Down the street and around the corner from our house there is a beautiful red brick home. It sits on its own lake, has a pool and is a custom home. For every holiday there was a driveway full of cars and an obvious party going on. At one point the landscape was completely re-done with plenty of half grown trees installed. Until recently all was normal. Then as I would drive by during my daily routine some weeds started showing up in the custom driveway, then upon careful viewing it seems that this house is vacant. I guess the party is over.

In 2000 we had a financial mess because the so called Dot-Com's were revealed to be what they actually were ....worthless. Plenty of money went away because investors ( really speculators) would invest in these companies because of some promise of future profits. You may remember just how ludicrous this all became with the promise of some sort of internet site that might offer a new service raising millions just on the notion that the expected service would create millions in new revenue. Every day there was a new wonderful revelation about what these new Dot-Com's would do for you and I...then Pop they were gone....along with lots of money.

This concept is not new. It has happened before with Wall Street many times. Lots of money being made and then like rolling the wrong dice all the money is swept off of the table. There is a difference that is present with the current housing slump though. With the Dot-Com and the Wall Street crashes there is usually nothing left. There is no intrinsic value remaining and no real need for the investment. No utility.

Housing has a real value. It may not be worth what you used to think it was worth. But it has a value because we all need a place to call home. Now that we are seeing this value decline and the equity we all had dry up we will all learn a valuable lesson. The party is over and we all need to pay off a mortgage during our working lives.