Robert Shiller Tells Fox Business There Is "A Real Possibility Of Further Decline" In The Housing Market

Case-Shiller Index co-author Robert Shiller spoke with FOX Business Network's (

) Connell McShane and Dagen McDowell about the company's report out today indicating home prices fell by 1.1% in February. Shiller said he is “pessimistic” and believes that home prices could go down “much more” than the predicted “five or ten percent decline.” Shiller also addressed tomorrow's Federal Reserve press conference saying “I think it's a good thing the Fed Chairman talks to the people and not keep secrets.” Highlights can be found below, courtesy of Fox Business Network.

“I'm not sure I can explain it all. These markets are mysterious. It can be speculative on the upside and the downside. I am on the pessimistic side. Usually they don't predict more than a five or ten percent decline. I think we could go down that much more. But I am not sure. It could be even more. This is a turning point in history. We have been through this big crisis, the markets are being supported by Fannie Mae and Freddie Mac right now and FHA, and we are talking in congress of either shutting them down or scaling them back. It's too uncertain right now. There has to be a real possibility of further decline.”

“Historically the stock market and the housing market have never correlated. That's why I have been saying for many years the housing market is a good investment because it diversifies. I am sure there are still good investments in real estate right now. Uncertain but as a diversifying thing.”

“The Fed is only so powerful. I give them credit for trying. The problems are deep seeded and they are not just in the U.S.”

“I think it's a good thing the Fed Chairman talks to the people and not keep secrets.”