Fri
08 Jul 2011
Pimco Exec Simon: What Recovery?
"We anticipate an average decline from here of about 6% to 8% in prices across the country... We see potential for a substantial number of foreclosures over the next three years – as many as 6 million to 7 million additional foreclosures, on top of the roughly 2 million we estimate have already occurred... Government has been involved in housing for some 70 years with pro-housing subsidies of all sorts... If we ended government support in all forms, mortgage rates could rise significantly... with potentially negative consequences for the market and also for the economy as a result of wealth destruction and consumer confidence declining... [T]he majority of losses have not come from {Fannie Mae and Freddie Mac's] core business: 20% down-payment, prime mortgages. They got in trouble because they expanded beyond their core business to maintain market share...[In] 10-to-15 years... the housing market should hopefully be on firmer ground...." - WSJ.com. More at BusinessWeek.com
Fri 08 Jul 2011 08:11 AM | Permalink |
Categories: Economy | Financing | Market | Value |
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