With almost certainty we will see a major political shift after next week’s  elections. The presidency will be stuck in a potential gridlock where the only window of opportunity is 2011 says Nouriel Roubini in to-day’s Financial Times. The president deserves credit for setting up a bipartisan debt commission, which is most likely to propose a sensible combination of entitlement spending cuts and increases in taxes. But sadly the chance that these recommendations will be implemented in 2011 is close to zero: Republicans will veto any tax increase, while Democrats will resist unpopular entitlement reform. Again, Washington politicians serving their own interests of power and not the well being of the country. The TEA PARTY is not the Third party this country needs after all…..the THIRD PARTY needed is the one that can unlock gridlock and side with the party that makes the most sense for the country, trimming it’s excesses and de-radicalizing its agenda….an intelligent party …….GO BLOOMBERG!

So we see LOTS OF GRIDLOCK over the next 2 years, a protracted Halloween if you like. And how will this affect New York real estate?

“New York’s high end real estate is fueled primarily by Wall Street,” says Leonard Steinberg, managing director of Prudential Douglas Elliman and publisher of LUXURYLETTER. “Wall Street goes where the money is, and if growth is not in the USA, it will put its money where it can make the most money. There are many other parts of the world where growth and success are huge, and US investors and companies have their hands in all of this.  Remember corporations and private equity are sitting on over 2 Trillion dollars of cash right now. Wall Street likes certainty, and its almost certain not much is going to change in Washington for the next 2 years. We think this will keep the markets stable: they will not soar upwards, nor dip downwards. Some areas of inventory shortage may rise more than others though: that is happening already.”