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OftenBen · 2843 days ago · link · · parent · post: Larry Summers: Interest rates are at inconceivable levels, and we must confront what that means
For the benefit of those of us still in kindergarden (WRT Housing Finance History), what kind of resolutions are we talking about?Students of history will observe that these sorts of situations tend to resolve themselves with stunning rapidity.
Well, Burbank, Glendale and Pasadena retrenched 50-60% between 2007 and 2009. Housing developments in the Inland Empire went vacant. We tried to spend our way out of the recession. The argument now is will we ever turn off the tap? Because if we do, we're back in recession. But if we don't, we're all on welfare. Monopoly is a tough game to win when the bank covers not only everyone's rental payments but also everyone's property purchases.