Wednesday, November 11, 2009

Third Quarter existing home sales from NAR show HOUSING IS DEAD!!

The National Association of Realtors reported that median prices of existing homes fell in 123 of 153 metropolitan areas from third quarter '08 to third quarter '09, leaving us with a national median price of $177,900 (down 11.9%), according to an article in the Wall Street Journal today. Distressed and short sales made up 30% of all transactions in the third quarter across the country. The first time homebuyers credit, recently extended by Barack Obama and Congress, is being heavily credited by NAR with the 11.4% rise  in national home sales pictured below:

There can't by any industry in the history of man that has received more tax breaks, stimulus funding,bank  bailouts, federal Treasury and FED buyouts (of mortgages!) than our broken housing/mortgage industry.  Let's just face it: Housing IS DEAD. Say it with me again: Housing IS DEAD! For eight years too long we milked and over-milked and overextended the great CDO/Mortgage Finance/Housing Appreciation Credit Bubble instead of building real jobs and a real economy in America. And now: HOUSING IS DEAD!!.  Applying the shock pads continually to the lifeless Mortgage Finance Economy, watching the corpse jump a bit, then declaring: "Look it still lives!" is just bullshit and all the monies and tax breaks we are pumping into the NOW DEAD HOUSING ECONOMY is wasting our little remaining federal deficit spending capacity and PREVENTING US FROM GROWING JOBS in engineering, finance, technology, research and development. The shadow of George Bush's failed economy still lives.  It is hampering you from any real progress as an executive Mr. President.

I completely agree with efforts to stop foreclosures and keep people in their homes. A braver Barack Obama once talked about federal legislation to exempt primary residences from the bankruptcy process.  At this point, the president and the congress ought to simply declare a blanket moratorium on all all foreclosures and establish a federal board to renegotiate all but the most egregious speculative attempts at foreclosure. Amid nationwide escalating unemployment and foreclosure rates, where does the housing industry think new demand will come from? Some endless pool of new buyers? Recycled buyers cannibalizing the home they are in for investment? Now bankrupt California/New York retirees?  Chinese and Russian REITs? Where? For Rove's sake, Show me the demand , baby! Show me the demand!!

 Why do you think the banks are hoarding all their new found Stimulus funding? For the next big growth phase in the economy? To pass some solvency test? NO, they are gathering and hoarding, waiting for the stimulus funding stop, waiting for the states and cities to dump into a very long winter crisis and then....they are going to hold onto their monies, loaning only to the rich, while small businesses evaporate and hunger invades every family in America.

Mr. President: Stop the spending $$$ on the housing industry bailout now!  In saving this industry, you aren't saving America, you are saving George Bush's fake substitute war-time economy that let us all believe we could keep spending "bubble funds"  while we fought expensive foreign wars.  Stop the war economy now! Rebuild jobs in America instead of propping up a dead housing economy.  If more houses are needed in our still overbuilt, over-supplied, bankrupt economy, then a spate of new jobs and $$$ in the hands of working middle class families will re-establish that demand.

Force local communities to BUILD JOBS, Mr. President.  Think outside the box!  Centralized employment planning has a long history in many countries for many years. Now is the time. Before the plutonomy take ALL OF THE WEALTH they stole from us elsewhere.

1 comment:

Unknown said...

Thanks for the cogent and fun analysis, the problem is and has been the pretend money being dumped into this and other broken systems like this (institutionally megalithic lending systems.. and thus the borrows enslaved behind them).