The Giant Pool of Money
It’s clear that when I don’t have the energy to post, I should put up something about housing costs, and then my commenters will take it from there.
I’ve been listening to the This American Life’s piece about the housing bubble and crash, and it’s fascinating. As suggested by the title of the episode, The Giant Pool of Money, it focuses on the supply side of the mortgage business, how it was in everyone’s business to keep generating loans and not to ask questions about whether they were really good risks. It’s nearly an hour, and if you didn’t grab the podcast already, you need to stream it, but it’s worth listening to anyway.
May 21st, 2008 at 11:50 pm
I couldn’t agree with you more. I thought that episode was one of the best examples of just kick-ass explanatory journalism I’ve ever seen, read, or heard. It took someone like me, for whom economics is an impenetrable black box, and made it all crystal clear, without talking down to me. Stellar journalism.
May 22nd, 2008 at 6:19 am
Here’s a kind of useful take on where the money has come from, and why: http://www.atimes.com/atimes/Global_Economy/JE20Dj05.html
Spengler writes from a different perspective, but the ‘sausage’ metaphor is telling. We would all be better off if that investment had gone into alternate energy research, opening new platinum mines, etc., instead of marble counter tops in now-walk-away houses in Loudon County.
May 22nd, 2008 at 9:21 am
At least the marble countertops can be salvaged (perhaps by the foreclosed upon homeowners themselves). A lot of the other stuff is less attractive as a salvage item. (By the way, it seems that granite can put out radon. Who knew?)