The phantom recovery is finally peaking right about now. Home price declines show the weakness of the housing market:
Why is this good news? It means renters like yours truly get closer to affording a house.
Why is this bad news? It makes existing homeowners more likely to default on their mortgages, thus pushing banks back to the brink of insolvency.
On balance, it's mostly bad news. It's funny how the Dow took this in stride and posted a tiny gain for today. Program traders must be confident their algorithms will keep working as designed.
Nota bene: Anthony J. Alfidi is long puts against IYR at the time this post was published.
The market seems to have pulled the rug out from under housing industry hopes for a sustained early recovery.
After a five-month run-up in home prices starting last spring, prices have now fallen for four consecutive months, according to the S&P/Case-Shiller Home Price Index of 20 cities, a gauge of market values, released Tuesday.
Why is this good news? It means renters like yours truly get closer to affording a house.
Why is this bad news? It makes existing homeowners more likely to default on their mortgages, thus pushing banks back to the brink of insolvency.
On balance, it's mostly bad news. It's funny how the Dow took this in stride and posted a tiny gain for today. Program traders must be confident their algorithms will keep working as designed.
Nota bene: Anthony J. Alfidi is long puts against IYR at the time this post was published.
