19 Jul 2013
Flash: Similarities with US financial crisis and Eurozone crisis? – Goldman Sachs
FXstreet.com (New York) - The Economics Research team at Goldman Sachs compares and contrasts the housing crisis in the US with the Euroarea crisis.
Housing adjustment: Complete in places, incomplete in others
“While a housing boom and bust lay at the heart of the US financial crisis, the role that housing has played in Europe’s sovereign crisis has been more mixed – for Spain and Ireland, housing also played a lead role in the crisis; for Greece, the decline in house prices was as much a consequence of the crisis as it was a cause of it; while, for Portugal and Italy, housing has been largely incidental to the crisis (at least so far).”
“Five years since house prices in Europe peaked, we analyze developments in Europe’s largest and most crisis-ridden economies – we find that the situation is marked more by its contrasts than its similarities.”
Housing adjustment: Complete in places, incomplete in others
“While a housing boom and bust lay at the heart of the US financial crisis, the role that housing has played in Europe’s sovereign crisis has been more mixed – for Spain and Ireland, housing also played a lead role in the crisis; for Greece, the decline in house prices was as much a consequence of the crisis as it was a cause of it; while, for Portugal and Italy, housing has been largely incidental to the crisis (at least so far).”
“Five years since house prices in Europe peaked, we analyze developments in Europe’s largest and most crisis-ridden economies – we find that the situation is marked more by its contrasts than its similarities.”