U.S. Housing Market Seen Declining in 2006

The U.S. housing market will see a sustained decline next year, causing a drag on the nation's economy but falling short of triggering a recession, according to a new economic report.

"We expect housing to start slowing the economy this quarter or the next," Edward Leamer, director of the quarterly University of California, Los Angeles, Anderson Forecast, wrote in the report to be released later Wednesday.

The cooldown in the housing sector is likely to be spread over several years, with as many 500,000 construction jobs and 300,000 financial sector jobs lost, the report said.

"Some jobs in manufacturing might well disappear as a result of weakness in housing, but this may be offset by jobs brought home or not lost to foreign competition," Leamer wrote.

http://hosted.ap.org/dynamic/stories/E/ECONOMIC_FORECAST?SITE=FLTAM&SECTION=HOME&TEMPLATE=DEFAULT

here in NW Arkansas. Our company has to pretreat new construction sites. Used to be that these pretreats constituted the second largest segment of our income. This year it has slipped to third, behind quarterly pest services.

As debt gets more expensive, people can borrow less and less.

rates in a highly leveraged market such as housing can have a huge impact.

The Fed is going to keep raising until they get to 6 or 7%.

because people will no longer be able to pay even the interest on the artificially inflated value of the mortgage on their house.

to the falling housing market and high energy prices come together.

Maybe it was posted here. It was so amazing: the researcher claimed that fully 36% of the workforce was involved in the housing industry. She included mortgage lending, construction workers, even Home Depot employees. The list included millions of employees.

As I read the article, I realized that the U.S. has built an astonishing house of cards. The high housing prices are truly imaginary. When that house comes down, it's going to take a lot of people with it.

When our generations Great Depression hits, it's going to make the one in the '30's look like a hiccup. Without us buying a bunch of junk, look for the world economy to collapse as well. Unfortunately, we don't have the ability we had 70 years ago to get out of it. We are about to enter into a new Dark Ages.

Bush says our economy is booming bigger than it ever has been in our nation's history!:sarcasm: