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How did we miss another bubble?

Economic Bubble

A friend pointed me to the following article recently:

Home Ownership in a Bubble: A Fast Path to Poverty?

The most fascinating for me is that this article by Dean Baker and Simon Baribeau was written in 2003! Were we all blind? How is it possible, especially here in California that we walked from one bubble (dot com) to another? The warning signs were all around us. Were we too greedy to resist temptation? Or we trusted “our economic” leaders too much?

Obviously, the feds took advantage of our love and desire for our own place and gave us tax breaks to lure us in. Tax breaks helped to stimulate the economy and the overall growth. But when stimulation became the over stimulation?

Posted by Artur Urbanski on 04/23/2008 04:36 AM

Comments (8)

economic bubble, home ownership

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8 Comments on How did we miss another bubble?

APR

2008

I'm a broker in Los Angeles, and yep, I agree. I had an uncomfortable feeling as I watched the average price tick higher and higher ... out of the reach of more and more buyers.

There weren't alot of blogs around in 2003. But there were by 2005. Dig around and read the archives at some of the notorious "bubble blogs" and you'll see agents arguing right and left there is no bubble, and that real estate prices never go down. Sigh.

Too much trust. The "man" got us again!

Artur, we must stay tune to the conditions that surround us. In addition, we must do our own DD.

We have recovered from other bubbles and hope we will recover from this one.

They just announced the possibility of a big tax cut here...I'm not sure whether it will really go through or not but they talked about an approval of a 30% cut on property taxes.

Cheryl, Donna, Frank, Gita, Neal - thank you very much for your comments. Yes, we definitely have to get better with our own DD. At the same toime if there is hype around us -it is very difficult tp determin wjhen it is tim eto chabge course. After all, people make tons of money in the beginning of each bubble.

This too shall past. Not to worry it will past. This time around maybe we should not take a nap (or at least not take a long nap on our conditions and surroundings).

You are right. The problem is we have tendency not learn from experience. We just walked into right after the dot com bubble! Thanks for your comment. How things are going in Stockton?

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