The black hole that is the US housing crisis continues to widen, sucking in more and more American homeowners and making a mockery of the confident assertions of politicians, policymakers and the stockmarket that the worst is over.

According to the US Mortgage Bankers Association, the owners of one in 10 homes are behind in repayments and when you include foreclosures, it jumps to one in seven  homes with a mortgage are now behind on a payment (at least one) or in foreclosure. Millions and millions of people are affected as the rate grows, and looks like growing for a year or more.

Despite this week’s surprise 10.6% fall in new house starts in October, they are still up more than 10% from the lows of March-April, home prices have steadied and are up in some areas and demand for existing houses has been solid: all due to the home purchase tax credit recently extended into 2010 and expanded.

In conventional macro economic terms, the US economy is out of recession, with inventory rebuilding playing a major part in the third quarter, along with government spending and some consumer spending. It’s early in the cycle and all recoveries look like this as unemployment lags the statistics. But nothing since the Depression has seen the level of damage done to housing and to those who borrowed to buy their homes.

The home purchase assistance has done nothing to steady the overall market. This is driving people down the income scale, into public housing or worse, onto the streets, forcing them out of health cover, onto food stamp programs.

More and more are going without food during a week:

This week we learned that the US Department of Agriculture estimated there were 49.1 million Americans who struggle to eat every day of every week. was the highest reading in an annual survey in the 14 years it has been conducted.

All are linked. A new under-class is being created in America and it is not going to get any better quickly.

So economists and others who say the economy is recovering and that conditions are positive, should take a step back and a deep breath. They are in statistical terms, but in the reality of everyday life in America, it’s still grim.