See our own Andrew’s review of economist Robert J. Shiller’s new book The Subprime Solution, in The New York Observer.
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See our own Andrew’s review of economist Robert J. Shiller’s new book The Subprime Solution, in The New York Observer.
Accidental Blogger 
4 responses to “Bubble Buster”
Thanks for the shout-out Ruchira! The good news is that the book is short, readable, and very informative. The bad is that Robert Shiller thinks the housing bust will continue to slam the economy for a long time to come. I’d welcome feedback anyone cares to offer.
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Considering that several (like 5 out of 10) pages of my local paper’s main news section are taken up twice a week by “Sheriff’s Sale” announcements, even in a sleepy real estate market like Pittsburgh, I hate to think what this subprime mortgage crisis is doing all over the US.
How bad is it in Houston, Ruchira?
I will most definitely check out the book at my library, Andrew- thanks for a great review!
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Yes Andrew, great review. I agree with Shiller that the responsibility for the current crisis should not rest solely on lenders – predatory or otherwise. The get-rich-quick and get-everything-right-now mentality of Americans is to be blamed also to a large extent. During the news coverage of foreclosure stories, I have seen genuinely gullible and uninformed home buyers who fell for the twin lures of homeownership and “low” adjustable mortgage rates and homeowners who have fallen on hard times due to job loss or other catastrophes. But I have also seen middle class, middle aged people as well as thirty something couples with small kids and working two jobs, buying second homes for “investment” purposes. Some of these homebuyers who are now in crisis can blame their misfortune on deceptive, predatory lending. But many others must blame themselves for helping to create the bubble with their imprudent greed. One of the most valuable lessons one learns in life is to live within one’s means.
Sujatha: I am really not very well informed about the housing bubble situation in Houston. From the little that I have heard, it appears that while the foreclosure rate is probably comparable to the national average, the real estate market in Houston hasn’t been affected much by that. New construction is still thriving and home prices are steadily rising.
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Thanks very much for your comments Sujatha and Ruchira — and if you’re interested in exploring various U.S. markets, Shiller’s own Case-Shiller Index tracks them: http://macromarkets.com/csi_housing/MSA/san_francisco.asp
They don’t track Houston for some reason, but they do track Dallas, which has declined only about 3% in the past year, very low in comparison with Miami, which is down over 28% in the past year, or San Francisco, down about a quarter.
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