|
Greenspan Says U.S. Home Prices
May Stabilize in 2008
Scott Lanman and Lily Nonomiya
Bloomberg
Tuesday, April 8, 2008
Former Federal Reserve Chairman Alan Greenspan said the drop
in U.S. home prices will probably end ``well before'' early next
year as the number of houses on the market diminishes, aiding
an economic rebound.
``It will not be until early 2009 that we will get close to having
eliminated most of this'' home inventory, Greenspan told a conference
in Tokyo today sponsored by Deutsche Bank AG and co-hosted by
Bloomberg LP. ``But it is very likely that home prices will stabilize
well before that.''
Greenspan added that the extent of damage stemming from the collapse
of the subprime-mortgage market won't be known for months. He
described the credit crisis as the worst in 50 years, echoing
the assessment of International Monetary Fund economists.
(Article continues below)
``You won't see asset markets recover until housing prices stabilize,''
said Glenn Maguire, chief Asia-Pacific economist for Societe Generale
SA in Hong Kong. ``If Greenspan is correct, you'll see weakness
in the economy through 2008.''
The yield on the 10-year Treasury note fell 1 basis point to
3.53 percent as of 4 p.m. in Tokyo, according to bond broker Cantor
Fitzgerald LP.
Greenspan's successor, Ben S. Bernanke, and other Fed officials
have highlighted declining home prices as a major economic risk
that may further hurt household wealth and consumer spending.
`Slow, Hesitant Recovery'
``Once the markets start to stabilize, especially if the real
economies don't go into a severe recession,'' then ``we can expect
a recovery to begin to take place,'' Greenspan, 82, said via satellite
from Washington. ``It will be slow, it will be hesitant.''
The health of the U.S. housing market is tied to broader financial
markets that rely on bundling mortgages to sell as securities,
Greenspan said. The median price of an existing single-family
home dropped 8.7 percent in February from a year earlier, the
most in four decades of record keeping, according to the Chicago-based
National Association of Realtors.
Full
article here.
|
INFOWARS:
BECAUSE THERE'S A WAR ON FOR YOUR MIND
|
|
