We will point out a headline that caught our eye this morning on MSNBC.com: "Greenspan Sometimes Fumbles His Forecasts."

The article makes a plea for the financial markets to stop hanging on the former Fed chair's every word - because ol' Maestro isn't always correct in his forecasts.

Case in point: the real estate market.

Back in October of 2004, Sir Alan said, "A national severe price distortion (in housing) seems most unlikely in the United States."

Then he relents - a bit - in 2005: "There's a little froth in this market," but "we don't perceive that there is a national bubble."

Now that it is clearly apparent there was a national bubble in housing, Greenspan tries to brush away worries, saying earlier this month that, "This is not the bottom, but the worst is behind us."

Well, that's wishful thinking at its best. This past Tuesday, Beazer Homes USA Inc. posted a 44 percent decline in quarter earnings due to lower demand for new homes. In addition, reports MSNBC, "luxury home builder Toll Brothers Inc. forecast a 10 percent drop in quarterly construction revenue due to rising order cancellations. It sharply cut its production forecast."

"We continue to look for signs that a recovery is imminent but can't yet say that one is in sight," Robert I. Toll, Chariman and chief executive office of the Horsham, Pa.-based company, said in a statement.

He should borrow Greenspan's glasses if he wants to see that recovery.

*** Lila Rajiva sends us this note from Tamil Nadu, India:

"Not only are the happenings here varied across industries, they are also geographically diverse. Chennai prices and infrastructure are looking more and more attractive next to the skyrocketing real estate and moribund roads in Bangalore. But far-sighted companies are already looking past Chennai to smaller towns. There is a lot of potential here, since the growth that has taken place so far seems concentrated in the larger cities. Foreigners writing about the country sometimes forget that there are over a billion people here, and that most of them live in the countryside and in villages and small towns.

"Small, of course, is a very relative term. A small town in India can have a couple of hundred thousand people. And it can have wayward dirt roads and power shortages at the same time as it has cutting-edge technology.

"That's the case with Vellore. A dusty town ringed around by desolate, rain-worn hills; and until recently known mainly for its Christian mission hospital and college. Today, it's a bustling overcrowded educational hub, sprouting engineering colleges, the latest electronic gadgets, and a supermarket. World Bank money has poured in to refurbish the old fort from which the rebel Hindu prince Shivaji once fought the mighty Mughal Empire. The Vellore Institute of Technology, which gets 7000 applicants, has been featured in the Washington Post, and computer support and technical help abounds. Getting on the net was a cinch. It only took a quick call to a computer center that charged me a hundred rupees (less than three dollars) for the cable and the house call."

*** The AFP reported this weekend that a boom in ethanol use in the United States has led to a surge in corn prices and changed the landscape for farmers now producing for both food and energy markets.

"The Renewable Fuel Association said it projects total corn used for ethanol production to increase from 1.6 billion bushels in 2005 to nearly three billion bushels by 2015."

However, as we've said many times in these pages, ethanol is not the band-aid for our energy problems in the United States. For one, it takes 30 percent more energy to make ethanol than the fuel itself gives out, and as Lester Brown, president of Earth Policy Institute points out, the increased demand for corn pose a threat to "world food security and political stability."

"In some corn-growing states such as Iowa, Indiana, and South Dakota, completion of the (ethanol) plants under construction and those planned means distillery requirements would take virtually the states' entire corn harvest," Brown said in a research paper.

"The milk, eggs, cheese, chicken, ham, ground beef, ice cream, and yogurt in the typical refrigerator are all produced with corn and their prices could go up in the months ahead," he added.

Brown also told AFP: "Cars are now competing with people for the same agriculture commodity."

Bill Bonner is the President of Agora Publishing.  For more on Bill Bonner, visit The Daily Reckoning.