The Next U.S. Housing Crisis Has Arrived: Existing Home Sales Post Their Biggest Decline In 4 Years

Things just continue to get even worse for the U.S. housing industry.  New homes sales have been absolutely plummeting, homebuilder stocks have lost over a third of their value, and existing home sales just posted their biggest decline since 2014.  For years, we had been witnessing a real estate boom in the United States, but now that has officially ended.  It is starting to feel like 2008 all over again, and many of those that work in the industry are really starting to freak out.  The Federal Reserve has been aggressively raising interest rates, and it is having the exact same effect on the housing industry that it did just before the last recession. (Read More...)

Housing Crash?: U.S. Existing Home Sales Fall By The Most In Six Years

Home For Sale - Public DomainWe just got more evidence that a major economic slowdown is underway here in the United States.  Existing home sales were down a whopping 7.1 percent during the month of February, and this represented the biggest decline that we have seen in six years.  This is yet another sign that we are in the early stages of a new crisis that is eerily reminiscent of what happened back in 2008.  The truth is that most U.S. consumers are tapped out, and when you are tapped out it is really hard to get a mortgage.  Banks aren’t really fond of lending money to people that can’t pay it back, and in recent years housing prices in many areas have risen to levels that are beyond the reach of most middle class families. (Read More...)

It Is Time To Kick Prepping Into Overdrive, Because This Stock Market Crash Is Just The Beginning

Speedometer - Public DomainIf you have not been preparing for what is coming, you need to get off your sofa and you need to start prepping right now.  Just remember what happened back in 2008.  That crisis took most people totally by surprise.  Millions of Americans lost their jobs, and because most of them were living paycheck to paycheck, all of a sudden most of them couldn’t pay the rent or the mortgage either.  Large numbers of families that were once living a comfortable middle class lifestyle suddenly found themselves destitute.  Well, this coming crisis is going to be even worse by the time it is all said and done, and it is not just going to be economic in nature.  Over the past two trading days, the Dow has gone down more than a thousand points.  The shaking that so many have warned about has begun.  As this shaking plays out, you and your family will need cash, food, supplies and a whole bunch of other things.  If you do not already have everything prepared, then you need to kick your prepping into overdrive because we are on a very compressed time frame now. (Read More...)

If The American Dream Is To Own A Home, Then It Hasn’t Been In Worse Shape Since 1967

Home House For Sale Mortgage MortgagesThanks to the “Obama recovery”, the rate of homeownership in the United States has fallen to the lowest level in 48 years.  The percentage of Americans that own a home is widely considered to be a key indicator of the health of the middle class, and we have just learned that during the second quarter of 2015 that number dropped from 63.7 percent to 63.4 percent.  It is now the lowest that it has been since 1967.  Unlike a lot of other government economic statistics, this one is fairly difficult to manipulate.  Either someone owns a home or they do not.  And what the homeownership rate is telling us is that the percentage of Americans that can qualify for a mortgage has been falling dramatically.  Just take a look at the following chart.  This is not just a decline – this is a complete and utter collapse… (Read More...)

The Banks Show No Mercy: 10 Foreclosure Horror Stories That Will Blow Your Mind

The Banks Show No Mercy: 10 Foreclosure Horror Stories That Will Blow Your MindDuring the last housing crash, the big banks begged the federal government for help and they received it, but when average Americans ask the big banks for help most of the time the banks show no mercy whatsoever.  If you fall behind on your mortgage payments, the big banks have shown that they are willing to be absolutely ruthless.  They will change locks in the middle of the night, they will toss disabled veterans and families with children out into the street in the middle of winter, and sometimes once the foreclosure process has begun they will not even allow someone to come forward and offer to pay off the loan if they think that they can make more money by selling the home.  The big banks will often string homeowners along for months or even years with loan modification promises, only to drop the hammer on them at the most inopportune time.  Over the past several years there has been case after case where mortgage documents have “disappeared”, where big banks have “manufactured” missing documents out of thin air and there have even been cases where big banks have tried to foreclose on homes that do not even have a mortgage.  Once in a while, the big banks get a small slap on the wrist, but nobody ever really gets into much trouble for any of this.  In fact, the big banks just continue to gain even more market share and even more power.  Hopefully when some of these foreclosure horror stories start to become publicized more widely we will start to see some real changes in the marketplace. (Read More...)

The Last Housing Crash Is Not Even Over But Bernanke Is Already Setting The Stage For The Next One

Federal Reserve Chairman Ben Bernanke is determined to push mortgage rates to record low levels and he is encouraging the banks that the Fed regulates to make home loans more freely.  Wait a second – isn’t that exactly what caused the last housing bubble?  After 9/11, the Federal Reserve slashed interest rates and this caused mortgage rates to steadily fall.  Financial institutions were urged to help “expand home ownership” in America, and many of them started making home loans to people who never, ever should have gotten home loans.  When mortgage rates started to go back up, millions of families with adjustable rate mortgages discovered that they could not make their monthly payments.  Mortgage delinquencies absolutely soared and large numbers of mortgage-backed securities suddenly turned into garbage.  So what is the Fed doing about it?  The Fed recently announced another round of quantitative easing in which it will buy 40 billion dollars worth of these mortgage-backed securities a month.  Essentially the Fed is clearing the bad financial paper out of the system and is creating the conditions for another housing bubble.  But will we really fix our problems by going back and doing the same things that got us into trouble in the first place? (Read More...)

10 Shocking Quotes About What QE3 Is Going To Do To America

Ready or not, QE3 is here, and the long-term effects of this reckless money printing by the Federal Reserve are going to be absolutely nightmarish.  The Federal Reserve is hoping that buying $40 billion worth of mortgage-backed securities per month will spur more lending and more economic activity.  But that didn’t happen with either QE1 or QE2.  Both times the banks just sat on most of the extra money.  As I pointed out the other day, U.S. banks are already sitting on $1.6 trillion in excess reserves.  So will pumping them up with more cash suddenly make them decide to start lending?  Of course not.  In addition, QE3 is not likely to produce many additional jobs.  As I showed in a previous article, the employment level did not jump up as a result of either QE1 or QE2.  So why will this time be different?  But what did happen under both QE1 and QE2 is that a lot of the money ended up pumping up the financial markets.  So once again we should see stock prices go up (at least in the short-term) and commodities such as gold, silver, food and oil should also rise.  But that also means that average American families will be paying more for the basic necessities that they buy on a regular basis.  The most dangerous aspect of QE3, however, is what it is going to do to the U.S. dollar.  Most of the rest of the world uses the U.S. dollar to conduct international trade, and by choosing to recklessly print money Ben Bernanke is severely damaging international confidence in our currency.  If at some point the rest of the world rejects the dollar and no longer wants to use it as a reserve currency we are going to be facing a crisis unlike anything we have ever seen before.  The real debate about QE3 should not be about whether or not it will help the economy a little bit in the short-term.  Rather, everyone should be talking about the long-term implications and about how QE3 is going to accelerate the destruction of the dollar. (Read More...)