If a lag exists between the decline in the assets value, the recognition of such a decline, and the decision or need (as a result of the economic downturn that itself has lagged behind the real estate problems) to default, will we see as sharp a downturn in the red line in the next few months?Thursday, December 11, 2008
More Defualts Ahead?
The following chart (from Calculated Risk) depicts household real estate assets and mortgage debt as a percent of GDP:
If a lag exists between the decline in the assets value, the recognition of such a decline, and the decision or need (as a result of the economic downturn that itself has lagged behind the real estate problems) to default, will we see as sharp a downturn in the red line in the next few months?
If a lag exists between the decline in the assets value, the recognition of such a decline, and the decision or need (as a result of the economic downturn that itself has lagged behind the real estate problems) to default, will we see as sharp a downturn in the red line in the next few months?
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