by Calculated Risk on 3/04/2007 06:07:00 PM

As an excuse for more discussion in the comments, here are the areas I suggested watching at the beginning of the year:

1) A credit crunch based on bad loans in the RE sector leading to another down turn in the housing market (and possibly in CRE and C&D too, later in the year),

2) the loss of several hundred thousand residential construction jobs,

3) less consumer spending based on falling MEW.

Here is my estimate of the impact of the subprime implosion on existing home sales.

After the first two months of 2007, most Wall Street housing forecasts are already - in the words of Nixon press secretary Ron Zeigler - "No longer operative."