Sunday, 2 December 2007

Falling Home Prices to Break Back of U.S. Economy

The intensifying mortgage crisis in America is about to drive 1.4 million more homes into foreclosure next year and push national property values down by at least 7 percent. As a result, city leaders are getting desperate.
The Standard & Poor’s Case-Shiller home price index shows that home prices dropped 4.5 percent from the third quarter of 2006. The past quarter saw prices decline at the fastest rate since the index was created.

Robert Shiller, the index’s developer, says homeowners face a historic downturn in the housing market and that the current market is “out of the range of historical data” because the boom itself was far beyond any for which reliable data exists. He says declining home prices in the neighborhood of 50 percent are feasible in many areas.

Back in 2004, the Trumpet warned that America was experiencing the biggest housing bubble ever: “We are truly in uncharted territory. Yet the U.S. economy has been perking along largely because it’s been propped up by the greatest housing bubble ever known. We’ve shown how that simply cannot continue. When it starts to unravel, it will likely lead to the biggest bubble bust in world history, hurtling the U.S. economy into chaos …. The shock waves could lead to a major global recession like we’ve never seen.”

The US economy breaks and we all suffer.
Alas !!!

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