Just a staggering figure - even surprised me. Again, I truly think many on Wall Street have no idea what is going out in "Middle America" - I've repeated that countless times since summer 2007. Those who simply want to live in a home have to "pay up" to the same level the levered speculators drive up the local market, just to live in a home. Normal people (teachers, policemen) with normal jobs could not afford homes in many of the top 15 markets in America - northern VA, most major cities in CA, Seattle, NYC, parts of New Jersey, parts of Florida, even Phoenix, Portland and the like caught up at the tail end of the bubble. (What Should Median Home Prices be Today?) The sick thing is the government, with its continued interference is trying to stop home prices from falling - which would help many in the country by lowering their cost of living. Of course at the expense of those already in homes.

But this is what an era of easy money and low interest rates creates. Combine it with financial illiteracy that swamps the nation and you have "the Black Swan" event. And all the actions we are doing now, will create moral hazards and unintended consequences which will create the Black Swan of 2014-2015. Humans are nothing if not predictable.

• Al Ray is so strapped for cash, the only time he eats out is on Wednesday or Sunday, when the local McDonald's sells hamburgers for 49 cents. Ray lost his engineering job last November, and has been working as high school tutor, scratching out about $1,000 a month — if he's lucky. He struggled to make his $1,400 monthly mortgage payment and $330 monthly homeowners' association fee until May, when he stopped paying. Ray, 44, is looking for work and renting out a room in his two-bedroom condo in Davie, Fla., for $500, but his monthly income doesn't match his expenses and he's facing foreclosure. "I barely have money to survive," he said.
• Ray is one of more than 7.5 million people — almost 15 percent of American homeowners with a mortgage — who are spending half of their income or more on housing costs, according to 2007 data released Tuesday by the U.S. Census Bureau.

• Traditionally, the government and most lenders consider a homeowner spending 30 percent or more of their income on housing costs to be financially burdened.