ATHELSTAN

Thursday Market Preview: The Bears Are Firmly in Control

I fear more than just a melt down of markets and banks. Now we are facing the strong prospect of a societal paralysis, plunging prices,a rapid increase in business failures, and anarchy manifesting itself in food riots and rebellion. On a scale which will make the 1960s city burnings and lootings appear as a Sunday picnic.

Number of U.S. Homes With Negative Equity Is Stunning

What is even more frightening is that banks can't prevent people from losing their jobs. Which only adds to the burden of trying to negotiate new mortgage terms. The U.S. Government can provide all the incentives to lenders, investors, and borrowers it wants to provide, but until the tidal wave of dismissals is arrested by the Obama administration we won't see any improvement.

In fact, if Dr, Martin Feldstein of Harvard is correct, we are still seeing simply the beginning of the housing crisis.