[NVDave]

This is actually good. It hurts, but it is necessary.

If we accept the data that there was no organic household earnings increases in the ‘00’s and that consumers spent debt, not income, then we need to basically unwind the housing asset class to pre-2001 levels, when the Fed started to inject money into the economy at absurd levels.

[Rational Thought]

If your a homeowner, I can't see anything good about this. The wealth (assets) of the average homeowner has been destroyed (reduced equity).

Now for the really good news. In numerous areas I've looked at, home prices are now at levels of the early 90’s. In addition, with even tougher mortgage guidelines about to take effect, values are going to continue going lower, leading to even more foreclosures. Also being destroyed are all the business's and people who used to make their livings on Real Estate sales.

Now, to those who aren't homeowners and feel it won't effect them, these lender loses will likely be covered by more tax payer dollars.

If anyone thinks our economy can improve without replacing this component, they are mistaken.

[Nervous Tick]

>> This is actually good. It hurts, but it is necessary.

YES.