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Housing Slump Could Dampen US Economy

Make Money Online By Michael O'Sullivan

Courtesy of Alex (our valued member) Interesting currency story from Reuters %Õreenback tipped to rise as US economy slows% //www.nzherald.co. story.cfm c_id=167&objectid=10414720 The greenback will rise in 2007, even as the United States economy slows sharply, as Asian central banks continue buying the American currency to keep their own currencies down and their exports competitive, says a British research firm. based Lombard Street says a housing slump in the US will finally cause Americans to cut back on spending, while rising labour costs will prevent the Federal Reserve from cutting interest rates until the second half of the year.

Internet Business Opportunity Economic forecasters in Los Angeles warn of storm clouds on the horizon. At a time of rising interest rates, they see worrying signs in the nation's booming housing market.

But I believe that a global recession scenario, spurred on by a prolonged US housing slump and sharp "reverse equity withdrawal", is a far more serious risk for the local housing market. It could bring about significantly lower economic and middle class growth in South Africa compared with our base case forecast. Lower inflation in such a scenario would in theory be a positive, since it would theoretically allow the SARB more scope to cut interest rates and cushion the global blow to the local economy. But other considerations may restrict downward rate moves.

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Slumps are an inevitable part of the business cycle, but making it through your first one can be scary.

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When business is bad, many companies become turtles and pull in their heads and feet until the storm passes. Actually, a slump can be a good time to expand and to advertise. If the economy is difficult, many advertising agencies and even media outlets are anxious for new business, and you can get excellent rates for advertising. While you don%› want to expend too much, it can be a good idea to advertise when your competitors are pulling back.

Free Online Affiliate Program March 16, 2005 (AXcess News) Los Angeles - The U.S. economy is in an upturn, and many analysts predict a continued recovery. But economic forecasters in Los Angeles warn of storm clouds on the horizon. At a time of rising interest rates, they see worrying signs in the nation's booming housing market.

The takeover battle for ABN Amro began with a letter from a hedge fund with a heartwarming name. But behind The Children' fund world's most combative financiers, part of a network that has swooped down several times on companies and insisted on change. Fed Cuts Rates by Half Point The Fed cut the federal funds rate by a half percentage point to 4.75% up in financial markets that threatens to deepen the housing slump and drag down the entire economy. (Statement)

Auction Coin Money Paper U.S. retail receipts are up. So is factory production. Jobs are being created and the U.S. economy grew at a rate of nearly four percent last year.

Franchise Business Opportunity 2004 was a great year, says Edward Leamer, director of the quarterly forecast at the Anderson School of Management at the University of California, Los Angeles. He says the good times may continue for a year or two, but by 2006 or 2007, he thinks the U.S. economy may face some stormy weather.

Best Free Online Affiliate "The risks come from the housing sector. We have an over-inflated housing stock," he said. "We have very high levels of building, construction, repair work."

Blogging Money Thebillivard He says that even a modest cutback could send the country into recession, and he believes recession will probably come by the end of the decade.Home prices have gone up quickly in many parts of the country, including southern Florida, Washington DC, and parts of the northeastern United States. In southern California, housing prices have doubled in the last three years, fueled here as elsewhere by low interest rates that have spurred a frenzy of buying and refinancing.Advertisement

Best Home Based Business UCLA economist Christopher Thornberg says the rise in home prices totals $500 billion in California, and he says it gives homeowners a false sense of wealth."This is an enormous amount. In fact, it represents something on the order of $25,000 in terms of housing appreciation for every adult in the state," he explained.Some people are borrowing against the equity in their houses and are using the money for home expansion or other purchases.

Affiliate Marketing Program In parts of the country where housing costs are lower, cheap interest rates have fueled new construction. Edward Leamer says homebuilding in those areas has also helped to boost the nation's economy.

Money Site Thebillivard Com But U.S. interest rates are rising, pushing up costs for buyers, so nearly everyone expects the housing market to slow. Mr. Leamer says that if history is a guide, a future housing downturn will spell trouble through the whole economy.

Online Business Opportunity "In fact, we've had 10 economic downturns since WWII. Eight of them got started in the housing sector," he explained.

Pay Per Click Affiliate He says the United States has been the engine of global growth in recent years, as U.S. consumers have engaged in a worldwide buying spree, purchasing products especially from China and other parts of Asia. He says a weakening dollar and sagging U.S. market could slow global growth in just a year or two.

Cnn Money However, the economist sees a possible bright spot on the horizon. He says the lower value of the U.S. dollar against many currencies could spur demand for U.S. exports, and moderate the downturn.

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