Good morning! Yesterday the stock market got pounded, and today brings even more nauseating news. Nationwide, home prices are tumbling and even Robert Shiller, co-creator of the Shiller-Home Index (which released its numbers today) has no idea where we're headed. Here's his interview yesterday with Reuters television: 'It's hard to predict this market because we've just been through the biggest bubble in history and it's at the time of the worst financial crisis since the Great Depression." And he says the month to month declines "have a good chance of continuing." The tumbling of home prices perhaps wouldn't seem so bad, but couple those statistics with today's just-released Consumer Confidence Index, which monitors how consumers are feeling. Consumers reported feeling a low 25--that's basically the flu. More via the Associated Press: "The index, which had hovered in the high 30s over the past few months, broke new lows since it began in 1967. A year ago, the consumer confidence reading stood at 76.4." Yes, the time seems about right for that economy-fixing "Emergency Christmas" suggested by the Daily Show's John Hodgman. And as for those specific S&P/Case-Shiller Home Price numbers: Home prices are now down 27% from peaks in mid-2006, according to the Wall Street Journal. Phoenix, San Francisco, and Miami saw some of the biggest drops, according to the Los Angeles Times, which reports those cities are down more than 40% from market peaks, while Los Angeles-area home prices dropped 37% from a 2006 peak.
Home Prices Fall; Crabby Consumers Staying in Bed
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