A massive transfer of wealth from the illiquid unlucky to the liquid lucky is about to happen...

Here's a perspective into the US real estate market that will open your eyes... The chart illustrates the US median price of a single-family home over the past 38 years. Thanks, in part, to low long-term interest rates, the trend from 1991 to 2005 was impressive. Not only did housing prices increase at a rapid rate, the rate at which housing prices increased also increased.

The chart shows how housing prices have dropped well below their accelerated upward trend and 29% from the 2005 peak. It is worth noting that housing prices are currently decreasing at a rapid rate. In fact, the rate at which housing prices have been decreasing has been increasing.

One interesting point is that if we discard the dramatic increases after the late 90's, the market is already below the levels it would have reached had the more tame growth since the 70's been maintained.

The value of real estate assets does not fall to zero, however, which is where this chart would indicate should the crazy decrease maintain this course to 2010. This presents a unique opportunity for savvy buyers that can sort through hopeless assets and the valuable assets depressed due to panic and short term liquidity problems and nothing else.

Thus, a massive transfer of wealth from the illiquid unlucky to the liquid lucky is about to happen...