Here we go again: The U.S. is knee-deep in yet another colossal housing bubble—shocker! —blown up by the same tired financial tricks. Prices are soaring, not because of genuine supply and demand, but due to the magical effects of financialization. Decades of housing subsidies, down payment assistance, artificially low interest rates, money printing, and endless bank bailouts have transformed American homes from cozy havens into high-stakes financial assets. The scale of this distortion is off the charts.
What’s truly riveting—beyond the obvious bubble-bursting spectacle—is how everyone talks about it. From investors and NIMBYs (residents who oppose real estate development and infrastructures) to YMIBYs (residents who are pro-housing) and even the neighbor down the street, everyone’s got their own simplistic theory on home prices, each cheerfully backed by their own cherry-picked data.
Take a look at this gem from a Wall Street Journal article:
When the American property boom began in 2016, it was already clear to those paying attention that it had morphed into a bubble and was headed for a spectacular crash.
Naturally, the bubble only got bigger because no one wanted to face reality. Developers, home buyers, real estate agents, and Wall Street banks all chose to ignore the red flags. Developers cleverly hid their debt with the help of bankers and lawyers. Buyers who suspected the market was overbuilt kept buying. Both domestic and foreign investors were happy to throw money at developers, chasing after those juicy returns. […]
— Read More: thepoliticalmovement.com
