Stimulus delays the inevitable, delays the recovery

From the BostonHerald.com:

There’s a silver lining for would-be home buyers who missed the April 30 deadline for the $8,000 federal tax credit: Sellers are dropping prices.

...

“Sellers are realizing there’s no artificial stimulus to help the market, so they’re lowering prices,” said Rick Healey, broker-owner at Foster-Healey Real Estate in Fitchburg. “The demise of the tax credit has brought a sense of reality to pricing.”

This seems to be a real life showdown of Austrian economics vs. Keynesianism. The Austrians say, let prices fall, find a bottom, and yes, there will be pain, but the recovery will quickly follow. Efforts to stimulate and prop up prices just delay the inevitable. Who knows, maybe housing is about to bottom?