Housing, as an asset class, saw tremendous appreciation from 1998-2005. The appreciation was quite frothy. It was enabled by excess liquidity in our monetary system, loose practices in the lending industry and unrealistic expectations for long-term growth in real property markets.
Other classes of assets, cars, credit cards, etc., I don’t think we saw these kinds of conditions, growth expectations, behavior, etc. I can’t be sure if this is the explanation because I don’t work in the industry anymore, but this would be my outsider’s guess.
Curious, what’s your POV?
What’s your POV on the impacts of all this? In particular, how about the larger question of what happens to leveraged positions when asset values fall and revenue streams are diminished?
