Monday, April 19, 2010

POP goes the bubble---Graphic on the rise of housing in our economy since 1963...Quite dramatic!

The housing industry represents a large portion of our economy.  Think of all the goods and services (hence jobs) that are dedicated, directly and indirectly, to building new houses.  It is quite a pipeline!  Question: Do we have an over-allocation of resources to the home building market?  This graph shows the vast increase in housing starts in the mid to late 1990's and accelerating in the 2000's.  Why the sudden surge?  It is still a subject of controversy (Govt policies towards homeownership, Federal Reserve loose money policy, Wall Street greed,  individual "greed", etc)  Do we need to implement policies to prevent the "too many eggs in the  housing basket"? What do you think????


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