I recently wrote about Robert Shiller’s unusual, for an establishment economist, ability to see the forces that influence market prices. He is also an expert on housing prices, as co-creator of the Case-Shiller index of housing prices. In an article in the June 6, 2008 New York Times, “Why Home Prices May Keep Falling”, he [...]
Entries Tagged as 'Housing'
Robert Shiller Expects Housing Prices to Continue To Fall
June 8th, 2009 · 1 Comment · Economics, Housing
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Efficient Markets versus Irrational Exuberance
June 8th, 2009 · 1 Comment · Economics, Federal Reserve, Housing, Regulation, Stock Market, Wall Street
Today’s New York Times has an article entitled “Poking Holes in a Theory of Markets.” Joe Nocera, the author, interviews Jeremy Grantham and several academic economists. The article makes what is now an obvious challenge to the theory of “efficient markets,” the theory that markets accurately reflect at all times the best possible valuation of [...]
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Hedge Funds Betting on Housing Collapse May Get AIG Cash
March 18th, 2009 · No Comments · Bailout, Banks, Bonds, Credit Default Swaps, Debt, Default, Economics, Federal Reserve, Financial, Global Economy, Housing, Interest rates, Mortgages, Policy, Regulation, Stock Market
The Wall Street Journal has an article that describes in some detail how hedge funds and Goldman Sachs bet on the collapse in the US housing market using hundreds of billions of dollars of credit default swaps, swaps that eventually were bought by AIG for pennies per year. In the event, when the housing market [...]
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The AIG Bonuses Are Not the Problem
March 18th, 2009 · 1 Comment · Bailout, Banks, Bonds, CDS, Credit Default Swaps, Federal Reserve, Financial, Housing, Nationalization
The exploding outrage over the hundreds of millions of bonuses paid by AIG to the traders whose actions created the financial meltdown is completely understandable and appropriate. Unfortunately, though, it appears to have distracted the media and the public from a far more grievous aspect of the AIG fiasco.
AIG has finally, under pressure, released [...]
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What Constitutes an "Optimistic" Outlook?
March 15th, 2009 · No Comments · Autos, Economics, Global Economy, Housing, Stock Market
I was struck by a recent post on Naked Capitalism, Looking for the Sun. The opening lead starts out,
2009 will be a grim economic year. The unemployment rate will rise all year, house prices will fall, commercial real estate (CRE) will get crushed … but there might be a few rays of sunshine too.
What struck [...]
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Long Perspective on Home Prices — Still a Long Way To Go
December 31st, 2008 · 1 Comment · Debt, Economics, Financial, Global Economy, Housing, Interest rates, Stock Market
Yale economist Robert Shiller is best known for creating, along with Chip Case, the Case-Shiller Home Price Index. This index is felt by many to provide the best indicator of prices for buying and selling existing (not new) homes. The index has been much in the news of late because it has been featured in [...]
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