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Global Capital Asset Death Spiral

Just because a distress sale yielded $20K does not mean your house next door is worth $20K - you really cannot approximate a line with one data point. And where does this author get the 10% national price reduction? Paulson is correct - there is no national real estate market; just a lot of local markets. Look at Pennsylvania - pretty good. Look at Nevada - horrible. The problem is too many properties are heaped into mortgage pools and no one really knows what is in these pools. Do the groups who bought Merrill's mortgage back securities think they overpaid at $.22 on the dollar?

Have Freddie or Fannie missed any payments or obligations? Isn't this really a liquidity issue that the Fed is trying to keep from being a margin call?

Remember the headlines that 2008 Q2 would be flat or no growth but came in with growth that is not at all recessionary? Maybe a little positive attitude will cause a little more positive real estate market.