Martin Bashir | July 24, 2012
>>> a bit of good news on the economy. new homes being built at a faster rate than at any time in the last two years. foreclosures down. and goldman sachs released a report calling the housing recovery strong. president obama is taking some credit while slamming mitt romney in the process. take a listen to this.
>> mr. romney's plan is to let foreclosures hit bottom. that's not a solution. that's part of the problem. so my administration has already helped more than a million responsible homeowners refinance their mortgages. i want to give every home owner a chance to save $3,000 a year, take advantage of historically low rates. that's an example of the difference in this election.
>> an msnbc contributor and former chief economic adviser to vice president biden. good to see you. in the first quarter of this year, you were telling us over 700,000 homes with mortgages under water are now above water due to price appreciation. the question has to be asked when you're sitting from the president's seat here, would that have been possible had foreclosures been allowed to bottom out as mitt romney has been recommending.
>> and if you were to take that tack now you still have lots of underwater mortgages, you'd be very unlikely to see more of that. it's a very impressive statistic, 700,000 formerly under water mortgages broke the surface. that is their homes are now worth more than their mortgages just because of price appreciation in recent months. now, there are many millions of homes out there still under water. my assessment of the housing market is it's more kind of bumping along the bottom, maybe a little bit of increases in prices and starts, but it does seem like it's really gotten to a place where you can, as you mentioned in some of these reports.
>> why? why are we seeing a little pressuring here?
>> i think for two reasons. one, you do have to give credit to pretty aggressive programs that helped people particularly in this very low mortgage rate environment. refinancing now is a great deal. that's part of it. also just look, time has helped to heal some of these corrections. but if you went the other route that governor romney is suggesting and allowed all these homes to sink under water, that would go in the wrong direction.
>> is there confidence looking forward . these are big ticket items, the largest investment most families will ever see.
>> i think it's going to help a lot. one of anvils around this economy's neck has always been the housing market . when you have very low interest rates , one of the ways to get traction with mortgage refinancing through the housing market . if prices are falling, you can't get that. a little price appreciation goes a long way.
>> overseas markets reacting, a little down. spain saying it expects to be in recession another year. moody's taking the step to -- at least a first step toward downgrading their credit rating for the country.
>> its outlook for germany. there are fears greece may leave the eurozone. add that to the calculation as well. when you look at this, a drag on the u.s. recovery, perhaps, and it's very key, of course, to an election that will largely be decided on the economy. what's your thinking?
>> look, you're going from a little bit of a bright spot to a dark spot. when it comes to europe, the way we have to think about it is this. there's not much we can do, u.s. policymakers to influence european policymakers. they are going to do what they are going to do. they kind of make a step forward and a couple steps back. what we have to do, as you suggested, look at the impact on our economy. it certainly isn't positive. there are head winds coming across the sea from europe. we can't sit on our hands. our policymakers can't sit there and say fiscal cliff, foreclosures, forget about jobs measures, let liquid ate, come their way, we have to take job measures, fiscal measures to offset those head winds.
>> next time we'll end on a positive note.