“The collapse of the housing bubble will throw the economy into a recession, and quite likely a severe recession,” warned a July report by the Center for Economic and Policy Research.
‘A downturn in housing could mean more than 1.3 million lost jobs, Goldman Sachs Group Inc. predicts, bumping up the national unemployment rate by 1 percent and the unemployment rate in house-mad California by 2 percent. Those numbers don’t include likely job cuts in housing-dependent businesses, such as banking, furniture and building materials.
‘A final nightmare scenario: A federal bailout of the mortgage market is likely if housing crashes, the center predicts. So, if corporate pension funds continue to falter and this dire prediction does come true, the Feds could conceivably be holding your mortgage and your pension.’ (AP article).