Sh*ty News from Greenspan
Alan Greenspan former chairman of the federal reserve bank and US native economic genius warns that we could be headed for a second recession. Greenspan said that the slow in the economic recovery feels like a “quasi-recession” and the economy could take a downward turn if home prices continue to decline.
“We’re in a pause in a recovery, a modest recovery, but a pause in the modest recovery feels like a quasi-recession,” Greenspan said on NBC’s Meet the Press
With home sales falling for a second month and no more government tax credit for home buyers people are starting to get worried about recession 2.0. The last thing anyone in this country wants to do right now is return to the worst recession since the 1930s. According to Greenspan its all about home prices.
“If home prices stay stable, then I think we will skirt the worst of the housing problem,” Greenspan said. “But right under this current price level, mainly 5, 7 or 8 percent below, is a very large block of mortgages, which are underwater, so to speak, or could be underwater. And that would induce a major increase in foreclosures, foreclosures would feed on the weakness in prices, and it would create a problem.”