A healthy market has a 4-6 month supply of homes for sale.
Morgan Stanley recently estimated there are 5 million homes in the shadow inventory. These are homes in default that the banks are (currently) holding off the market.
When adding in these additional 5 million homes, soon to enter the market, we now have over 24 months supply of homes. (And don't forget the new supply being churned out by the home builders.)
This was also the final month that will show sales juiced by the home buyer tax credit.
Look for the July sales number released next month to be a blood bath. Less homes coming off the market. A tsunami of shadow homes flooding the market.
But have no fear, Helicopter Benjamin Bernanke said today he now has plans to buy additional mortgages if necessary. I guess he could just buy all 8.9 million homes soon to be on the market.
Instead the money stays at the top, and the size of the hungry and poor population continues to grow. A society structured this way has only ended one way, and it is not a pretty sight.