Shiller: Rent, Don't Buy | Newsweek Business

PERSONAL FINANCE
A Real Rally?
1/8/2009 12:00:00 AM
For the past quarter century, many individual investors followed a fairly simple investment strategy: set aside regular savings to invest, buy a diversified basket of holdings and ride out the occasional pullbacks by staying focused on very long term returns. That conventional wisdom generally paid off.
Know When To Hold 'Em
Daniel Gross 1/7/2009 12:00:00 AM
The Federal Deposit Insurance Corp. on Monday agreed to sell IndyMac, a failed bank it took over last July, to a group of sharp Wall Street operators. They're paying about $15 billion, leaving the FDIC with a loss of about $9 billion on the bank. The government will probably be glad to get rid of IndyMac after just eight months, as it would like to unload all the other failed companies and bad assets the Treasury Department and Federal Reserve has amassed. But there's reason to think they should wait awhile before selling.
ECONOMY
Savings and Moan
1/6/2009 12:00:00 AM
A good three years before the current financial crisis, some of the smartest thinkers on the economy—people like NYU economist Nouriel Roubini, Morgan Stanley's Stephen Roach, and billionaire and all-around economic oracle Warren Buffett—started pointing out to everyone who would listen that things were going very wrong. There were three major things that worried them: the unprecedented housing bubble, the fragility of ever-more-complex Wall Street relationships, and the savings crisis. In 2007, the housing bubble decompressed. In 2008, Wall Street unraveled.
BUSINESS
The Next Turn Down
Stefan Theil 1/3/2009 12:00:00 AM
As if Western governments and central banks weren't spending enough (some $7 trillion and counting) to prop up their sickly financial sectors and ailing economies, they are now having to bail out the rest of the world, too. In October, the Federal Reserve set up an unprecedented $120 billion credit line to Brazil, Mexico, Singapore and Korea to stave off a liquidity crisis in those countries. The European Central Bank has helped struggling Hungary with $7 billion, while Iceland and Latvia have stayed afloat only thanks to handouts from nations like Britain, Sweden and Germany. In December, the U.S. Treasury set up a joint $20 billion fund with China to keep global trade financed as Western bank loans to emerging markets dry up. All this comes on top of an accelerated pace of IMF emergency bailouts that have included, so far, Pakistan, Ukraine, Hungary and Iceland.
PERISCOPE
Turning Japanese: How Low Can Prices Go?
Christian Caryl 12/20/2008 12:00:00 AM
Comparisons between the United States today and Japan in the early 1990s just keep growing. The Japanese call that period the "Lost Decade," as it was marked by anemic growth, plummeting prices and the lingering death of insolvent banks. There was, however, one product everyone wanted: a safe. If you couldn't trust banks to hold your savings intact, why not do it yourself?
THE GLOBAL ELITE
The Power of Money
12/20/2008 12:00:00 AM