Case-Shiller HPI 2nd derivative problems?

Earlier this year, as economic conditions were still getting worse but at a lesser pace, market analysts talked about an improving "second derivative" as a hopeful sign for the future.

Is it now time to start talking about second derivatives again?

Maybe so, according to the latest S&P Case-Shiller Home Price Index where, after four straight months of improvement, the change to the 20-city home price index was worse in August than in July as indicated in the graphic below.
Of course, it's clear to see in the chart that this "seasonally adjusted" data is not being adjusted very well and that may be a factor in the most recent result. Also, there are quite a few other instances where a monthly trend change is undone in the subsequent month.

The proof in the pudding will come with another few months of data, but, given this early indication of where home prices might be heading, it's a good thing that they're extending the home buyer tax credit.

The news for housing continues to be good (mostly as a result of Uncle Sam's largess in issuing rebate checks and keeping mortgage rates freakishly low), prices in some areas such as San Francisco and Minneapolis mounting big comebacks in recent months, while other areas such as Las Vegas just continue to tumble.

Actually, Las Vegas is now the only place where prices are still dropping consistently, that bright green line below representing property values in Sin City that are about to complete a round trip to 2000 levels before year-end, based on the current trajectory.
Note that, to aid in viewing the chart above, the legend in the upper left is in the same order as the top-to-bottom positions of the curves on the right.

Naturally, Washington D.C. and New York continue to hold onto their price gains better than any other area. Since most of our problems have originated in these two areas, it hardly seems fair, but that's the way it is.

Note: For those of you new to the concept, the second derivative is akin to the acceleration/deceleration of a moving body, whereas, the first derivative is the direction of the movement itself. The thinking goes that, oftentimes, when acceleration turns to deceleration, the direction later changes as it did for the U.S. economy a few months ago.