Thursday, July 31, 2008

Greenspan Covers His A$$; Mortgage Applications Down. Shocker.

Former Federal Reserve Chairman Alan Greenspan said falling U.S. home prices are ``nowhere near the bottom" and the resulting turmoil shows no signs of abating. Ya think?

Bloomberg reports that the Mortgage Bankers Association index of applications fell 14% last week. This is the lowest level since the year 2000. And refi applications fell by 23%, also the lowest level since 2000. Tighter lending standards and falling property values are keeping prospective buyers out of the market and may extend the three-year housing slump. The decline in house prices, in turn, is making it difficult for homeowners to refinance their mortgages. Vicious circle.

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