Smooth Move Buying All Those McMansions, America
The weirdest thing in the whole entire USA Today "economic reporting as well as stories about angels" newspaper today was this alleged propaganda piece about how Americans just keep getting more and more pessimistic about the economy. What's the major malfunction, Americans? Unhappy about the virtually assured prospect of several more relentlessly awful years of your home not gaining value as you foolishly expected, extending the fearsome "lost decade" unto, it seems, infinity? Well I guess that makes sense.
Home prices are expected to drop 2.5% this year and rise just 1.1% annually through 2015, according to a recent survey of more than 100 economists to be released Wednesday. Prices have already fallen 31.6% from their 2005 peak, as measured by the Standard & Poor's Case-Shiller 20-city index.
If the economists' forecast is accurate, it means housing faces a lost decade in which home prices recover just a fraction of what was lost between 2005 and 2015, leaving millions of homeowners with little, if any, equity in their homes.
The problem is that people lose value in their homes and then they feel poorer and then they stop with their normally incessant "consumer spending" and that sends the whole damn economy spiraling down into hell, and next thing you know you wake up and it's 2011 already and you spent the last ten years just desperately treading water and now you look around and your home is underwater and the Fed is buying Treasuries and the banks are all getting downgraded and none of it can really do jack shit to help the fundamental fact: you paid too much for your house and now you're broke and your house isn't worth shit. I guess that's why you're all so depressed. Pretty logical, actually.
Hey, at least you still have a house (that isn't worth shit).