Greenspan Says Declining Housing Prices in U.S. Are `Nowhere Near' Bottom

[marmar]

from Bloomberg:




Greenspan Says Housing Prices Not Yet Near Bottom (Update3)

By Steve Matthews

July 31 (Bloomberg) -- Former Federal Reserve Chairman Alan Greenspan said falling U.S. home prices are ``nowhere near the bottom'' and the resulting market turmoil isn't showing signs of abating.

While the odds of a recession are 50-50, achieving stable markets will ``take a while,'' Greenspan said today in a CNBC interview.

After his comments, benchmark stock indexes declined further. The Standard & Poor's 500 Index slid today by 16.88 points, or 1.3 percent, to 1,267.38. The Dow Jones Industrial Average lost 205.67, or 1.8 percent, to 11,378.02.

The economy grew at a 1.9 percent annualized rate in the second quarter after expanding 0.9 percent in the first quarter, the Commerce Department said in Washington. Gross domestic product was revised to show a contraction in the final three months of 2007.

More Americans filed claims for unemployment insurance last week than at any time in more than five years, the Labor Department said. Fed policy makers have cut the benchmark rate to 2 percent from 5.25 percent since September, halting the reductions in June amid rising concern about inflation.

Fannie Mae and Freddie Mac, the largest sources of money for U.S. home loans, are a ``major accident waiting to happen,'' Greenspan said. ``The solution'' is the ``nationalization'' of the companies, he said. ......(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=aaZkP.moXYUY&refer=home

[MannyGoldstein]

1. Home Prices Are Still Twice What They Were In 1970

After adjusting for inflation. They are still very, very high by historical standards.

[KharmaTrain]

2. Thanks For All The "Good Advice", Al...

That's like a doctor who butchered your leg surgery saying "it'll feel better once it's amputated".

Real Al Translation: Get ready to bail out more of my banking buddies...hell, it's only money.

[arcadian]

3. Look on the bright side people! Today is looking way better than tomorrow!

n.t

[lonestarnot]

Woohoo.

Thanks!

[bigmoon]

4. What is wrong with lower housing prices?

Doesn't that make housing more afforable?

[librechik]

7. sure--unless you have a 600,000 mortgage on a house now worth 300,000

and falling.

[jwirr]

8. Depends on if you are the buyer or the seller.

[Clovis Sangrail]

9. nothing... as long as you don't own a home /nt

[Tandalayo_Scheisskopf]

5. My word. He has no shame.

Typical proto-Randian. It is really hard to not wish a spectacular, picturesque and horrible end for this clown. Really hard.

[jwirr]

6. Greenspan says nationalize WOW.

[roamer65]

10. Poor little Aynnie Rand must be rolling in her grave.

Greenscum is reportedly a big fan of that cow's scribblings.

[spag68]

13. You give her too much credit

actually more like drawings on a cave wall.

[DebbieCDC]

11. This from the man who said there was no housing bubble

Just a little "froth" in the housing market. :puke:

[Kittycat]

12. He would know. He's help conspire to set up the environment perfect for the failures

we're seeing now. The only problem is that they happened about 18mo too soon. Now they can't blame a democratic president for it.

[Sen. Walter Sobchak]

14. burn baby burn!

Home ownership should be enabled by reasonable housing prices and not eternal voodoo mortgages and it isn't an investment - it's shelter.

Shitty GI Bill specials (cheap suburban houses thrown up in the early 50's) are still going to $400,000 to $500,000 around here.

[Beregond2]

15. I am an economic illiterate,

but even I knew it was insane to buy a house at those absurd prices. I begged all my nieces not to be so foolish, but they wouldn't listen, and now they are all screwed.