Standing inventory tells a story, but the number of REOs and short sale listings in that standing inventory would tell a more important story.

2300+ NODs for August could translate out to 1400 foreclosures by December. Even if the number of foreclosures were to plateau (which basically can’t happen at this point), think about what a 1400/month REO rate does to a 2200/month avg rate of sales.

For the period during which we’re adding 1400 foreclosures to the standing inventory every month it almost doesn’t matter what the other 20,000 listings do. That number could drop to 5,000 listings – not that it will – and it still wouldn’t matter because the REOs all have to be sold for whatever the market will bear at that time, regardless of the losses involved.

For those couple of you who can’t see this happening right in front of your eyes I can only express my profound condolences. It’s people like you who are surprised when the train that’s coming down the track you’re standing on hits you.