The latest erratic move on the minds of major advertisers that the company depends on for revenue was Musks decision to abolish a new official label on high-profile Twitter accounts just hours after introducing it.

Twitter began adding gray labels to prominent accounts Wednesday, including brands like Coca-Cola, Nike and Apple, to indicate that they are authentic. A few hours later, the labels started disappearing.

Apart from being an aesthetic nightmare when looking at the Twitter feed, it was simply another way of creating a two-class system, the billionaire Tesla CEO told advertisers in an hour-long conversation broadcast live on Twitter. It wasnt addressing the core problem.

Musks comments were his most expansive about Twitters future since he closed a $44 billion deal to buy the company late last month, dismissed its top executives almost immediately and, on Friday, fired roughly half of its workforce. Major brands including General Motors, United Airlines, General Mills and others have temporarily halted buying ads on the platform as they watch whether Musks plans to loosen its guardrails against hate speech will lead to a rise in online toxicity.

Scores of companies big and small made their presence known among the more than 100,000 Twitter Space listeners by signing in with their brand Twitter accounts. The brand accounts for companies including banks Deutsche Bank, TD Ameritrade, gas company Chevron, automaker Nissan, airline Air Canada and many others appeared. Car brand Audi, which has paused Twitter ads, was there, as was retailer R.E.I., which said after the call its ads were still paused.

Musk said hes still planning a content moderation council representing diverse viewpoints that will tackle inappropriate content and reassure advertisers, but it would take a few months to put together. He said it will be advisory and not a command council.

Lou Paskalis, longtime marketing and media executive and former Bank of America head of global media, said the briefing raised questions that will likely leave Fortune 500 advertisers uneasy.

The biggest concern for big advertisers is brand safety and risk avoidance, he said. And Musk seems uninterested in reining in his Twitter persona that can be divisive such as his tweet ahead of the election advising Americans to vote Republican.

To come out like Elon did and say vote Republican since theres a Democrat in the White House I dont know what marketer wants to go near that, he said.

One solution could be to hire a CEO to run the company and create stability while Musk continues to be his Chief Twit persona, Paskalis said.

Musk had earlier threatened by tweet a thermonuclear name & shame on advertisers that quit Twitter. But he took a more measured approach Wednesday, asking them to give it a minute and kind of see how things are evolving.

The best way to understand whats going on with Twitter is use Twitter, he told the group, which was represented mostly by the head of the Interactive Advertising Bureau, a trade association.

However, the confusion on Twitter continued Wednesday. The rollout hours earlier of the official labels appeared arbitrary, with some politicians, news outlets and well-known personalities getting the label and others not. In some cases, whether users could see an accounts official label appeared to depend on what country they were in.

Then the labels started disappearing.

YouTube personality and author John Green got the label but his younger brother and vlogging partner Hank Green didnt make the cut. Then John Greens label was gone. Another popular YouTuber, Marques Brownlee, who posts videos on technology, tweeted he got the label, then tweeted again that it disappeared.

I just killed it, Musk responded, though at first it wasnt clear if he was referring specifically to Brownlees label or the entire project.

The sites current system of using blue checks to confirm an accounts authenticity will soon go away for those who dont pay a monthly fee. The checkmarks will be available for anyone willing to pay a $7.99-a-month subscription, which will also include some bonus features, such as fewer ads and the ability to have tweets given greater visibility than those coming from non-subscribers.

The platforms current verification system has been in place since 2009 and was created to ensure high-profile and public-facing accounts are who they say they are.

Experts have expressed concern that making the checkmark available to anyone for a fee could lead to impersonations and the spreading of misinformation and scams.

The gray label a color that tends to blend into the background whether you use light or dark mode to scroll Twitter was an apparent compromise.

Esther Crawford, a Twitter employee who has been working on the verification overhaul, had said Tuesday on Twitter that the official label would be added to select accounts when the new system launches.

Not all previously verified accounts will get the Official label and the label is not available for purchase, said Crawford.

But after the labels started disappearing Wednesday, she again took to Twitter to say there are no sacred cows in product at Twitter anymore.

Elon is willing to try lots of things many will fail, some will succeed, she said.

There are about 423,000 verified accounts under the outgoing system. Many of those belong to celebrities, businesses and politicians.

But a large chunk of verified accounts belong to individual journalists, some with tiny followings at local newspapers and news sites around the world. The idea was to verify reporters so their identities couldnt be used to push false information on Twitter.

Musk, who often bristles at critical news coverage, pushed back against that use of the tool Wednesday, saying he wanted to elevate citizen journalism and the voice of the people over publications he suggested had too much influence in defining the Western narrative. Journalism professionals generally consider Musks concept of elevating citizen journalists dangerous because it ignores the need for standards, including fact-checking, that responsible news organizations enforce.

On Wednesday, Redfin told shareholders that it plans to shutter its home buying program. As it does so, it will lay off 862 employeesor 13% of its workforce.

Whats going on? While the ongoing housing correction has hit the entire country, its particularly sharp in bubbly housing markets like Phoenix and Las Vegas. Those markets have gone straight from Pandemic Housing Boom to Pandemic Housing Bust. Theyre also the places where iBuyers like Redfin and Opendoor have significant exposure.

These so-called iBuyer programs dont operate like normal flippers. Instead of creating value through renovating homes, they instead use algorithms to make speedy offers directly to sellers. The service being that it reduces the hassle for sellers. As long as iBuyers can quickly resell the home, things can go smoothly. However, if home prices begin to fall, things can go south very fast.

That downside scenario, of course, is here.

We notice immediately when fewer people are on our website and fewer are signing up for tours Were sitting on $350 million worth of homes for sale that we bought with our own money, or worse bought with borrowed money. And what we always told investors is that we would protect our balance sheet by acting quickly. We dont have hope as a strategy. We immediately started marking down things, Redfin CEO Glenn Kelman recently told Fortune.

By the end of January 2023, Redfin expects to reduce its portfolio of homes down to $85 million. And by the end of the second quarter of 2023, all of its homes should be sold off.

Nationally, the lagged Case-Shiller Index shows U.S. home prices fell 1.3% between June and August. However, in pandemic boomtowns, that home price correction is much greater. According to the Burns Home Value Index, Phoenix home values have already fallen 10% from their 2022 peak.

On one hand, iBuyers are getting pinched by housing busts in markets like Phoenix. On the other hand, iBuyers are also helping to accelerate housing busts in markets like Phoenix.

"These iBuyers adjust [home] prices almost like clock work if a home doesn't sell. So in submarkets where they have a presence they are also price setters in a faster way than past cycles," Rick Palacios Jr., head of research at John Burns Real Estate Consulting, tells Fortune.

Redfin CEO Glenn Kelman agrees that iBuyers, along with other investors who piled into the market during the boom, are helping to drive home prices down faster this time around.

When the shiitake mushrooms hit the fan, you [investors] want to get out first. The way to do that is to figure out where the lowest sale is, and be 2% below that. And if it doesnt sell in the first weekend, move it down [again], Kelman recently told Fortune. My take is that because builders and iBuyers account for more inventory, that leads to a faster correction."

Not long after the Federal Reserve kicked into inflation-fighting mode, unsold housing inventory began to climb across the country. As of October, inventory levels are up 33% on a year-over-year basis. However, in bubbly markets where iBuyers are exposed, inventory growth is much more pronounced. In Phoenix, active listings for sale on realtor.com are up 173% on a year-over-year basis. While markets like Austin and Salt Lake City are up 136% and 117%, respectively.

For most sellers, there's a psychological aspect to home prices: They don't want to lower their price tag unless economics forces their hand. That's just not how algorithm-run iBuyer programs work. They want out first, and they aren't afraid to cut aggressively in order to do so.

Look no further than this three-bedroom home in Las Vegas. In April, Redfin bought the home for $600,000. Just weeks later, Redfin listed it for sale in at $624,900. But it was too late: The Las Vegas housing market had already moved into correction mode. Fast-forward to November, and the listing just got taken off the market after a series of price cuts brought its list price to $524,900.

Even after all these aggressive price cuts, iBuyers still have a tremendous amount of inventory to offload in bubbly markets. In Phoenix alone, Parcl Labs estimates iBuyers still own around $1 billion worth of units.

"Their [iBuyers] sales transactions alone accounted for nearly 10% of all Phoenix sales activity in September. As more pressure builds for them to exit their positions they will likely become more aggressive in their pricing, this will continue a downward spiral until prices reach a point where demand enters to stabilize it," Jason Lewris, co-founder of Parcl Labs, tells Fortune. "All of the conditions are there for a crash [in Phoenix]."

Why are markets like Phoenix and Las Vegas rolling over so fast? Moody's Analytics chief economist Mark Zandi points to detached fundamentals. Nationally, Moody's calculates the typical U.S. housing market is "overvalued" by around 23%. However, the firm says markets like Phoenix and Las Vegas are "overvalued" by over 50%. For comparison, Phoenix and Las Vegas were "overvalued" by 51% and 54%, respectively, just as the housing bubble peaked in 2006.

Heading forward, Zandi expects U.S. home prices to decline by around 10% from peak-to-trough. But in "significantly overvalued" markets like Phoenix, he estimates prices will fall between 15% to 20%. And if a recession hits, he says, that decline in "significantly overvalued" markets could be between 25% to 30%. (You can find Moody's forecast for 322 housing markets here).

Ironically, Redfin's iBuyer woes might make Zillow executives feel smartor at least lucky.

Back in November, Zillow announced it'd halt its failed iBuyer programwhich was notoriously overpaying for homesand sell off its remaining homes through early 2022. It turns out, Zillow sold off its homes at the peak of the Pandemic Housing Boom. While Zillow lost a lot of money, it could've lost a lot more.

Hungry for more housing data? Follow me on Twitter at @NewsLambert.

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