Friday, August 21, 2009

What rebound? Foreclosures continue to rise

Via McClatchy:
Delinquency and foreclosure rates for U.S. mortgages continued to rise in the second quarter, with loans to the most qualified borrowers going bust at an unnerving clip, especially in hard-hit states such as Florida and California.

The numbers reported Thursday by the Mortgage Bankers Association show clearly that rising job losses are worsening the nation's housing troubles and threaten the Obama administration's efforts to keep owners from losing their homes.

The quarterly National Delinquency Survey showed that almost one in 10 homeowners with a mortgage was at least one payment late, and thus delinquent, while another 4 percent had entered the foreclosure process on their loan.
I have previously said that the Obama Administration can point to all kinds of stats that show a "recovery" but there are only a couple of measures that most people will understand:

1. The pay. If salaries are stagnant or falling--people will not believe a recovery is in effect no matter how much the Government claims otherwise.

2. Unemployment. People understand that there are always people who are unemployed, and to be fair unemployment is a difficult standard to fully grasp, but the basic notion of more and more unemployed means that people are losing jobs and not finding new ones--it really is that basic and it tends to stagnate people at their current jobs.

3. Foreclosures. This one is probably new to most people, but in this particular crisis, foreclosures mean that people are losing their homes and that hurts and worries people.

As long as these three factors are mostly negative, most people will not consider the economy in a recovery.

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