Though Stack published his newsletter Friday evening, I'm sure he found further support for his real estate beliefs from the news Monday. Stack had noted that one of the biggest sources of concern about the housing market is that "new-home construction [is] hitting record highs, while new home sales have already dropped close to 20-month lows." According to data released Monday by the U.S. Department of Commerce, this divergence between supply and demand has widened even further. In January, the inventory-to-sales ratio for new homes increased to 4.7 months - its highest level since mid-2000. Read news story. The increasing supply of new home sales is just one straw in the wind, of course. But on any of a number of fronts, Stack finds disturbing parallels between investors' attitudes today toward real estate with their attitudes toward Internet stocks prior to their bubble bursting in March 2000. Whether the speculative frenzy is in Internet stocks, real estate or any other asset, for that matter, Stack believes that the telltale signs of a bubble include: Buying based only on anticipation of rising prices rather than on fundamentals. Expectations based on recent gains rather than on historic norms. No respect for risk. Major perceived risk: "Not being on board" rather than "possibly losing money." Speculation and greed prevail. Stack concludes: "Now I know housing bubbles tend to be regional or selective. But speaking at conferences, I keep hearing more and more war stories from regions all over the country: Houses selling above the asking price to the highest bidder. Houses being bought, then immediately put back on the market hoping to flip a quick profit. This is truly nutty stuff that easily rivals the 'can't-lose' psychology on Wall Street in the bubble years."