The Menace of an Unchecked Housing Bubble

By Dean Baker

An unprecedented run-up in the stock market propelled the U.S. economy in the late nineties and now an unprecedented run-up in house prices is propelling the current recovery. Like the stock bubble, the housing bubble will burst. Eventually, it must. When it does, the economy will be thrown into a severe recession, and tens of millions of homeowners, who never imagined that house prices could fall, will likely face serious hardships.

read more

(Note: I do not agree with this article because it seeks to treat the housing market as a global or national market as opposed to a set of local and regional markets....however, Ithought it was interesting from a macro persective.--- Mr. Condo)