WHAT COUNTS IN WINGNUT WORLD

There are 2 pretty big economic stories today. First, the outgoing director of the IMF :

IMF warns of abrupt dollar fall
By Eoin Callan in Washington
Financial Times
Published: October 22 2007 20:03 Last updated: October 22 2007 20:03

The dollar hit a record low against the euro on Monday as Rodrigo Rato, managing director of the International Monetary Fund warned that the US currency could suffer a dramatic fall that would shake confidence in American assets.

“Up to now, movements in exchange rates have been orderly and in line with
fundamentals. But there are risks that an abrupt fall in the dollar could either be triggered by, or itself trigger, a loss of confidence in dollar assets,” Mr Rato said.

Second, the U.S. housing market:

September home sales plunge
By Christine Dugas and Noelle Knox, USA TODAY
10/24/2007

With signs of even darker days ahead, sales of existing homes collapsed in September, falling a far-worse-than-expected 8% from August — the steepest dive since the National Association of Realtors began combining figures for single-family homes and condos in 1999.

"Mortgage finance is in a major depression," says Scott Anderson, senior economist at Wells Fargo. (WFC) In states such as California and Florida that saw huge gains during the boom, "we're going to have price declines not seen since the Great Depression, through 2008."

A record number of homes for sale has been magnified by a crush of homes entering foreclosure. There were 4.4 million homes on the market in September — a 10.5-month supply and the most since the NAR began tracking the data.

"The fundamental problem for the market is too much inventory," says Mark Zandi, chief economist for Moody's Economy.com. Sales over the next few months, Zandi says, are "going to be so bad it will be hard to imagine worse," and that will be the bottom.

But in Wingnut World, the really big story is the Scott Beauchamp/New Republic fuss.