Close Stay up-to-date with
Observer.com Newsletters
Sign up for Observer Newsletters!
RSS Feed
The New York Observer

Why The Housing Market Has To Bottom Out

View Story On One Page View Story On One Page Print This Story Print This Story Share This Story Share This Story
November 4, 2008 | 10:50 a.m.
Bob Knakal.<br /> (Geraldine Sargeant.)
Bob Knakal.
Geraldine Sargeant.

Massey Knakal chairman Bob Knakal, in his latest commentary, tackles the almost Zen question of why the housing market has to bottom out before the overall economy can get stronger:

Much of the consumer spending that has occurred over the last few years has been stimulated by the massive amounts of mortgage equity withdrawal taken by homeowners who have, essentially, used their homes as ATM machines. Additionally, the wealth effect of feeling as if they had massive equity in their homes created spending habits which fueled the economy. As these dynamics no longer exist, it is important for the housing market to bottom out in order for our economy to turn around. This is also vitally important because the value of mortgage backed securities and derivative products based on these securities cannot be accurately valued unless there is a high level of confi dence in the value of our housing stock.

More commentary here.

Post a Comment The Discussion

Gerilo lfruticulo

lexapro - lexapro buy cipro online - cipro buy celebrex - celebrex order nexium - nexium buy butalbital - butalbital doxycycline online - doxycycline codeine online - codeine valtrex - valtrex order zoloft - zoloft clomid online - clomid

Post a Comment
Not a registered user? Register here.
Don't have an Observer.com account? You can use your Facebook account instead.