Shocking CNBC Headline: "Home Price Double Dip Begins"

Diana Olick, by far the best reporter at CNBC, and not merely an anchored regurgitator of propaganda bullet points, let one slip today, by posting an article on CNBC titled: "Home Price Double Dip Begins" (and we have a screenshot in case CNBC realizes the grave error it has made and retracts it). While nothing new to Zero Hedge readers, where we have been making the case that the economy has nothing to double dip to, considering it has been in one depression for 33 months now, it may catch the broader public by surprise. Ms. Olick's arguments: "given the combination of the expiration of the
home buyer tax credit and the increasing number of loans moving to final
foreclosure, we knew that home prices overall would take a hit, but it
would take a while. Well we're here." And there you have it - there is little that can and should be added when dealing with the simple truth. Of course, for CNBC to regain its floundering Nielsen ratings it would take all the daily staff to follow in Ms. Olick's example and report what is actually happening to the country, instead of what Joe LaVorgna believes should be happening, based on the goalseeked output his "economic" model is spewing forth. Alas, it is now far too late for the cable station to regain much needed credibility, especially when anchors tell guests who dare to question the propaganda assumptions that they disagree with they are not welcome.

More from Diana.

Two new reports out today prove the consequences of oversupply of organic inventory (12.5 months on existing homes in July according to the National Association of Realtors) and the shadow inventory of foreclosed properties (estimates vary widely and wildly). CoreLogic's Home Price Index shows home prices "flat" in July as transaction volume continues to decline. "This was the first time in five months that no year-over-year gains were reported," according to the release. In June, prices were up 2.4 percent year over year. In addition, "36 states experienced price declines in July, twice the number in May and the highest number since last November when prices nationally were still declining."

And there's the rub.

Prices have been recovering since last Fall, largely thanks to the artificial stimulus of the $8000/$6500 home buyer tax credit. But prices were also benefiting from a slight bump in confidence in the housing market, fed by an apparent drop in the foreclosure numbers. In reality, the foreclosure numbers were dropping only because banks and states were delaying the process, as they tried to cram as many borrowers as possible into what we now know is a largely unsuccessful government-backed mortgage modification program.

Now home buyer confidence is back in the dumps, which is clear from another report out today showing that for the 3rd straight month the percentage of home sellers on the market who have slashed their asking prices at least once has gone up. Twenty-six percent of sellers on the market in August, according to Trulia.com, had lowered their expectations, and hence their prices. Sellers on the market today have cut $29 billion off their collective home equity.

There is simply much more pain in store for home prices, which of course means that Jamie Dimon jumped the shark on beginning the trend of reducing NPL reserves and charge offs, when very soon even this artificial boost to earnings will no longer be applicable. And what is oddest is that just today JPM announced that both credit card delinquencies and charge offs have started to increase - this is the environment in which the bank sees loan performance continuing to improve?

h/t Mark Mansfield

Comments

[Biggvs]

Same here, except they sent me $5 cash. What kind of morons are these? Bernanke should buy Nielsen and use them to distribute his FRNs. Not quite as sexy as a helicopter ride, though.

[Village Idiot]

Yeah, but the prestige of being a Nielson Family...

[Cognitive Dissonance]

Sell that "prestige" on eBay. There's got to be some TV stupefied village idiot out there who feels it's worth more than $2. :>)

[Critical Path]

"Home Price Double Dip Begins"

and by "begin" they mean "began".... months ago.  Late to the boat as always.

[shushup]

AND YET THE MARKET KEEPS GOING UP!

[MikeyKid]

The comments over there for this story are hilarious...

[Monetize Me Captain]

hahahaha. Good call, I just read this little gem in their comments:

This cannot possibly be true unless US is in on another planet than planet Earth! Given the fact that the average House prices in US at their peak, in 2007, were hardly above the pathetic average price of $150 per Sqft, which is less than what the average House prices are now (in 2010) in Europe, Canada, Asia, etc. Given the FACT that average House prices in most of Europe, Canada, Asia, Australia, etc. in 2010 are well above $250 per Sqft which is again MUCH HIGHER than what the average House prices were in US at their peak in 2007, set aside what the average House prices in US are now in 2010.

As a proof of sample:
http://www.cnbc.com/id/38225475?slide=1

So the question is Why US Housing prices have not been able to keep up with the Developed World? One answer is lack of Universal nationalized health care in US.

More:
http://RealNewsPost.com?n=think.40908

[Seer]

To be fair to this poster, I believe the argument is that healthcare costs were resulting in less money for housing.  And on this account I'd find it a reasonable argument.  But... no SINGLE thing can be blamed, other than the fact that we've hit the growth wall.

[Hubbs]

Tough crowd here. Glad that Diana O didn't get trampled. Always impressed me as a classy gal. She and Diane Lane renewed my interest in redheads. If either Olick or Santelli leave CNBC, then that will be the sign that the gig is really up.

[hdunn2]

Well of course it makes sense that we are hitting day's highs. I mean, what, people thought the market would be up less than half a % today? thats crazy talk that would be a outright disaster.

[hdunn2]

I mean, after all, the numbers were pretty amazing today! Especially the Empire number, obviously the coast is clear and we can stop pricing in the double dip! 

Wait, i thought thats what we were doing at spx 1040..

[dark pools of soros]

not everybody HAS to sell their home.  If their are no bids on the market, are all companies worth $0 (not talking to you, HFT)

sure you got all the fools that have to foreclose... and new homes can crater until new homes stop being built, and speculators can die in one of their 6 homes

but all that chaos shouldn't pressure regular folk to feel they have to liqidate

[Village Idiot]

.

[Seer]

Ah, if you're out of a job then LIQUIDATE is the ONLY thing that you can do.  What makes this "consumer" economy function is, well, consumption, and when people are unemployed consumption becomes a bit tricky...

Again, the entire system is predicated on growth.  It can operate only for short durations of no-growth, and even shorter on negative-growth.  We're in perpetual negative-growth (folks just don't want to admit it), it's the beginning of the end...

[StychoKiller]

Since the wife and son like to keep dry, we're staying the course -- we only have two years left on a 15-year 6.5% loan anyway.

[pitz]

No bottom until mortgage credit entirely dissappears, and the only purchasers are entirely cash buyers.

[Geoff-UK]

And how much lower will houses go before people can pay cash?

Cover your balls everyone, this is going to hurt.

[Temporalist]

Diana Olick; always liked her she seems to tell it like it is.  At least someone besides Rick Santelli is allowed to.

Since Greenspan just said “What we have going for us is that the tinder for a double dip is not readily available,” he said. Still, he repeated his warning that if housing prices drop, “all bets are off.”...does that mean all bets are off now?

[StychoKiller]

Who needs tinder when World events are using flammable liquids and C4?

[Catullus]

http://www.lasvegassun.com/news/2010/sep/11/hud-secretary-says-vegas-hou...

You may turn your resume in by the end of the year, Mr. Secretary.

[Rainman]

Looks like a 3 point desperation shot from mid court to save Harry !! Big belly laugh. Millions to water up browned out lawns. Go dude !!

[virgilcaine]

Multi year housing meltdown.. were in Inning 2.

[honestann]

Yeah, but it's the second half of inning 2.

[carbonmutant]

How to die with a Whimper instead of a Bang....

[Glasgow Gary]

Shakedown Street coming to the 800K - 1.2M price band.

Here is a concept that people will finally have drilled into their psyche before this mess is over: Your capital, your savings, and your asset values depend on lots of other people's ability to support them.

If you're living in a 4M dollar house in Westchester, MetroWest Boston, or Seattle, I sure hope you love it. Because no one else will at that price. "Other people" are not moving up any more, not seeing bonuses, and not seeing wage increases. 

And they never will, again.

GG

[mark mchugh]

I just wanted to say that I think Diana Olick is hot.

Well, that and she confirms what Reggie Middleton told ZH readers a while back: banks are dragging their feet on foreclosures and sitting on the properties that will force them to realize the biggest losses.

But mostly that Diana's hot.

[Political Athiest]

I'm shocked... shocked, I tell you...

[Herry12]

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[Herry12]

I found lots of interesting information here. I love zerohedge.
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