The decline in residential real estate accelerated though the end of 2007, and home prices in 20 key markets plunged 9.1% for the year, according to a survey released Tuesday.So lets examine our current economy. We have rising inflation, a dollar with the lowest value ever against the Euro, rising unemployment and we are tipping into a recession. How can things get worse? The problem is that I think we are just beginning to feel the pain.
The S&P Case/Shiller Home Price index showed its largest annual drop in its 20-year history. By comparison, during the 1990-91 recession, home prices fell 2.8%.
Prices dropped faster throughout 2007 with the index recording a 9.1% year-over-year drop in December.
"We reached a somber year-end for the housing market in 2007," said Robert Shiller, Chief Economist at MacroMarkets LLC and co-founder of the index, in a statement. "Home prices across the nation and in most metro areas are significantly lower than where they were a year ago."
All metro areas are now reporting at least four consecutive monthly declines.
How did we get here? This is what happens when we allow corporations to write public policy. Unless and until we overhaul our campaign finance system this type of economic upheaval will become constant. In a global economy where these companies can still generate huge profits, the future of the American people is meaningless. Until we all accept that as fact and act to change this corrupt system our economic future will be in jeopardy.