Paulson Says U.S. Hasn't `Hit the Bottom Yet in Housing' Slump

Discussion in 'Wall St. News' started by ASusilovic, Oct 30, 2007.

  1. Oct. 30 (Bloomberg) -- U.S. Treasury Secretary Henry Paulson said that the slump in the housing market in the world's biggest economy wasn't over yet.

    ``We haven't hit the bottom yet in housing,'' Paulson said today at a conference in New Delhi.

    The fallout from the U.S. subprime market has cost the world's biggest securities firms and banks more than $30 billion in bad loans and trading losses in the third quarter. Goldman Sachs Group Inc. Chief Executive Officer Lloyd Blankfein said at the same conference the housing crisis is a ``concern'' and he expects a regulatory reaction to the fallout.

    U.S. manufacturers fired workers for a 16th consecutive month in October, while declines in subprime-mortgage lending and homebuilding led to job losses at construction companies and financial institutions. Federal Reserve policy makers will lower the target interest rate again this week to sustain the expansion through the real-estate crash, economists said.

    Still, the U.S. economy was resilient enough to overcome the housing crisis, Paulson, a former head of Goldman, said.

    ``There is enough strength in the economy that we can grow through this,'' the official said. ``We have a strong global economy. We have a strong U.S. economy that is creating jobs every day.''

    Hank, thank you for the insight !:D
  2. Hank is an optimist.
  3. Mr. Shiller and someone from S&P showed up this morning on CNBC. Aside from the usual yadda about the hottest markets showing the steepest declines, they see a nationalwide bottoming in Q3 with a decline about 10% from the top.

    I think we ought to take up a collection for the doomsayers on here who like to lump the NYC area in with the 4 states who are seeing those big price declines. It appears these people still can't find anything affordable in the NYC area and are realizing apartment living to be quite deporable.
  4. I think certain areas will always be hot realestate no matter what kind of market is out there in general. People will always pay a premium for quality locations. It's the bubble markets that people need to be more concerned about.
  5. we still have $400 billion in resets coming, not all of which will default but a decent number will and that's extra supply onto the market....

    Q3 of 2009 maybe
  6. I think a lot of these lenders or debt-holders are going to do what CFC did, re-structure the ARMs on people who were in good standing up until the ARM re-set. They really don't want to take possession of all these homes.
  7. that's true, but a ton of the paper was bundled up into goofy structured CMOs and sold as AAA paper to who knows who.....

    the holders will expect a return...a pension fund in Germany wont sit down with some hamster in Barsto and work out a deal...
  8. Paulson is a toad

    Why anyone cares what he has to say is beyond me