Hi, PS. Thank you for posting more info about the economy and real estate of other posts as well.

But I do not think the US is heading for a recession even if the housing market will crash pretty badly soon. Housing market is similar to stock market in the case of speculation; its process is much slower though – speculators/investors profit from other speculators/investors. Many people made significant profit over the last 2 years. They won’t cut their spending and some may increase their spending. The homeowners whose home will depreciate are only part of the population. People like me who rent to live is neither a winner nor a loser in the housing game.

Housing counts for about 20% of the whole economy. Other sectors are doing well with adjusted 3% in the Q2 (not as good as the Q1). So my point is that only the downturn housing market will not cause recession. But if the energy situation gets worse again, say the oil is above $90, it would be a different story. Please correct me if I am wrong.

By the way, does anyone remember what happened to the economy and stock market during 1990-1995?