El-Arian of PIMCO thinks to prevent a housing price collapse, either overnment must intervene or the mortgage contracts have to be altered. “There is no better alternative”, he said in a CNBC interview (watch below). Boy, that’s frightening! But I was more frightened by how a capitalist at such high level ditches market-based solutions so easily.

Crude-oil futures surged above their inflation-adjusted high Monday, climbing $2.08 to $103.92 a barrel in New York Mercantile Exchange trading, amid a weakening dollar and indications that OPEC is leaning against an increase in output. The previous high of $103.76, in January dollars, was set in April 1980.

Bob Shiller on NY Times asks the question: why even most experts didn’t recognize the bubble as it was forming.

courtesy of NY Times