US Mayors Warn Worst of Mortgage Crisis Ahead:
"'Today the foreclosure crisis has the potential to break the back of our economy, as well as the backs of millions of American families, if we don't do something soon,' said Palmer, a Democrat, who serves as president of the mayors group.
The Global Insight report forecast U.S. homeowners would see property values fall by $1.2 trillion in 2008, with almost half of those overall losses coming in California. California property values are expected to drop by 16 percent in 2008, the report said, costing the most populous state almost $3 billion in property taxes.
The report said the weakening U.S. property market would have knocked some $676 billion from home values, but another $519 billion in losses could be tied directly to the financial problems facing borrowers unable to meet escalating monthly mortgage payments."