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Subject:  Re: Putting the housing downturn in perspective Date:  3/14/2008  11:27 PM
Author:  mandrake66 Number:  35539 of 501

I think your estimates sound reasonable (10-15%, 24 months). The trouble I'm having with almost all estimates these days, whether it be housing inventory backlog, subprime writedowns, etc is that they're all discussed so one-dimensionally, when we're well into the reverberations from second- and third-order effects that are causing the equivalent of bank runs at hedge funds and Bear Stearns.

Just the housing problems we've had already, which seem only the tip of the iceberg, have nearly ruined the whole financial sector. I mean, my god, the student loan industry has virtually shut down. It's one thing to say the housing market will take 24 months to recover, and like I said, it sounds like a reasonable estimate to me. But what in the broader economy will be left standing by that point? And if the effects are that bad, will housing really be ready to rebound very strongly? What will the price of oil be? How devalued will the dollar be? I think a lot of things are up for grabs at this point in ways no one can get a handle on.


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