Bah, another where’s-the-bottom post. Who cares anymore. Bottom ain’t coming for a long long time; you’ll have plenty of warning when things start to pick up again.

I started out thinking this was just a real estate thing, and as time has gone on, realized there are big, deep systemic issues in the U.S. economy. This is way beyond real estate. There is a rather nasty credit crisis going on, banks are writing off billions in mortgage derivatives; this thing is the size of the S&L crisis, if not a good deal bigger. The last run up had none of the systemic changes (e.g. mortgage securitization) fueling it. SIV’s are dead, haven’t you heard?

You have friends hungry for a home? That hunger has a way of dissipating when price appreciation does not appear. Appetite for second homes tends to evaporate when potential buyers reckon on price depreciation.

It will take years for people to forget about wild price appreciation. Declines beget declines just as rises begat rises. Long after will come the bottom.