Photo: Yahoo Finance
Yale economics professor Robert Shiller was on Yahoo’s Daily Ticker with Aaron Task today talking about that today’s Case-Shiller home price index, which unexpectedly climbed 0.5 per cent year-over-year in June.Shiller famously predicted the last housing bubble and he is also the co-creator of the Case-Shiller index. So, with each new data point, everyone wants to know if Shiller thinks housing is heading up.
“Well it might be,” he said. “We seem to have upward momentum and we have confirmatory evidence and like NAHB housing confidence index.
“But you know we have lots of clouds on the horizon too.”
The dreaded “but.”
Some of the clouds he pointed to were the problems at Fannie Mae and Freddie Mac, which is propping up the housing market and supported by the government. He also made reference to the key macro issues like the eurozone crisis, the slowdown in Asia, and the oncoming fiscal cliff in the U.S.
Then again, the housing market could be like the stock market in early 2009 said Shiller. Months and years later prices could be way up. “That might happen again.”
“Unfortunately it’s not quite obvious,” he said. “History surprises you. We don’t know for sure.”
Watch the whole interview here: