Collapse of the Housing Market Predicted

Ron Paul Predicts a Collapse of the Housing Market
By Edward Welch

Earlier this year, Ron Paul wrote an article wherein he predicts a collapse of the US housing market. His perspective is unique in that he’s placing the blame for this housing market collapse squarely on the shoulders of the Federal Reserve. Take a look at what Ron Paul had to say in his article – Don't Blame the Market for the Housing Bubble (Reference One):

"The U.S. housing market, long considered vulnerable by many economists, is now on the verge of suffering a serious collapse in many regions. Commodities guru and hedge fund manager Jim Rogers warns that real estate in expensive bubble areas will drop 40 or 50%. Mainstream media outlets like the New York Times are reporting breathlessly about the possibility of widespread defaults on subprime mortgages.”

While Dr. Paul is expressing his concerns of an inevitable collapse in the US Housing Market – the thrust of arguments point toward the federal intervention of the Federal Reserve as being the main source of the problem. This is completely consistent with his views that federal intervention – of almost any kind – is not Constitutional. In the same article (Reference One), Ron Paul considers the Federal Reserve to be too liberal in its lending:

“But capitalism is not to blame for the housing bubble, the Federal Reserve is. Specifically, Fed intervention in the economy – through the manipulation of interest rates and the creation of money – caused the artificial boom in mortgage lending.”

Earlier this week, in an article by the New York Times (Reference Two), three officials of the Federal Reserve said that serious problems in the housing market are a threat to the economy. This is exactly what Ron Paul had predicted a few months earlier this year. Although the Federal Reserve doesn’t seem to be blaming themselves for the housing market collapse – I doubt they ever would.

Regardless, it seems the Ron Paul has been quite accurate in his assessment and prediction of the housing markets.

E Lawrence Welch

References:

Reference One,
Don't Blame the Market for the Housing Bubble,
By Ron Paul,
Link – Don't Blame the Market for the Housing Bubble

Reference Two,
New York Times,
Link – New York Times

Mr. Welch received his formal education in the area of Finance & Accounting from Oklahoma State University. Since that time, he’s added numerous areas of expertise to his repertoire – including politics, marketing, search engine optimization (SEO), online retail, general business, computer programming, international trade, marriage, love and more. His new blog is Financial Pizza. He also owns and operates an online retail holster store Pyle Mountain Holsters.

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Ron Paul for President 2008