Monday, August 24, 2009
Free market capitalism sat on a wall
... and all the JackHolies are trying to put it back together again with the same glue that knocked it off the wall. -AM)
Rosie via the King Report
As for those who believe that the housing market is stabilizing should have a read of the article Improving Home Sales Belie Market Reality on the front page of the Money & Investing section of the WSJ. The reality is that sales and pricing are currently being distorted by the wave of all-cash deals by investors who are looking to rent out foreclosed units and this wave of competing supply for the apartment market is dragging down rents — a critical driver of the inflation rate — for the first time in 17 years.
According to a survey conducted by the National Association of Realtors, 36% of all sales now involve “nondistressed” properties. And, the article titled Souring Prime Loans Compound Mortgage Woes in today’s WSJ is also worth a read for anyone who believes we are going to see anything closely resembling a normal recovery, and assumes, of course, that the usually wrong consensus is correct that this downturn is completely over and done with. Fully 12.2% of mortgages in 2Q were either in the foreclosure process or in arrears, up from 12.1% in 1Q and 9.0% a year ago.