Spain pledges economic stimulus

The housing bubble is global. Its impacts will, mostly via the credit crunch, be felt globally too.

BBC article on Spain

The government has admitted that 2008 and 2009 will be tough, with Span's GDP growth rate slowing sharply.

But it said Spain should return to GDP growth of about 3% starting in 2010.

Understatement. Spain is the Florida of Europe. The overbuilding was spectacular. While the greatest concentration of investors were British, the mania wasn't limited to them.

Easyjet specialized in flying people to their various investment homes. I wonder how that airline will do? (I like their business model, but it could be falling apart.)

I plan to start posting more and more articles on how the real estate downturn is having a global impact. There is no "its different here." 2009 is going to have the greatest drop in global home prices ever. We'll also see the greatest drop in National home prices too. If your area hasn't taken its medicine... its about to. Oh, some should do ok until the fall. But bond buyers have wised up.

Even Sallie May is having trouble organizing all of the FHA insurance. Remember their huge losses in the S&L crisis? Since the majority of 2008 home buyers have already forfeited their down payment, I see down payment requirements only increasing. At some point, no one will sign up to insure FHA loans. (Not yet, not even really that close to that point. But it will happen. Maybe in 2010?)

Interesting times ahead. This global downturn is past the point of being able to ignore. I'm curious to see if freighter rates stay low or if they can spike back up for Christmas.

Got Popcorn?
Neil