Interest Rate Roundup

Monday, March 12, 2007

$225 billion in mortgage defaults ... 1.5 million foreclosures ... hundreds of thousands of workers in housing-related industries fired

Those are some "stab in the dark" estimates about the impact of the housing and mortgage bust, according to these two stories ...

Story #1
Mortgage Defaults May Reach $225 Billion, Lehman Says

Story #2
Foreclosures May Hit 1.5 million as U.S. housing bust deepens

On the other hand, this Wall Street Journal story (subscription required) takes the stance that the housing and mortgage carnage will not really spill over to the broad economy.

I've been talking about these issues for a long time, so I won't repeat all of my arguments here. Suffice it to say that I have been bearish on housing for more than two years, and that I don't see any reason to change that stance yet. I believe it's only natural to expect that the biggest housing bubble in U.S. history will be followed by a painful bust.


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