Has reality caught up with the juggling clowns?
So much for that “recovery.”
Get this!
“The bond market is going in one direction which is up-falling yields which is telling you quite clearly the direction of economic travel is downwards. Downgrades. QE3 (a third round of quantitative easing) is coming,” said Maughn. “...Once again, the United States will step up as the marginal buyer of bonds, said Maughn.
“One more big injection of cash into the bond market should take you through at least the summer season into the beginning of the fourth quarter...”
“Unexpected”?
“....exacerbated fears about a slowdown in the recovery” What a misrepresentation! There has not been nor will there be a recovery under the Obamunists, as they kill capitalism and liberty, while their toadies trumpet “recovery”.
Welcome to the fall of the empire, hope you make it through everyone. \=}
One of the “bad” numbers of late has been lower “average” market values for houses in a number of areas, with those numbers used to suggest that those lower values, in the particular areas where the decrease is the most, suggest that “something is very ‘wrong’ with the housing market”.
If a normal “housing market” was as far “below” normal as some would like to suggest the current housing market is, then would not homelessness be as equally and drastically higher as well; in fact would not homelessness be rampant nationwide.
But it’s not. So, the lower “market values”, in their seemingly drastic level, are not, in fact, related to a drastic under supply of housing. In fact, they might actually suggest - in terms of how many people are prepared to be the owners of their own primary residence - an over supply of housing, left from the last housing bubble.
So, I have a different theory.
There is not really so much that is fundamentally wrong with the housing market, in terms of it doing what it should.
What was wrong was the false housing market and its mis-allocation of capital between 2003 to 2007, reflected in the housing market bubble. That’s what IS wrong, is the false housing market that led to the current housing market. Yes - mis-allocation of capital; capital seeking unreasonable returns in a false and unsustainable set of values, in the bubble “market values” in housing.
Now, many idiots are blaming a housing market that refuses to behave that way again as the problem of an economy still not growing robustly, if at all.
Well, G-d forbid a housing bubble “rescue” the economy again.
We need capital allocated to industrial and commercial business growth, not “housing” and we need that kind of capital allocation FIRST, BEFORE “housing”.
Then we will have jobs FIRST, people in jobs FIRST, people earning incomes FIRST, people saving FIRST, people accumulating the sum of a decent down payment before they tell the housing industry they’re looking - FIRST.
Then we need those people buying their first home on the scale of “what they need now” and not “what they’d REALLY love to have some day”, so that demand becomes more centered on “affordable” housing, and affordable mortgage payments, keeping the interests of builders in producing such housing more than producing housing market bubble chasing McMansions.
Then we will start to develop a sustainable housing market that reflects and is derived from a more stable employment outlook, instead of a housing market that pretends to be the “driver” of those things; which it can only do temporarily and only as a bubble, whether local, regional or national.
An economy “led” by housing represents an economy where the tail is wagging the dog. It cannot last. Housing, as a market, must be built on an economy that is built on everything else, so that the jobs, income and savings are there to support “housing”.