stock your shelter willis

From Party for Socialism and Liberation (i know, i read news from crazy sites like that, but you get the other side of the story.)

Walking or driving through many neighborhoods these days, one can’t help but notice the many signs advertising houses and condominiums for sale. The rate at which homes have been selling has actually been declining for many months and is now 10 percent lower than a year ago. So, why all the "For Sale" signs?

The reason is that supply is outpacing demand in the real estate market. The supply of houses and condos coming onto the market is expanding as the financial squeeze many people are experiencing—and sizable gains on paper that others hope to realize—are causing a rush to "cash out."

...

Despite this shift in supply and "effective demand," sellers have been reluctant to lower their prices, and so the inventory of unsold homes has risen to a record level. Despite the reluctance to cut prices, "Price Reduced" tags attached to "For Sale" signs are increasingly common, reflecting the "buyers market" that has developed.

...

Merrill Lynch and Charles Schwab, two major brokerages, have recently issued reports to their customers pointing to such signs and advising caution.

Merrill Lynch, for example, made available the chart below, which shows a close correlation in the past 10 years between the outlook for housing construction and sales and the S&P 500 stock index 12 months later. The housing market index is based on surveys of homebuilders by the National Association of Homebuilders.

read the full article here