Exactly. The business of moving goal posts around to match one's subjectively chosen normative outcome is a disgrace to factual logical positivism.

Housing has its own normal level of employed resources just as labor has already achieved under NAIRU, leaving only normal frictional unemployed resources since cyclical aberrations are always corrected under efficient markets over the long run.

Stupid liberals.

While I don't have a handy source for homeless rates, I do believe that homelessness has increased significantly during the current recession.

And I mean homeless in a broad sense that includes young people, couples and families who have moved to share living quarters with family and friends for an increasingly long temporary lodging.

These people yearn for their own homes but lack the the income and wealth to convert that yearning into economic demand.

The housing crisis presents a great challenge and an opportunity for leadership that our Democratic leadership lacks the insight and fortitude to conquer.

right on. here is some supporting data from one county. from what i can tell, housing prices can go further down, not up.

Estimated median
family and household
income (2010 dollars)
decreased between
1999 and 2010 in
Hennepin County and
its four largest cities.
Hennepin County’s
estimated median
family income
decreased from
$85,554 to $76,797
and estimated household
income decreased
from $67,047 to
$59,236.

It's almost laughable to watch all of these reporters, whom have no knowledge of how overbuilt last decade's housing bubble became, jump in joy at the sight of any positive news regarding the housing market. For starters, a good chunk of the recent positive data on housing is due to the unseasonably warm winter weather. When it's 60 degrees and sunny in mid-Jan. in Va. and N.C., of course builders are going to continue building, which will throw off the seasonals. The other issue is that people seem to forget how much excess supply on the market. At current household formation, destruction, and starts levels, we will not reduce the excess supply of vacant homeowner units until the end of the decade. That's not to say that some regions won't be seeing strong gains by then, but rather that is to say that the national indicators won't be functioning normally, as they did in the 1990s, until then.

Since some economists claim that there is actually a shortage of houses (this has been picked up by Krugman in recent blogs and columns), there is a plausible story according to which there is a fairly rapid recovery of housing and construction - not to bubble levels, but to a reasonable long-term average level. There is no question that the housing market is impeded by foreclosure problems of various kinds. Vacancy levels are high, but how much of this is due to legal problems related to foreclosure? The housing market would certainly move better if there were relief for some of those now underwater. HAMP money for this has not been spent completely.

I repeat that the data on housing starts do not demonstrate massive overbuilding during the 2002-2005 boom - peak building rate was less than in many previous booms:

http://www.skeptometrics.org/HousingStarts.png

If legal problems are preventing foreclosures, then units would be occupied, not vacant. The vacancy rate presents pretty compelling evidence of an enormous over-supply of housing that will not be wished away.

"Since then, as the housing slump has continued to weigh down the larger economy..."

This is the only reference I can find in the article to what Dean claims is evidence the Post has not noticed that there was a housing bubble, and expects home construction and prices to bounce back to bubbly levels. Dean says the article "implies" this is so, which is a good way to get around the fact that the article says nothing of the sort. Dean's typical answers when it is pointed out that he's putting words in reporters typewriters include that his grasp of English is better than that of others and that what he meant (and what any civilized person could have understood that he meant) was that the Post made the errors he claims in some other article, and that we should all know that by combing through his prior writing.

Here's the thing. Dean ostensibly has put himself in the business of pointing out shortcomings in economic reporting. There are lots of those, so he should be able to keep himself busy doing what he claims to be doing, without having to wander off into the weeds. What Dean does in a good many cases is claim that economic reporting is violating one of his pet rules, and then strain very hard to make the case that the rule has been violated, when it has not.

Housing starts and sales remain at very low levels relative to the decades-long period for which we have data. That situation can reasonably be described as a slump, without really caring that there was a bubble in a recent prior period. There is simply not need to pretend that a newspaper, even one as bad as the Post, is doing something wrong when it is not.

kharris- H

Housing is not in a slump. It is in a correction - correcting from a period of unsustainable growth. The only way to correct from unsustainable growth is to slow growth down.

Maybe it's just semantics, or maybe you just prove Sinclair's saw that it's impossible to make people understand something when their salary depends on their not understanding it.

I'm not sure where skeptonomist got his chart, but here's one from the NAHB (http://www.nahb.org/assets/ima...sImage.jpg) that shows the construction industry did indeed follow the bubble up, faltered in 2004, gave it one last gasp until 2006, then gave up the ghost. It's massive enough to notice (like Dean did). But maybe skeptonomist is including commercial building? (which shouldn't be included to make a point about housing)

Vacancy levels are high, marriage rates are down, etc. And it's in large part, if not wholly, due to the conflation of the middle and lower classes into a pool of underpaid, underutilized, under-appreciated proles who continue to achieve productivity gains for the wealthy who are now disinclined to share these gains, and take back some of the previous sharings as well. To imply that this crater in the housing industry is just a 'slump' that we'll get out of takes away from the still very pertinent news that the housing bubble was caused by an overbloated financial sector that sits like a giant tick sucking the blood out of this economy. The extent of the drop shows to which degree the financiers fooled the market (by artificially inflating demand via home equity loans and risky mortgages) into overbuilding with respect to the economically feasible demand. Workers wages have not been keeping pace with the GDP, so of course it's almost impossible for the average joes/josephines to afford all these houses that have been built since Reagan's term. It's a neat trick: give them a loan, decrease their wages slowly overtime. What is a wonder is that this crater isn't even deeper.

So, my vote goes to Dean again, not skeptonomist, though Dean may just be splitting hares (sic), it's what needs to be done. Besides, "give 'em an inch and they'll take a mile."

And I disagree with kharris, who sounds all nice and reasonable, but the fact is that always presenting a crash as a slump is just a way to water down bitter medicine that some portion of the power elite want the common man to take. The worst kind of propaganda is the propaganda that is not even recognized as such.