For the most part, the housing market doesn’t require substantial in depth analysis. There are relatively few variables to consider. On the other hand, capital markets have hundreds of moving parts that require serious brain power to analyze.

No doubt, there are plenty of amateurs and idiots on wall street, but for the most part, there are many sharp, Ivy League types that try to outsmart the competition and therefore create fairly efficient markets. The creation of derivitives by math whizes is what allowed the housing bubble to occur. The real estate folks were simply going along for the ride.

Take a look at the housing market and you find very few Ivy League educated Realtors and Mortgage brokers – just kids from a brain power standpoint. Order takers.

The housing market is a cute playground that allows some to feel smart and important… paint the house and add a room because that will sell the house… yes, an ARM is a great mortgage for you…