Spike in existing home sales mostly fueled by foreclosures

The nearly 500-point dead-cat-bounce on Wall Street yesterday was credited in part to the reported increase in existing home sales. The headline about homes: resales rose 5.1% to a 4.72 million annual rate from 4.49 million in January, via the National Association of Realtors.

The devil rested in the details which showed that 45% of that was firesales from distressed homes. The downside? All that cheap inventory drove all home prices lower.