ANOTHER RIGHT. ALAS.

In November, I posted:
HOUSE OF CARDS My prediction regarding the stock market? Ditto, the housing market. It will sink ever deeper than it has to date, and it won't be surfacing for a long time. That’s despite expert advice that this is the ideal time to buy, despite widely running ads about all the money to be made in real estate, and despite a National Public Radio report just two days ago about how the housing market is already turning around. They say it is. I predict that with a few exceptions, it is not.

Sadly, I got that one right, too. On December 30, Bloomberg News wrote:
Phoenix, the desert city that three years ago led the U.S. in home price growth, had the nation’s worst housing market during October as sales of foreclosed properties depressed prices.
The cost of a single-family home plunged 33 percent from a year earlier, according to an S&P/Case Shiller index. The decline was worse than Las Vegas , where prices fell 32 percent… U.S. House prices fell 18 percent in October, a record in eight years of data.

One day later, The Guardian (UK) reported:
House prices in 20 big US cities fell at their fastest rate on record in the year to October as rising unemployment, rationed credit and a glut of foreclosed properties led to fresh weakness in the market…
David Blitzer, chairman of the index committee at Standard & Poor's, said: "The bear market continues; home prices are back to their March 2004 levels."
The gloomy survey prompted analysts to predict that the housing downturn in the world's biggest economy will last for a fourth year in 2009.

A word about my predictions. By no means am I the only one who foresaw falling prices. But for every one of us gloomsters, there was an abundance of happy optimists. As I wrote my housing prediction, real estate was being touted as a good investment, and respected commentators were talking about promising signs of a turnaround.

Why has my untrained eye been so much more accurate than that of so many professionals? I'm not entirely sure, but this quote from The Shadow of the Wind by Carolos Ruiz Zafon caught my attention. “Clara’s father believed that nations never see themselves clearly in the mirror, much less when war preys on their minds. He had a good understanding of history and knew that the future could be read much more clearly in the streets, factories, and barracks than in the morning press.”

I hope my predictions, the gloomy and the optimistic, prove helpful to you in 2009.

— jules