Robert Shiller (and me) on housing

Posted by: Dean Foust on November 14, 2008

shiller2.jpgA shameless plug here that I participated in a 30-minute segment on the “state of the housing market” on NPR’s Talk of the Nation show yesterday, along with noted Yale economist Robert Shiller. Here’s a link to the audiocast, on the off-chance you weren’t glued to NPR all day Thursday.

At one point, I interjected and asked Shiller if he thought we were hurtling toward a depression. What prompted me to ask were comments Shiller had made in a separate interview recently where he was pretty bearish. On Talk of the Nation, Shiller seemed a little more hopeful that we can dig our way out this time — noting that after the Crash of 1929, the country had to wait three years for do-nothing Hoover to leave office and make way for FDR and his aggressive agenda to create jobs through public works programs. This time, we only have to wait another two months (though even that short delay could be enough time for GM and the other automakers to file bankruptcy first).

Photo credit: The National Post, which published an interview with Shiller in early October and which is recommended reading.

Reader Comments

Brian

November 17, 2008 12:44 PM

I am less hopeful than Shiller. His suggestion that Hoover didn't do anything to attempt to stem the Depression is without merit. Hoover was actually firm proponent of "fiscal stimulis"

http://article.nationalreview.com/?q=MTMwZDRhOTkzNmY5ZTAxNDA1YzRmZjA3ODRiYjM3OTA=&w=MA==

jdj

November 17, 2008 11:32 PM

Dean,

Why couldn't you tell the caller from Florida who wanted a bailout just because the value of her home had dropped that no one guaranteed her a profit.

I mean, c'mon, how many people are down 50% in their 401 (k) accounts and their is no bailout for them. What is the difference? People who have money in their 401 (k) actually are losing their own money compared to these people who put zero down on their house.

Thanks

Dean Foust

November 18, 2008 1:36 PM

Jon, You make a good point in your comment. I SHOULD have told the caller from Florida that no one guaranteed her a profit (the fact that I didn’t wasn’t me just being nice. The blessing and curse of live call-in radio is that you have to think on your feet, and in that case I wasn’t thinking quick enough).

Amazing how we’ve become a society where if something doesn’t work out, we expect someone else – the government – to cover our losses. Ten years ago I was robbed in NYC on a business trip and handed over $100 from my wallet to avoid getting beat up. My first thought after the incident was, “Who’s going to cover my loss?” And the answer is, why should anyone? (In the end, our office manager in Washington told me that since I was on business I could expense it—and she showed me a creative way to list it on my T&E. I took her up on her offer--who wouldn't--but admit now that I should be ashamed that my first instinct was that someone owed me something.)

Jeremy

November 24, 2008 7:10 PM

Hoover did not do anything? I believe there is a small public works project named for him out west some where. It was called Hoover bam, jam or something like that I think.

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About

BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.

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