Greenspan speaks on `housing bubble'

[dArKeR]

BLOOMBERG
Thursday, Aug 26, 2004,Page 12

Federal Reserve policy makers don't have the data to accurately tell whether US home values are overheating, Fed Chairman Alan Greenspan said in a response to a lawmaker's questions about the potential for a housing bubble.

"House price increases have outstripped gains in income and rents in recent years," Greenspan wrote as a follow-up to his July 20 congressional testimony. While that "raises the possibility that real estate prices, at least in some markets, could be out of alignment with the fundamentals," he added "that conclusion cannot be reached with any confidence."

"House prices are difficult to measure given the enormous heterogeneity of the US housing stock" and because existing data "are not fully adequate," Greenspan said in the letter released today by Senator Richard Shelby, an Alabama Republican.

http://www.taipeitimes.com/News/worldbiz/archives/2004/08/26/2003200302

[AndyTiedye]

1. Translation: Won't Raise Rates much Until the Election - Then WATCH OUT!

Stagflation, here we come...