Second Housing Bubble in the US?

Here is a clip from PBS with Robert Shiller (Yale Professor and co-author of the book Animal Spirits which reasserts the necessity of an active government role in economic policymaking). The US economy maybe showing signs of a slow recovery but the housing market is still subdued. New data released yesterday showed a weak housing market. The S&P-Case-Shiller (named after the forementioned) home price index of 20 leading cities found that prices fell in January, for the sixth month in a row. The index is down nearly a third from its peak in 2006, before the housing bubble burst. And it’s just 1 percent above its low in 2009. Why hasn’t very low interest rates and low house prices attracted people into the market? – listen to Robert Shiller. It seems that the US housing market still has not bottomed out and, with high levels of unemployment and the memory of the last housing bubble, there is a wait and see attitude.

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