Housing – Just How Bad Will it Get?
Just how far will home prices drop? Well, back when J.P. Morgan Chase swallowed up the collapsing Washington Mutual bank, they needed to figure that out.
Here are their projections from September 2008:
Under their worst case scenario, unemployment would hit 8 percent, and home prices nationwide would decline by 37 percent from the peak.
Now unemployment is at 9.5 percent and rising. That means prices nationwide will decline over 37 percent from peak! Prices in California will decline by over 58 percent from the peak, and prices in Florida will decline by over 64 percent from the peak.
This points to a couple of things:
1. Bank “earnings” are phantom earnings from bailouts. There are huge losses to come, and we’re not done with bailouts.
2. Home prices have a long way to drop still.
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July 18th, 2009 at 5:14 pm
errr Perhaps this video should have gone here.
Great video montage of Ben Bernake being asked about the possibility of the housing bubble in the run-up over a several years.
What Bubble?
Posted by Lew Rockwell on July 18, 2009 04:19 PM
August 26th, 2009 at 11:15 pm
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April 5th, 2010 at 6:20 am
I love looking back at these articles you nimrods wrote back when Obama took office. The Dow is gonna get crushed???? Ha. Dow is up 75% since the stimulus passed. If you want to see what destruction is you’ll have to look at the Bush years.