Shiller on housing fixes: a Great Depression primer
Specifically the pages on the Great Depression.
He says the U.S. has "to consider the possibility that the housing price downturn will eventually be as big as that of the last truly big decline, from 1925 to 1933, when prices fell by a total of 30 percent."
So far, Shiller believes, "actions that have already been taken are not impressive." He suggests thinking big.
Among the changes made to deal with real estate troubles during the Great Depression, he notes, was the formation of the Home Owners Loan Corporation "to sponsor loans for those having trouble making payments, replacing short-term mortgages — then typically five years with a final balloon payment that was often hard for homeowners to afford — with much more sensible 15-year ones that were fixed-rate and self-amortizing."