Subprime mortgage loan defaults and excessive household and corporate debt represent a greater short-term threat to the U.S. economy than terrorism, energy prices or inflation, according to a new survey of economists.

Nearly one in three of members of the National Association for Business Economists surveyed in July and August said the housing boom can be described as “a serious national bubble.” Close to two in three economists surveyed cited easier credit standards as the number one or number two cause driving the housing boom.

Two years ago, only 14 percent of economists surveyed thought the housing boom could be described as a “serious national bubble,” and 34 percent thought easier credit standards were fueling the housing boom.

Most of the economists contacted for the most recent survey — 59 percent — still say there’s no national housing bubble, only “significant” local bubbles. Another 8 percent said there’s no bubble at all, and that the market is functioning correctly.

Asked to look five years into the future, 42 percent expected U.S. home prices to remain flat, 41 percent said prices should rise, and 16 percent predicted prices will fall. About three in four surveyed said they would buy a house today if they intended to use it as their primary residence, although 67 percent said they would not buy a second home.

Only one in five of those surveyed predicted a “meaningful” recovery in U.S. housing markets before the second half of 2008. About 38 percent expected a recovery in the second half of 2008, while 42 percent said housing markets won’t turn around until 2009 or later.

Most of those surveyed said they are concerned that the Wall Street securities that helped fund many of the riskiest mortgage loans — collateralized debt obligations (CDOs) — pose a threat to financial stability. They expressed similar concerns about hedge funds and credit default swaps (CDS).

CDOs are investments that may include mortgage-backed securities (MBS) — bundles of mortgage loans carved up into “tranches” with varying degrees of risk — along with derivative instruments that are designed to help manage the impacts of interest-rate changes, defaults and other risks.

Some hedge funds also have exposure to mortgage lending through synthetic CDOs that invest in derivatives such as credit default swaps instead of mortgage-backed securities themselves. Some hedge funds have seen their mortgage-related investments decline in value as home-price appreciation has slowed or reversed and borrowers default on their loans.

The resulting fear among investors has made it harder for mortgage lenders to obtain money to make loans, and many have gone out of business. Tightened credit standards have made it more difficult for some home buyers to obtain loans, potentially magnifying the downturn in some housing markets.

Although many of those surveyed by NABE hold advanced degrees in economics and other business-related disciplines, many said they have little or no familiarity with the structure, activities and risks associated with the methods used to finance many mortgage loans today.

About 68 percent said they were unfamiliar with credit default swaps and 51 percent knew little about CDOs. Another 48 percent said they were unfamiliar with asset-backed securities, which includes mortgage-backed securities.

More than half said they viewed guidance issued by federal banking regulators tightening underwriting and disclosure standards on nontraditional and subprime mortgages as “necessary and appropriate, but a little late.” Another 14 percent said the guidance didn’t go far enough, while nearly 13 percent called the guidance “irrelevant.” Only 7 percent said the guidance went too far.

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