The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.NEW YORK ( TheStreet) -- Federal Reserve officials are flailing about for new tools -- for example, more quantitative easing or a better communications strategy -- to jump-start the economy. Sadly, the Fed has few arrows left in its quill, most are crooked, and Mr. Bernanke appears to not know where the target is. The legend on Wall Street is the economy remains dormant because depressed housing values prevent homeowners from refinancing their mortgages to free up disposable income and boost consumer spending. From November 2008 to this past June, the Fed suppressed mortgage rates and helped put a floor under housing prices by purchasing mortgage-backed securities and long-term Treasuries. More recently, under Operation Twist, it has sold short-term Treasuries to purchase long-term Treasuries -- a maneuver aimed at accomplishing similarly low mortgage rates. Still, sales of existing and new homes remain depressed, and most of the modest increase in residential construction is in multiunit housing. Young Americans are more frequently renting rather than taking the plunge into home ownership, and many older Americans can't sell their homes for what they paid. During the boom years, thanks to "creative mortgages" that encouraged individuals to speculate in real estate, more homes were built than were needed, and the resulting oversupply will take years to work off. The pace of foreclosures and number of homes banks place on the market will pick up through 2012, because banks are working through the legal morass created by robo foreclosures. Though banks face civil penalties or an expensive settlement with the states' attorneys general, most homeowners not able to make payments will have to move out and their homes will hit the market. This extra supply, realtors' hype notwithstanding, will keep housing values depressed for at least the next two years. A second recession could drive down values, already off about 31% since their July 2006 peak, another 10% to 20%. Considering the risks, renting and postponing homeownership makes sense for young people not blessed with Wall Street or high-tech jobs, and not working in cities like New York and Washington where the housing recession has passed in upscale neighborhoods.