Ben Dover wrote:
I think I know your answers (invest anytime you can for Flag and invest during corrections for Klondike), but I'd still like to hear what Flagpole and Klondike would say to allocating a portion of one's home equity to the market. If you have $200,000 of equity in a $800,000 house, what do you say about using $100,000 of it in the market long-term? Let's assume 5% interest and no other needs for the money (including as emergency funds).
I will argue that this is a sign of the apocalypse (the coming top of the present bubble).
If you go back a few years, using home equity loans and putting the money in the stock market is something that some did around 2006, and it was an indication of excess speculation that led to major tops in both housing and stocks. You know what happened 1-2 years later. Some people are either doing it or thinking about doing it again, at least according to some stories on the web.
NOT a good sign.