Political Pistachio

Blog Home of the Writer and AM and FM Radio Host, Douglas V. Gibbs.
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Sunday, June 19, 2011

U.S. Housing Woes Worse Than Great Depression

It's official: The housing crisis that began in 2006 and has recently entered a double dip is now worse than the Great Depression.

Prices have fallen some 33 percent since the market began its collapse, greater than the 31 percent fall that began in the late 1920s and culminated in the early 1930s, according to Case-Shiller data.

The news comes as the Federal Reserve considers whether the economy has regained enough strength to stand on its own and as unemployment remains at a still-elevated 9.1 percent, throwing into question whether the recovery is real.

"The sharp fall in house prices in the first quarter provided further confirmation that this housing crash has been larger and faster than the one during the Great Depression," Paul Dales, senior economist at Capital Economics in Toronto, wrote in research for clients.

CNBC

Note: This crash was the result of sub-prime mortgages and other practices encouraged by Democrats, including those policies set forth by the Community Reinvestment Act that was initiated by Democrats during the Carter Administration, and doubled-down on during the Clinton Administration.

Also, the GOP saw this crash coming and sought to regulate the GSEs (Fannie Mae and Freddie Mac), but the Democrats accused the Republicans of fear mongering, and refused to regulate the GSEs as recommended by the GOP.



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