Record Shadow Housing Inventory, and How Obama May Have Just Popped the Consumer Spending Bubble

While today’s foreclosure settlement deal is by some accounts expected to help the housing market, as the foreclosure pipeline is once again unclogged, it is unclear what this will actually do for price discovery and clearing levels when one considers the already untenable shadow housing inventory, which can be summarized simply as follows – excess supply. It is this overhang that has to clear before there is any hope for incremental demand interest.