Sales of newly constructed homes rose in September, according to the monthly report from the U.S. Census Bureau, inching up 2.7% from August to an annualized rate of 464,000.

But the reading was still the worst September for new home sales since 1981. Sales are down 33.1% from September of 2007, and far below the pace of the boom years. In 2005, for example, 1.3 million new homes were sold.

Unbelieveably low rates in the early to mid-2000s created such interest in real estate that 40% of home purchases in 2005 were non-owner-occupied -- investment properties, 2nd homes, vacation homes, etc. So, when you compare todays data to anything in 2005, you are getting a really skewed look at things. 2005 was the odd year, not 2008. 2008 is far more normal than most consumers realize.

It's like the tech boom of the late 90s. Everyone was pouring money into theses stocks without thinking. And it always crashes...eventually.

But it's great news that today's new home sales numbers are higher than last month. We will recover from today's problems. And, hopefully, we'll be a whole lot smarter.