Keynoters See 'Tiny Bubbles'

Housing bubbles in the United States are following the Don Ho model, showing up only as "tiny bubbles" in local U.S. markets, according to two keynoters at the Predictive Methods Conference in Newport Beach, Calif.However, Doug Duncan, chief economist of the Mortgage Bankers Association, and David Lereah, chief economist of the National Association of Realtors, disagreed on economic growth. Mr. Duncan differed with Mr. Lereah's characterization of the current 3.5% pace of U.S. economic growth as anemic, arguing that the Federal Reserve Board has said this pace is the highest the economy can sustain without inflation. Mr. Duncan, delivering the conference's June 28 keynote address, predicted that 30-year fixed mortgage rates would not reach 7% till mid-2007. Mr. Lereah was the previous day's keynote speaker at the annual conference, which is sponsored by the Real Estate Information Professionals Association. REIPA can be found online at http://www.reipa.org.