There's been plenty of talk lately about the US housing market bottoming out and that it can only go up from there. But people are clutching at straws. A good example is the paltry 0.3% increase in home purchases in the US. "We'll take the improvement in the new-home market as a sign we're getting closer to the bottom and we might see some stability in the housing market by the summer," Adam York, an economist at Wachovia Corp. in Charlotte, North Carolina told Bloomberg.

But the Mortgage Bankers Association's mortgage delinquency figures suggest the bottom is nowhere in sight. According to those figures, "the percentage of mortgage holders not current on their mortgages, was 12.07 percent on a non-seasonally adjusted basis, the highest ever recorded in the MBA delinquency survey.". Just think about that number - 12.07%. In other words, one in eight mortgagees are in serious trouble.

What's even more concerning is the fact that it's not the subprime loans that are the main cause of the problem. Prime fixed-rate loans now represent the largest share of new foreclosures. In other words, the crisis has now gripped the middle class with more people losing their jobs. As the MBA says, things won't improve until the jobs situation picks up and that won't happen for some time. So any talk about the housing market bottoming out is premature and irresponsible.