If You Thought the Housing Meltdown Was Bad…
Doug Hornig, Senior Editor, (Casey Research):

…wait until you see what’s in the cards for commercial real estate.

A Wild and Wacky Wednesday…FOMC leave stimulus and QE in place…Will G-20 try to throw cold water on commodities? GATA receives a letter from the Fed…And Now… Today’s Pfennig

As usual in Washington, it’s “Do as I say, not as I do.” While Ben Bernanke is talking up the U.S. economy, Congress and the IRS are scrambling to stop another real estate collapse.

The U.S. stock market has enjoyed a strong rally since the early spring, but while the economy has shown improvement, it still faces major headwinds. So it may be best to hedge against the U.S. dollar, which is likely to experience a significant decline over the next few months.

Sellers back in control… China, FDIC, U.S. consumers trigger global sell-off… Chris Mayer examines a disturbing trend among American investors… Signs of the times: Bernanke frets over commercial real estate, Treasury to sell U.S. mortgages to China… Greg Guenthner with a Far East opportunity growing “at an astronomical rate”…

Ten years ago, it would be hard to imagine a more stable investment than timber, or those Real Estate Investment Trusts (REITs) that bought millions of acres of harvestable trees.

Risk aversion has left the building…  CIT survives without Fed help…  SNB tries to fight the markets…  Light week for US data… And Now… Today’s Pfennig!

Like bank stocks one year ago, REITs look cheap on paper…but very expensive on pavement.  Out in the real world of plummeting demand for commercial space and constricting access to credit, commercial real estate is facing a very tough time. And that means the seemingly inexpensive shares of many REITs are not cheap at all.

Investors in common stocks tend to ignore warning signs coming from the credit markets, often at their peril. Right now, the credit markets are broadcasting the following warning: The equity of overleveraged REITs is at risk of elimination or permanent impairment.

Almost half of all American adults no longer believe that home ownership is a realistic way to build wealth. That’s according to Gail Cunningham of the National Foundation for Credit Counseling.