It is becoming commonplace to hear negative news regarding the housing market. Dollar signs get thrown around in conversations with no real practical sense for the public to grasp the magnitude of the problem. HSBC for example announced that they are pumping $35 billion into their ailing SIVs to avoid a fire sale of assets. You must ask yourself, why are large institutions so frightened about putting assets onto the market?

Before we begin our next hair-raiser, I notice a lot of people scratching their heads as global stock markets decline in the face of a "strong global economy." What you are seeing is the "pricing in" of approximately $2 trillion of lost homeowner equity in the U.S. (soon to be $3 trillion, then $4 trillion and so on). And it's only a matter of time before that equity squeeze wreaks havoc across the economic board and takes down the stock market and commodities, too.