$1 Trillion In Real Estates Losses Are "Tip of the Iceberg"

May 7 (EIRNS)--Realty fund manager Kenneth Heebner has estimated to Bloomberg that losses in U.S. real estate bubble collapse "will approach $1 trillion--that dwarfs anything that has ever happened"--in a home price drop of up to 20%, market by market, during 2007. Heebner says hedge funds, not investment banks or brokerages, will take the bulk of those losses over a period of time, and this will create a massive pensions crisis because pension funds are the big-volume sucker-money pouring into hedge funds,-- which is true. Henry Liu in Asia Times just published essentially the same estimate.

Lyndon LaRouche has said that the true extent of losses is being hidden to such an extent, that no such estimate being made, however high, can be considered an exaggeration.

Such figures are backed up by the fact that New Century Financial's loans and mortgage-backed securities are starting to sell off at 30 cents on the dollar; $170 million worth were bought by Ellington Management Group hedge fund for $51 million. The total mortgage-backed securities market has been estimated at $1.5 trillion.