglas Elliman andauthor of the monthly LUXURYLETTER. “We live in a new world. Adjust to these new times so that you do not make quick, rash decisions that could cost you LOTS.”