The US economy is at risk of double-dipping back into recession, according to a leading economist, intensifying fears for the global recovery.Read the rest here.
Recent disappointments in American housing and employment figures suggest the world's biggest economy is at a tipping point, warned Robert Shiller. "Whether we call it a double-dip or not, I think there is a risk," he told Reuters.
The S&P/Case-Shiller index of US property values, which he co-founded, showed house prices dropped 4.2pc in the first quarter of 2011 against the previous three months, marking the biggest drop since the start of 2009.
A further fall in prices of up to 25pc in the next five years "wouldn't surprise me at all", Mr Shiller said, given the amount of unsold homes in the US and the thousands of people who are behind with their mortgages. Japan saw prices fall for 15 years, he noted.
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1 comment:
Mr. Schiller, can you give us an idea about how high the double-dip risk is, or are you too full of hot air?
Hint: Oil prices aren't high enough for a double dip.
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