"We just had this huge, huge ten-year party," Greene said. "I think that basically what Americans did was not live off their income; they lived off their assets...now we're cleaning up this mess, and I think the consumer is shell-shocked."
Greene expects it will be a long time before Americans are willing to jump back in and get leveraged again.
According to investor Philip Blumberg, who appeared on CNBC with Greene, the real troubles for the commercial real estate market have yet to materialize.
- Video: Greene on Why GDP Will Decline 3%-6% This Year
Blumberg, who is the CEO of Blumberg Capital Partners, said the real story is the outstanding debt in this market.
"Think about this: In the next three years, 2010 — that's when it really starts — to 2013, we've got about $300 billion in (commercial mortgage-backed securities), of which $70 to $100 billion is not refinanceable. But to put it in real perspective, on top of this is $1 trillion in bank loans written in the same timeframe, with the same dubious underwriting, coming due in that period."
Blumberg expects this wave of debt will be a "real blow to the belly of the banking sector."
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