Kass: The Simple Math of Subprime's Slide

These posts Doug Kass were originally published on March 26 on Street Insight. They're being republished as a bonus for TheStreet.com and RealMoney.com readers. For more information about subscribing to Street Insight, please click here.

It is truly remarkable how the slightest provocation (last week's "solid" home-sales headline) had the media and other permabullish types declare that the housing market has finally bottomed (again!) and that the impact on the subslime mess would be contained.

Here is a more accurate analysis of what occurred in housing last month:

"Home sales increase in the springtime month over month, every year, even if the world is ending. It's called "the homebuying season" for a reason. So you don't look at February vs. January, or April vs. March. No, just like retailers look at Christmas vs. Christmas, not Christmas vs. July, any dummy that follows the housing market looks year over year. Here's the real numbers, and headline the MSM should have reported: Dubious NAR report shows home sales continue to crater, off 3.7% vs. last year, while unsold inventory explodes by another 763,000 units and median sales price (without incentives) is down 7.6% from peak. ...