If that dow falters again, it will spook the home buyers as well. You’ll have a bunch of fence sitting strategic walkers jump off. You’ll have a surge of unemployment(which really has not decreased that much) leading to more defaults and so on.
It will happen eventually because the main driver for all the problems is the credit contraction. Which is still in full force and getting worse. Which is driven by default rates. Which are still trending up.
See Rt.66 post above by Meredith Whitney regarding credit.
