There are many questions out there now regarding our economy and the housing market. The first question that comes to mind is why are gas prices still hovering around $4 per gallon??? Oil prices (the per barrel price) has now fallen in excess of 20% over the past 30 days. At the very least, prices at the pump should have fallen by over 80 cents per gallon!!!

But, as you know, this has not happened. Funny the way this gas price thing works....they are very quick to jump the price but it takes much longer to bring it back down. The price of gasoline is very important if our economy is to recover any time soon. With very few exceptions, our Country is dependant on their automobiles and have very few alternatives when it comes to driving to work. The pain of paying close to $4 per gallon for gas erodes income that could be spent on other goods and services or even housing payments. The average person is now paying at least twice as much for gas than they did just 18 months ago and this is adding to our slumping economy. So, when will we see prices at the pump drop back below $3 per gallon???

The next question is why is housing sales continuing to fall??? We still have rates in the mid 6% (a number that ignited the housing market in the 90's). Housing prices have fallen across the Country by an average of 20% and more in many areas. Unemployment has risen lately but not at a rapid pace. So, rates are low, prices have fallen and employment is somewhat stable....why the fall in sales???

It would seem to me that housing should begin to pick up some steam given the facts above. The problem lies somewhat in oil prices but mostly on consumer confidence and the outlook for the economy over the next several years. Some economist are predicting an extended recession and some are even using the "D" word...possible Depression for our economy. Headlines like these do not instill confident in the potential home buyer which will continue to leave many on the sidelines waiting for a sign of recovery.

The answer is that our economy and housing will not recover until the American public regains their confidence in our economy. Most of the pieces are in place for this recovery to begin...except for the most important piece...the American public......