In this Fox Business News interview, Prof. Robert Shiller comments on the current state of the housing market, the impact of the upcoming expiration of the $8,000 home purchase credit, and prospects for a price recovery over the next several years. Prof. Shiller is one of the economists who developed the Case-Shiller home price indices which are often cited in media reports covering housing prices.
Prof. Shiller recently published The Subprime Solution, a book regarding the housing bubble. The book contains a number of suggestions intended to reduce the impact of volatility in housing prices. One of the unconventional approaches discussed in the book is the concept of home equity insurance. Such insurance would be intended to protect against a decline or elimination of home equity in the event that a home owner needs to sell the home or refinance during a period of depressed prices.
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