Rocky Vega

Earlier today we looked at how the housing market is teetering atop artificially created price levels engineered through bailout and stimulus. Now, we turn our attention to the official evidence of it. In its latest Quarterly Report to Congress (pdf), the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) documents how, “Supporting home prices is an explicit policy goal of the Government.”

According to Tracy Alloway at the Financial Times:

“…propping up house prices is now an explicit goal of the US government… So explicit in fact, that the Special Inspector General for the Troubled Asset Relief Program has knocked up this little chart to show how various policy programmes (Hamp, MHA, etc.) lead to higher houseprices:”

Home Prices

Alloway goes on to cite the SIGTARP report:

“Supporting home prices is an explicit policy goal of the Government. As the White House stated in the announcement of HAMP for example, ‘President Obama’s programs to prevent foreclosures will help bolster home prices.'”

It’s pretty tough to see how the housing market can reach the kind of equilibrium price levels that will support a sustainable recovery with this unabashed government intervention. When the policy support goes away, which because of its cost it eventually must, the second leg down in housing is likely to follow in short order.

See Alloway’s complete post in Financial Times Alphaville coverage of the US housing bubble v2.0.

Rocky Vega

Rocky Vega is publisher of Agora Financial International, where he advances the growth of Agora Financial publishing enterprises outside of the US. Previously, he was publisher of The Daily Reckoning, and founding publisher of both UrbanTurf and RFID Update -- which he ran from Brazil, Chile, and Puerto Rico -- as well as associate publisher of FierceFinance. Rocky has an honors MS from the Stockholm School of Economics and an honors BA from Harvard University, where he served on the board of directors for Let?s Go Publications, Harvard Student Agencies, and The Harvard Advocate.

  • Runfastandwin

    As someone who bought a house in February of 2006, I certainly hope so.

  • http://www.yams.com TomPier

    great post as usual!

  • intinitweta

    My friend recently lost their home to foreclosure and now they are planning to file for bankcrupcy. They recently went to file their taxes and they found out IRS is billing them 52,000 for abandonment even though they have tried for months asking for help from the banks. Need some advise on how i can help guide my friend to the right people to settle the foreclosures.

  • http://www.pcdriverssite.com driver detective windows 7

    “The first requisite of success is the ability to apply your physical and mental energies to one problem without growing weary.” –– Thomas Edison

  • http://fatslicegame.blogspot.com Fat Slice

    Thanks. Very nice blog. Your web site is very beautiful….

  • http://www.ipad-buys.com iPad cost

    Finally something fresh and cool that make sense! I would like to see more about this and that is what I’m going to do.

  • http://www.ipadspeakers.info/ ipad speakers

    I benefit reading it. I have need of to learn more on this subject.. Thanks for the sake letter this marvellous post..

  • http://www.youtube.com/watch?v=qU7tigYFF0k Ways To Stop A Panic Attack Instantly

    Hello, i think that i saw you visited my web site thus i came to “return the favor”.I’m attempting to find things to enhance my website!I suppose its ok to use a few of your ideas!!

  • Pingback: Trackback

  • Pingback: Terminator Genesis

  • Pingback: agence location voitures maroc casablanca aeroport mohammed 5 rabat p

  • Pingback: Trackback

  • Pingback: Trackback

  • Pingback: Trackback

  • Pingback: Trackback

  • Pingback: Trackback

Recent Articles

Why the Fed Will Launch Another Round of QE

Richard Duncan

Ben Bernanke introduced the world to the concept of "quantitative easing" back in 2002. It was an "unorthodox plan" to save the economy from the horrors of deflation. But the monstrous economy it has actually created is in some ways far worse. And as Richard Duncan explains, it's not going to end any time soon. Read on..


How to Safeguard Your Digital Currency

Dominic Frisby

While the technical details of Bitcoin may intimidate the novice, they shouldn’t keep him from getting in on a digital currency revolution that -- while taking different forms -- isn’t going away. How do you get the simplest, easiest-to-act-on tips about how to invest, safeguard and grow your digital wealth? Dominic Frisby has more…


Solar to Save the World, Ebola to Maim it

Chris Campbell

The duality is stark. In one hand, we have an energy renaissance underway, in the other, a virus is threatening to wreak havoc on the markets and, potentially, your life. Nothing we’re currently doing to fight the Ebola virus will work in 2014, say the researchers. Nothing we’re currently doing will beat it in 2015, either. We need a new game-plan. Read on…


How to Profit From the “Cycle of Hype”

Greg Guenthner

Lose your shirt in 3D printing stocks this year? Don’t kick yourself. You’re not alone. (Okay, kick yourself a little if it’ll make you feel better.) You need to make sure you don’t lose your 3D-printed shirt in the next tech craze. Because there will be a next time. Look, it’s really not your fault if you got taken for a ride on 3D stocks. Greg Guenthner has more...