There are two sides to the housing crash debate.

You have HP'ers and a slew of real economists who predicted the housing crash before it happened, and now it's happening. And we're also saying we have much, much farther to fall, and that this crash will go worldwide. It's the fundamentals stupid, and they're still WAY out of whack.

And then you have the clueless realtors, mortgage brokers, title agents and other REIC whose livelihoods depend on people NOT wising up, even though they probably know deep down that this whole thing was a giant Ponzi Scheme and mania, but don't want to admit it to others, or even themselves.

Well, here's a hilarious and kinda sad post from that side of the coin, thanks to an eagle-eyed HP'er. You just have to read the comments. You can literally smell the denial, and hatred for sites like HP who popped their precious bubble.

What's funny is that many view HP'ers as pessimists. Actually, we're optimists - we're optimistic that home prices are going to keep crashing, until they come back to reality. We're optimistic that hundreds of thousands of unethical realtors and mortgage brokers are going to go away. And we're optimistic that people are going to be smarter in the future with their money, and with who they trust with financial decisions.

I feel like I'm reading something out of a history book, describing the denial, the cluelessness and the complete lack of a financial education that helped cause the mania, and was still alive and well even as the mania collapsed.

As long as we pay closer attention to the media than we do our own common sense, we will not be at the bottom. The media preaches that we are not at the bottom and when we listen, we confirm that. We keep waiting, and that keeps the perpetuation of the downturn in motion.

We must understand that the moment we feel we are at the bottom, we will be. When investors think the best deals are now, they will be. However, when we listen to those who keep stating that we are not there yet and believe them, we will make them right.

And here's a few choice comments for your reading pleasure...

* It seems like I run into a consumer every day who truly believes the market will continue to plunge. Those same consumers are going to feel pretty silly when they realize the market has turned and they missed the boat!

* As always, you hit the nail on the head. It's a great time to buy, NOW!!!!

* “Smart People Are Buying Real Estate Now”. I love that saying

Greg Swann admits that the Phoenix housing market has crashed. I guess the Brown Shirts and Flying Monkeys at HP were right after all, eh?

HP'ers favorite discredited Phoenix realtor Greg Swann (he who shall not be linked) admitted the other day in the Arizona Republic that Phoenix housing prices have crashed 24% from the peak (thanks HP'ers for the lead).

So should we now expect locusts and wormwood? Along with the assorted flying pigs and hot times in hell of course.

He was great at unprofessional name calling and bluster, but if you wanted sound, rational, unbiased housing market analysis, you were MUCH better off going elsewhere. It's the 6% HP'ers - it makes people say and do stupid things.

Here was his hilarious admission this week:

"Values for an average suburban Phoenix home were down 14.66% year-over-year. That doesn’t sound too bad, but prices were down almost six percent just in December. We’re down 24% from the peak in December of 2005, on average"

Yet here he was in 2006, when he was pissing on HP'ers as sewer-living Brown Shirts and Flying Monkeys who would be proven wrong:

"To lurk among the BubbleBloggers and their seething commentariat is to acquire an education in a slice of America invisible from this side of the sewer gratings. Notwithstanding the idiotic economic analysis, which is really no worse than the static-market fallacies paraded as profundities in the pages of the Arizona Republic, these sites — and not just HousingPanic — are infested with a cult-like fever to inflict suffering — at second hand, to be sure — on people who are in fact guilty of nothing except failing to have drunk the BubbleBlogger KoolAde."

"The BubbleBloggers will someday bawl balefully in private, but they will never, ever admit that they have been very publicly very foolish. You will know and I will know and in the secret chambers of their hearts they will know they were wrong all along. But as long as you don’t hold your breath waiting for that contrite admission of error, you should be fine."

So, I guess the question is, when do we get Swanndive's contrite admission of error? And how do his financially devastated former victims (I mean clients - if he had any) get their money back?

I think this embarrassing about-face shows just how bad it's getting for the ramen eaters now. The NAR talking points are out the window, and in a desperate attempt to make 6%, they're trying the one and only thing they haven't tried before:

The truth.

Go back to the height of housing bubble frenzy in 2004 - 2006: do you rememember what housing panic looked like (on the buying side)?

Remember the people camping outside of new home developments?

Remember all the people taking real estate license classes?

Remember HP'ers being called brown shirts, flying monkeys, bitter renters, bubble heads, pollyannas, chicken littles and worse?

Remember being told "they're not making any more land" and "if you don't buy now you may be priced out of the market forever"?

Remember all the flipper and home improvement shows on A&E?

Remember George Bush calling for everyone to own a home (regardless of the ability to pay or price)?

Remember David Lereah and his "Why the Real Estate Boom Will Not Bust" book?

Do you remember? Good. Because next time the madness of crowds takes over, run the other way.

2005: 23 year old "leverage is the name of the game" investor and Arizona Republic poster boy. 2007: Failure, foreclosed, fraud and forgotten.

I remember reading the Arizona Republic story on this kid and deciding right about then I had to sell my place, and eventually start a blog to warn others about the housing bubble.

So it was nice to see the mea culpa piece today in the Republic on how the Arizona housing market has crashed, there's a wave of foreclosures, and at the head of the pack is the same kid they had profiled just two years ago, who is now a complete failure, and his houses are in foreclosure.

Come on folks, tell me this wasn't obvious. Even dumb realtors with blogs in Phoenix should have been smart enough to see this coming a mile away.

But of course, they weren't.

From February 2005:

Gambling on housing - Investors squeeze Valley real estate market

Zareh Tahmassebian lives in Las Vegas but has bought 15 houses in the Phoenix area since summer. The 23-year-old mortgage banker is gambling on home values continuing to climb.

Tahmassebian and a partner paid more than $2 million for their Phoenix investment properties and estimate the houses are now worth almost $3 million. They put 10 percent or less down on each house, so only about $300,000 of their own money is on the line.

"Leverage is the name of the game," he said. "Why buy one house with cash when you can buy 10 of them at 10 percent down?"

The partners plan to sell the houses in a year or two and buy more. They aren't worried about rents covering the mortgage payments because they're counting on appreciation. Plus, Tahmassebian and his partner can write off any losses and mortgage expenses.

Flash forward to today:

Foreclosures up for investors

Investors sparked the run-up in home sales and prices during the Valley's housing boom. Now, they are behind much of the area's rapid increase in foreclosures. At least one-quarter of all Phoenix-area homes to fall into foreclosure this year are owned by investors, according to an Arizona Republic analysis of residential foreclosure records. The number is rising monthly as investors, who relied on adjustable-rate or subprime mortgages to buy properties, fall behind on climbing payments.

Las Vegas mortgage broker and investor Zareh Tahmassebian is among the out-of-state buyers who started the speculator-buying boom in metro Phoenix. In 2004, he was just 23 when he and partners bought 15 houses throughout the Valley. Tahmassebian was so bullish on Arizona real estate that, in 2005, he moved from Vegas to live in one of his Valley homes in Chandler.Now, like so many others, he is losing properties.

Earlier this year, he lost his Chandler house at a foreclosure auction. He owed $490,000 on the property he bought for $464,117 in September 2005, according to public records. Some investors, like Tahmassebian, tapped equity in one house to buy another and now owe more than the home is worth. Others put so little down on homes they are just walking away from them.