This is a plain-English explanation of how we got into the current economic disaster that developed out of the economics and politics of the housing boom and bust. The “creative” financing of home mortgages and the even more “creative” marketing of financial securities based on American mortgages to countries around the world, are part of the story of how a financial house of cards was built up—and then suddenly collapsed.
The politics behind all this is another story full of strange twists. No punches are pulled when discussing politicians of either party, the financial dangers they created, or the distractions they created later to escape their own responsibility for what happened when the financial house of cards in the financial markets collapsed.
What to do, now that we are in the midst of an economic disaster, is yet another story—one whose ending we do not yet know, but one whose outlines and implications are explored to reveal some surprising and sobering lessons.
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Welcome to the Double Dip in Real Estate The great reflation trade of 2008 - 2010 and the Federal Reserve monetizing national debt -- buying U.S. Treasury Bonds via POMO -- has failed to prop up the real estate market from it's ghastly inorganic highs. The estimates on how far national home prices can fall vary, but the...... -
Reversion to the Mean: Real Estate to Fall Another 20 Percent Lots of people are making big bets, even betting with borrowed money at risk to their personal credit report (e.g. taking out a home loan on investment properties), on the long term direction of the real estate market. Real estate is always influenced by local trends, but on a...... -
How to Get Out of Trouble in the Real Estate Market If you invested in the real estate market recently and are now regretting that decision, there are a few ways that you can get out of financial trouble. For awhile, the real estate market was very solid and property values were going up. Many experts advised investing heavily in real...... -
Home Prices to Fall Another 30%: Analyst Who Called Crash Makes Bearish Call on Real Estate Several readers have emailed me over the past few weeks asking my opinion on the current state of the real estate market after my post on mark-to-market accounting practices. The gist of these questions went something like this: Is now the time to buy a house? Have we hit a...... -
Using A Real Estate Broker? This is a Money Mavens Network post, the first of many to come. This time, a number of the Mavens will be writing on the topic of using a Real Estate broker to sell your house. (We've not seen each others' posts before publishing, so any similarities are purely from......
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