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Continuing On The Edge
And here is some more news about the US that should be putting people's teeth on edge....
Yesterday's release of the
Case/Schiller Index of the 20 largest cities in the country,
shows that housing prices have slipped 10.7 per cent in the last
year while sales were down 23 per cent year over year. That means
that retail equity of US homes just took a $2 trillion haircut.
Still, prices have a long way to go before they catch up to the
50 percent decline in sales from the peak in 2005. From this
point on, prices should fall and fall fast; following a trajectory
as steep as sales. Many economists expect housing prices to drop
at least 30 per cent, which means that $6 trillion will be shaved
from aggregate home equity. In a slumping market, many homeowners
will be better off just "walking away" from their mortgage
instead of making payments on an asset of steadily decreasing
value. Who wants to make monthly payments on a $500,000 mortgage
when the current value of the house is $350,000? It's easier
to pack the kids and vamoose then waste a lifetime as a mortgage
slave. Besides, the Bush administration has no interest in helping
the little guy stay out of foreclosure. It's a joke. All of the
rescue plans are designed with just one purpose in mind; to save
Wall Street and the banking establishment. Get into the bunker and make sure you have lots of supplies! And at the same time I am reading stories that based on Cheney's recent visit there, the Saudi's are starting to do nuclear fallout exercises.
Keywords:
economics
Technorati Tags:
economics
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