“People are picking bottoms all the way down, and at some point, prices become so tempting, that a critical mass of people/investors (who no longer need to be “rich”) enter the market and support prices when they reach fundamental levels. ”
Prices have reached fundamental levels versus rent in most of the country but yet they continue to drop. You certainly don’t have to be “rich” to buy a house in Vegas, Phoenix, or for that matter much of San Diego county.
“Not only have they succeeded in dragging this recession/depression out for far more years than necessary,”
Your chief point seems to be that if we would have let the markets crater then we would be doing fine by now. The fact that foreclosures are still piling up and prices are still dropping in smoldering areas like Vegas and Phoenix seems to suggest that you are underestimating the consequences of a complete deflationary debt collapse.
BTW, I am not suggesting that artificially supporting the market was a good idea and I agree that it was largely done to transfer losses to the taxpayer.
Regardless of how the band-aid is taken off, we are going to be dealing with the aftermath of this binge for a long time to come.
