Friday Morning: “Most People Are In Over Their Heads”

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Good morning. Essayist and novelist Charles Hugh Smith writes often about housing and the economy, and this morning he looks at rising debt levels and concludes Americans are overextended, and Californians are really overextended.

‘Most people are in over their heads and the problem is not just confined to sub prime borrowers,’ he writes.

Interesting stuff also on California: He write that the median household income in America, roughly $40,000, is enough to support buying a median-priced house in the U.S., at about $215,000. But what about California? ‘California’s median income is about $50,000--certainly not enough to justify median house prices in the $600,000 range.’

So my question: What’s different in California? Economically, how does California income go so much further in home-buying?