Central bank chairman Ben Bernanke said Thursday that the U.S. home mortgage market is still not functioning properly and more needs to be done to promote a recovery.

Bernanke spoke at housing conference held at the Federal Reserve. He said the government must do more to turn back the wave of foreclosures on homeowners unable to meet their monthly mortgage payments. More than 2.2 million foreclosures are expected to have occurred this year.

"Our housing market is under a lot of stress, both because of the adjustment going on because of the housing price correction, but also because the mortgage market is dysfunctional to some extent," he said.

What has become a global economic crisis was touched off in August 2007 by a wave of defaults in the sub-prime U.S. housing markets.  Both the Fed and the Treasury have initiated various programs to assist mortgage borrowers and recently mortgage interest rates have fallen to their lowest levels in several years.

Stock prices in New York fell Thursday amid rising uncertainty over whether congress will approve emergency loans for the Detroit-based U.S. auto industry. Making their second appearance on Capitol Hill in two weeks, the heads of the big three carmakers warned that without immediate assistance one or more of the companies could go bankrupt.

Money manager Lincoln Ellis says General Motors shares tumbled 15 percent amid renewed doubts about that company's viability.

"You're hearing so many conflicting messages [on the auto bailout]? There is also definitely uncertainty on the jobs report that is coming Friday," he said.

Market participants are anticipating a report showing a loss of up to 300,000 U.S. jobs in November.

The Dow Jones Industrial Average fell 215 points, or 2.5 percent, to 8,376. It was the first loss for the index in three days.

Oil prices were steady at below $44 a barrel. Reflecting plummeting global demand, oil is down nearly 70 percent from its July 2008 record high and is now at its lowest level in nearly four years.