Bernanke to Face Housing Challenges as Incoming Fed Chair

Chris Isadore over at CNN Money has an article on the potential crisis’s that could face incoming Fed Chairman Ben Bernanke over the coming years. The article comes across very pessimistic, but I guess he is being paid to point out the worst possibilities that could face the Fed Chair. Here is Chris’s take on what could hurt the Bernanke concerning the housing market.

There is little disagreement among economists, builders and real estate execs that the white hot housing market is going to slow in 2006.
The question is whether it is a gradual slowdown or a more drastic, broad-based decline that sends home prices tumbling, rather than stabilizing or dipping gradually.
If it’s the former, there’s probably little for Bernanke to worry about. But if the so-called housing bubble does pop, it has potential to hit not just home sellers and builders but also the nation’s financial markets and the broader economy.
“I would attach a reasonably high probability that there will be a problem in the housing or finance markets that will test the next Fed chairman,” said Zandi.

Testing 1-2-3-4-5: Bernanke may face crisis in 2006 – Jan. 3, 2006.

Hat Tip : Boy in the Big Housing Bubble

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