Credit explosion took me off-guard–I wasn’t looking for the Wile Coyote moment in the CDO markets. Live and learn, I guess.

As for price declines, these seem to be accelerating in the more marginal areas (spectacularly in some), while more affluent/desirable areas are going down ever so slowly by comparison. I was anticipating an initial fall, followed by years of stagnant nominal prices/real price erosion. Clearly the dynamics of the decline are going to vary by region and within regions, with possible false bottoms here and there. Predicting the bottom for a particular area will take careful analysis of local conditions combined with global conditions. In other words, knowing when next to invest in RE will be obvious only in retrospect.