The dominoes are falling, says Adam Lass in Taipan Daily.

The housing market is still a shambles, nine U.S. banks have failed so far this year, and Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE) are all but nationalized. What’s more, the world’s central bankers can’t agree on what caused this mess, let along how to fix it.

But amid the gloom and doom, Adam says put options on MetLife (NYSE:MET), Bank of America (NYSE:BAC) and Capital One (NYSE:COF) can still yield triple-digit gains…

Central bankers see few options to repair a damaged financial sector and weak global economy underway for years now. Thud.

Thud, thud, thud.

Bang!

It’s the sound of massive dominos falling, my friends – a worrisome crash that has become all too familiar to observers of the ongoing financial crisis.

U.S. home foreclosures climbed 55% in between June and July. Year over year, U.S. banks have tripled the number of “repossessed” houses.

I put repossess in quotes because it is questionable as to whether many of these folks ever actually owned the houses in question. Seeing as how their perverse loans allowed them no equity stake whatsoever, it might appear to a disinterested observer that they are in fact simply being evicted from rented houses.

Thud!

These foreclosures are both a fallen domino and the trigger for the next big crash. When they are wrapped into our national statistics, they distort our understanding of the situation at hand in the most peculiar ways.

First of all, they make it appear that both U.S. housing sales and GDP are actually gaining ground. In fact, just Monday, I saw some of Wall Street’s favorite shills post headlines touting July’s “3.1% Increase in Home Sales!”

The catch? Everyone involved is losing their shirts on these sales.

There is now an 11-month backlog – some 4.67 million unsold houses and condos – weighing down the U.S. housing market. This glut of “resale inventory” is keeping builders on the sidelines. Permits and broken ground are at a 17-year low. The Dow Jones U.S. Home Construction Index continues to grovel along around the 300 mark, making for a 61% decline from the heady days of early 2007.

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