The sudden and devastating swiftness of the housing bubble crash

Folks, I'm not sure if you're sensing it, but it is all falling apart so quickly, so suddenly now.

Even I, having been studying and analyzing the bubble for years, and been blogging on this subject for over eight months now, am amazed and surprised by how fast the bubble is blowing and the speed of the destruction nationwide. Mass euphoria quickly turned into mass panic.

So I hearken back to this article about Cisco from 2001, when a similar sudden and chilling market reversal caused Cisco to take a $2 Billion write-down and started the long march to near worthlessness for their shareholders:

To keep up with the frenetic pace of network-equipment orders during the Internet's heyday in the mid- and late-1990s, Cisco placed big orders for communications chips, optical lasers and subassembly boards from its suppliers.

But the wicked combination of the dot-com implosion and the deteriorating economic conditions in the United States and abroad finally caught up with the world's largest data networking equipment maker, causing sales to decline at an astonishing rate and leaving Cisco with billions of dollars in equipment and materials that it couldn't sell and likely won't be able to sell in the next 12 months.

Skip ahead a few years, to this sudden and chilling housing market collapse, and you get this:

Home flippers' investments flop

Joe Passarelli wakes up anxious and sweaty some nights, wondering how much longer it will take to sell his never-lived-in townhouse south of Stuart.

Despite slashing his asking price by $55,000 to $285,000 and keeping vigil at sparsely attended open houses for six months, he still has no takers.

Passarelli made out well last year, grossing about $100,000 on a home he flipped in St. Lucie West and an additional $50,000 from his mortgage and real estate business. But this year is emerging quite differently.

"The end result is it may have to all be given back," he said.

Fearing they'll lose more if they hang on to homes in the community, some investors are walking away from deposits of $30,000 to $50,000, said Stuart-based real estate broker Mike Morgan, who sold several homes in Martin's Crossing.

"What happened there is no different than what happened in the condo market and everywhere else: greed, greed, greed," Morgan said.

As with the Internet boom of the late 1990s, those who stand to lose most in this shifting market are novice investors and those who bought too much too late.