This week, we have arrived at a tragic milestone in American history. It's the week we're learning, irrefutably, and as the U.S. MSM is now "officially" reporting it in a variety of media outlets, facts many have been pointing out for years: the U.S. housing market--the financial backbone and primary asset of the U.S. middle class--has collapsed to levels significantly worse than the public has been led to believe, to date.
Exacerbating the ongoing, downward trajectory of the primary, major asset of most Americans, our country's (arguably) leading residential real estate expert, Yale University economist Robert Shiller, is now projecting that we're nowhere near bottom of the housing depression, as he now predicts ongoing, "substantial" declines of from 15%-25% in the not-too-distant future (perhaps as early as Spring), as well.
Even some of our nation's leading financial journalists are noting that more than half of all U.S. mortgageholders will be underwater by Spring. Barron's Alan Abelson, is telling us it's: "Worse Than You Ever Dreamed."
In fact, many leading economic pundits -- that's right "many" -- are saying things, at least as far as housing is concerned, are about to get much worse. From the business lead in Wednesday's NY Times: "Home Prices Slid in December in Most U.S. Cities, Index Shows."
Home Prices Slid in December in Most U.S. Cities, Index Shows
By DAVID STREITFELD
NY Times
February 23, 2011
Real estate prices slid in just about every part of the country in December, pushing a housing market that once seemed to be rebounding nearly back to its lowest level since the crash began
At this dismal point, some economists and analysts say that the damage has been done, and there is nowhere to go but up. Many others argue that the market has still not finished falling...
...
...Mr. Shiller, noting the unrest in the Middle East, a large backlog of foreclosed houses, the uncertain future of the mortgage holding companies Fannie Mae and Freddie Mac, and proposals to reduce the mortgage tax deduction, saw “a substantial risk” of declines of “15 percent, 20 percent, 25 percent...”
Alan Abelson writes in the latest edition of Barron's, in "Worse Than You Ever Dreamed..."
Worse Than You Ever Dreamed
Alan Abelson
Barron's Magazine
Saturday, February 19th, 2011
...Please don't tell Wikileaks, if only because they don't know how to keep a secret. It concerns housing. Everyone knows, of course, that it's in the pits. Considerably less well known is just how deep those pits really are. Which explains our squeamishness about the news getting around, as it might temper—and we stress might—the irrational exuberance (the pithy phrase may be Alan Greenspan's most enduring legacy from his many years running the Fed) that has rocketed the stock market to 32-month highs and climbing.
Conceivably, the revelation we're about to share with you could put at least a temporary pall over hopes for the long-awaited and often prematurely heralded housing recovery, and the very last thing we want to do is make investors or plain old civilians unhappy. For most people, their house, be it ever so humble, is their largest single investment. (And all these years we've been suffering under the delusion that a house was, pure and simple, to live in. It came to wear an "investment" label during the wild years of the last decade, when it was viewed as an ATM and an asset that could only appreciate in value.)
As Stephanie Pomboy in her always lively MacroMavens dispatch points out, the acrid aftermath of the big bust in housing has failed to dissipate and adamantly hangs on. The average homeowner with a mortgage, she notes, has a scant 2.6% equity in his house, and the already towering delinquency and foreclosure rates seem headed for a new thrust upward, with interest rates creeping up and jobs remaining anything but easy to come by.
Hardly surprising, then, that demand for mortgages has sagged to a 27-month low, an evil omen for something even vaguely resembling a decent recovery in housing.
What's more, if CoreLogic is right, things are a heck of a lot worse than most of us dreamed...
But, the real truth is thus...
We have known, for many years, as even I have reported it in many posts since 2008, and per the projections of major financial firms such as Barclay's and Deutschebank, that this milestone would be upon us in 2011.
And, once again, as I've also reported it numerous times, and just as "they" did it in September of 2008, our corporate-owned MSM leads us into "Hoocouldanode" territory, as we now witness the veritable cinching of the final phase of the virtually total domination and sellout of our society to Wall Street; all in one fell swoop, and all under the sanctioned blessings of our bought-and-paid-for federal government.
So, once again, please forgive "us" for interrupting your "regularly-scheduled programming." (SEE: "Bill Moyers: America Can't Deal With Reality -- We Must Be Exposed to the Truth, Even If It Hurts.")