[superadvisor]

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This isn't a "CNN Warning" it's from Jeremy Grantham. Jeremy Grantham is a very smart guy who has been bearish his whole life, so eventually he's going to be right, but the problem is figuring out when. He's a stopped clock.

But clearly Jeremy is at least partially right here. The resets on the bubble era 2 year arms is going to force even more housing inventory on the market which isn't going to be good for housing prices. My guess is the correction has one or two more years left.

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I agree it will take another 1-2 years for the housing market to correct itself. However, I do not believe this is going to have a major effect on the stock market at all, other than the occasional short-term selloff that will present great buying opportunities along the way.

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Could you give a little more explanation to your reasons behind this?

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Specifically, if you explain whether or not you agree with the following quote and if you believe that the quote would effect the over all economy:

"From these high levels, prices are guaranteed to fall. In doing so, they will reduce consumer borrowing and spending power. They will also increase mortgage defaults, most of which lie ahead, and lower financial profits and confidence."