Ex-Treasury Chief Summers Warns on Recession Risks

A recession is inevitable. It is the nature of any capitalist system. The questions is when and how severe:

Former Treasury Secretary Lawrence Summers said on Sunday the risks of a recession are greater now than at anytime since the September 11 attacks due to real estate and mortgage market troubles.

"I do not think we yet would have a basis for making a prediction that there will be a recession," Summers said.

"But I would say that the risks of recession are now greater than they've been anytime since the period in the aftermath of 9/11," he said on ABC's "This Week."

Summers headed the Treasury Department from 1999 to 2001. He resigned last year as president of Harvard University. In October, he joined a Wall Street hedge fund group.

For years, he said, the economy was bolstered by consumer spending, fueled by easy credit in a real estate boom.

With the boom over, he said, "those processes -- the rising housing market, the greater credit taken out of homes -- are going to go into reverse, to at least some degree. So I think the risks of a downturn have surely risen."