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In this video, we will analyze economic data that could predict the coming housing crash. We will look at monetary liquidity, mortgage rates, home price-to-income ratios, builder sentiment, and more to determine a probable path forward for the U.S. housing market.

The headwind facing further central bank hiking is that the global credit impulse (movement of credit from banks into the private sector) as a percentage of GDP, as shown below courtesy of Macro Alf), is already below the 2008 credit recession lows. An economy starved for credit translates to nasty recessions (led by housing) and a deep earnings contraction over the next 6 to 12 months (yellow dot on lower right). Beware “E” downgrades in those P/E calculations.

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