Now that he has a book to sell (and a record to defend) Alan Greenspan is speaking a language his fellow countrymen can understand. His thoughts on the housing market? We’re screwed:
Greenspan said in an interview with Austrian magazine Format that low interest rates in the past 15 years were to blame for the house price bubble, but that central banks were powerless when they tried to bring it under control.
“It’s a difficult situation, there is an enormous overhang on the real estate market,” Greenspan was quoted as saying. “Many buildings which just have been finished can’t be sold …”
“So far, prices have dropped only slightly. But it was enough to cause alarm around the world,” he said. “Prices are going to fall much lower yet.” (Reuters)