For those of you who read my last post and disagreed with Deutsche Bank's report that nearly 50% of all mortgages will be underwater by 2011, a recent AP report may be more up your alley, so long as you don't think a rising tide of foreclosures will negatively impact property values.

The AP writes, "It was - note the past tense - the worst housing recession anyone but survivors of the Great Depression can remember."

The recent AP article goes on to say, "By every measure, except foreclosures, the housing market has stabilized and many areas are recovering, according to a spate of data released in the past two weeks".

"By every measure, except foreclosures"?

Are foreclosures no longer responsible for driving home values lower?

Are foreclosures no longer an integral part of that pesky supply and demand relationship which drives home values?

How is it possible to determine the health of the housing market without considering the volume and direction of the number of foreclosures?

If there are more foreclosures than there are buyers entering the market, isn't this something that should be considered?

According to the NAR, while existing home sales have risen for four consecutive months on a seasonally adjusted basis, they are still down -0.2% from June of 2008 to June of 2009.  On the other hand, according to RealtyTrac, foreclosure filings are up 33% year over year in June.