Over the past several years, it is fact that the main source of Western wealth has been the various housing bubbles observed in almost every country. With reduced manufacturing jobs and falling wages, homeowners withdrew home equity to maintain and even raise their lifestyles. From the two charts below, these bubbles have clearly peaked and are just starting their cliff diving. Now not only has this false source of wealth been eliminated but it is now time to pay back the recklessness – kind of a double whammy of sorts.

So much has the West relied on real estate for prosperity that deflation of these bubbles is now causing financial markets to shudder. So even though the media spin doctors have recently touted that the capital crunch is behind us, intelligent ones must surmise as to what caused the capital crunch in the first place? Yes folks, if we can all remember through the media clouds, it was failed mortgages that sparked the chaos. And by the charts below, has the mortgage based root cause of the credit crunch been cured? Not a chance and it will only significantly worsen. The central banks can huff and puff all they want but the system will be going down with the bubbles.

By suppressing gold and silver prices, the coil only gets that much tighter for a major upward move. The timing of this move is the only question left and most of that is behind us already.

Hang in - VHF

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As S&P makes perfectly clear for a change...

“There is no sign of a bottom in the numbers,” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor's. “Prices of single family homes continue to drop across the nation. All 20 metro areas were in the red for the February-over-January reading. In addition, 19 of the 20 MSAs are still reporting negative annual returns. The monthly data show that every one of the MSAs has now declined every month since September 2007, marking six consecutive months. On top of that, the declines have remained steep with eight of the 20 MSAs and both composites reporting their single largest monthly decline in February.”