Housing Bubbles & Deceit
HOUSING BUBBLES & DECEIT
Hugh Pavletich FDIA
Performance Urban Planning
April 6, 2009
As William Black, a regulator during the Savings & Loans Crisis explains within this Video – the major cause of these financial crises are fraud and deceit.
It needs to be borne in mind, however, that the finance sector didn’t have a “monopoly” on this.
It’s been endemic through our land use regulatory systems for years as well – creating the bubble conditions that provided the foundation (scarcities and perceived scarcities), for the widespread perception that inflating house prices would continue forever.
The deceitful behavior infected pretty much most communities –other than the 77 major urban markets identified within this year’s 5th Annual Edition : Demographia International Housing Affordability Survey .
And the Authorities played it for all its worth – as they of course welcomed the bubble revenues with open arms.
California is a lesson when things go in reverse.
Did many care about the young and poor people who were denied their right to the opportunity of home ownership and affordable rental homes, while these bubbles were inflating?
Did many care when young and poor people were saddled with household debt of 4, 5, 6 through to 11 (Herb Greenberg - Mortgage Mess) times their annual household earnings – when they should have just 2.5 times annual income mortgage on homes that didn’t cost them any more than 3 times their annual household earnings.
They do now on the trip back to reality - and of course – its everybody else’s fault – other than their own.
There are failings of commission………and omission, of course.
There was once a quaint theory that if there was an “obvious wrong” – people with integrity were duty bound to do whatever they could to put it right.
Isn’t it interesting how every generation seems to have to relearn history…………….the hard way.