Industry News

Real estate slowdown will be isolated

UCLA economists predict U.S. economy will defy recession patterns

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The near future of the housing market, in the eyes of economic forecaster Edward E. Leamer, is a case of mind over models. Several statistical models suggest the nation may be headed toward recession, but he disagrees. "The model has been leading us astray. It is not a real recession. It is a slowdown -- slower growth and weaker job formation," said Edward Leamer, director of the University of California, Los Angeles, Anderson Forecast, released today. "Our view is we're moving into uncharted territory." While there will undoubtedly be job loss in the housing sector with the cooling real estate market, Leamer said that the manufacturing sector "is not poised to contribute much to job loss," and most of the job loss in past recessions has been in the manufacturing sector. If economic conditions change and the manufacturing sector does see major job loss, "then we'll call for a more extreme outcome," Leamer said. Recessions have been somewhat cyclical, Leamer notes in the report, occurr...