14
03/10
From the Sunday Papers: “IT’s a great time to buy a home.” – Finally Someone Takes the NAR to the Woodshed
by John Galt
March 14, 2010
WOW.
The New York Times finally talked to someone who knows what the hell they are talking about in the person of one Barry Ritholtz who spells the problem out in black and white for the sheeple in this article:
Great Time to Buy (Famous Last Words)
Where the first sentence says it all:
“IT’S a great time to buy a home.”
Read it. Understand why it raises my skepticism level to new heights with regards to any alleged recovery. If the national average for home prices drops the needed 15%, then in the hard hit states like Arizona, California, Florida and Nevada we have another 30-35% to go. I think Barry hits it spot on and if we allow for the deleveraging to occur at full speed a 30%+ drop in home prices is not only healthy for states like Florida but necessary. This means the great unwashed idiots who have escaped the first severe wave will now begin to understand what has been happening in the remainder of the nation and why the pain, while difficult, is necessary. The challenge will be to see if our political leadership can accept eight quarters of negative GDP numbers to insure the system cleanses itself without hyperinflating to save their sorry butts.
My money is on “no” and they will institute desperflation.
God help us when that begins.
