National home prices are officially on the hunt for a new bottom... It reports that national home prices now sit 0.7% below their March 2009 low. Over the past nine months, they're down 11.5%.And here's the graph:
Mr. Indiviglio (what a cool name) reminds us that:
...it's important to remember that it's a self-imposed double dip. The home buyer credit essentially prolonged the housing market's agony. Instead of allowing the market to hit its inevitable bottom, the program propped up home buyer demand for a period of time. But once that support was withdrawn, the market continued back down its inevitable path. (emphasis added)Notice the implication for our economy? The stimulus and bailouts may have stalled the economy's downward spiral but it didn't stop it. Once the money starts drying up the economy will begin it's downward path again.