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How Bad Is The US Housing Crisis?

 

Can Ben BEN BERNEKE and the central banks fix the US housing crisis?   

An article posted by Calculated Risk

on December 28 pointed to the possible loss of

$1 Trillion in Mortgage Losses?

and the real possibility of Americans 'walk' from loans as reported by Australia theage.com.

In another news segment, well respected Yale Professor Robert Schiller discussed with Blomberg that the decline in the US housing market could take years to bottom out.

Shiller: “It’s Not Implausible that Prices Wont Bottom Out for Another 5 Years”

Professor Robert Shiller joins Bloomberg to discuss the latest results of the S&P/Case-Shiller home price indices. Shiller suggests that the boom is clearly unraveling with broad based price declines and the seizing up of the credit markets. Shiller goes on to state that “it’s not implausible that prices wont bottom out for another five years.

Originally aired on: 12/26/2007 on Bloomberg

Running Time: 6 minutes 23 seconds

4 comments • James Wong Richmond Realtor • December 29 2007 05:20PM

Comments

Historically down cycles have taken 5-7 years to play out.  Depending on the region, we're about 2 years into this cycle, so another 5 years seems about right historically.  The even bigger problem than the prospect of $1 Trillion in mortgage losses is due to how our fractional banking system works, that will take several trillion dollars out of the pool for future loans, so the impact is larger.
Posted by Matt Heaton (Timu Corp - CEO, ActiveRain - Co-founder) over 2 years ago
The US economy is supported to a large degree by "instant gratification" and consumer spendings. The world had been awashed with liquidity and and loose credit resulting in the building up of asset bubbles. The US now has to deal with declining house prices, bad mortgage loans and huge consumer credit card debts.
Posted by James Wong Richmond Realtor (Sutton West Coast Realty, BC) over 2 years ago
Professor Shiller has been right more than wrong in the past.  It will be an interesting ride over the next few years.  I believe we have a way to go.
Posted by PHILIP TURNER-MORTGAGE BANKER SINCE 1980 (MCCUE MORTGAGE COMPANY) over 2 years ago
The "2007 real estate forecaster report card" By Matt Carter Inman News hopefully will help to guide us.    
Posted by James Wong Richmond Realtor (Sutton West Coast Realty, BC) over 2 years ago

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