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This morning from Bloomberg....
"U.S. stock-index futures extended declines after housing starts trailed economists' estimates in August, spurring concern that the real-estate slump will continue to weigh on growth. ...."
Trailed estimates??? What in tarnation lead anyone who calls themselves an economist to believe that housing starts would increase??? It's time these guys turn off Fox News and start doing their homework.
Private securitization of mortgages died last year. The Feds have Nationalized what's left of secondary marketing of the mortgage industry. No bank has any money to lend. Nada ... zilch... They're all trying to cover dirivitive spreads that looked like such a great deal, back in the day, and their CEO's are trying to hang onto their jobs.
When banks run out of money, they usually don't stop lending (Wachovia has). Instead they tighten their guidelines so that only the cream of the crop has any hope of qualifying for a mortgage. Why don't these "experts" figure this out for themselves?
There are plenty of buyers out there. No one can lend to them. Roubini says that Real Estate will plunge another 20% from today's levels. I think he's being too conservative. We can only hope that this administration wakes up and introduces a real housing bill and of course pray that it levels out at that point.
To put things in perspective, in the "Great Depression" real estate declined 30%. We have just passed the 20% mark and are sinking faster than ever.
Hey..Republicans...Write the President... oh wait...write Cheney instead.
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