Two weeks ago, the Irvine Housing Blog stated in Bank of America to Increase Foreclosure Rate by 600% in 2010 that Bank of America's OREO department said that the bank would increase its foreclosure activity from 7500 per month to 45,000 per month. That’s 540,000 annualized for just one bank (granted, the biggest one). If this is substantiated, one of two things is true: either 2010 foreclosures will go well over 1 million, or 2011 ones will go so far over it should scare us all breathless. Moreover, there's a solid chance that numbers like these in 8 months time will have debilitating effects on the overall economy, even before New Year's.
Not only are foreclosures, short sales and the like devastating for homeowners, they are a death knell for many banks. For the past three years, Washington's policy has been to sweep anything toxic under the carpet. Well, we’ve run out of carpet. And pondering this unequaled mess, it shouldn’t surprise anyone that jobless claims come in far worse than projected. The very foundations are starting to shake. And it no longer matters what tricks come out of the Fed, the Treasury, Wall Street, the White House or Capitol Hill. There was always just one possible end to the housing crisis: plummeting prices. The glut of newly foreclosed properties added to a hugely oversaturated market will see to it that they do fall, and fast and furious at that.