The Mortgager and Mortgagee differ the one from the other not more in length of purse, than the Jester and Jestee do in that of memory. But in this the comparison between runs, as the scholiasts call it, upon all four; which, by the bye, is upon one or two legs more than some of the best of Homer’s can pretend to; — namely, That the one raises a sum and the other a laugh at your expense, and think no more about it. Interest, however, still runs on in both cases; — the periodical or accidental payments of it just serving to keep the memory of the affair alive; till, at length, in some evil hour, — pop comes the creditor upon each, and by demanding principal upon the spot, together with full interest to the very day, makes them both feel the full extent of their obligations.
That is Laurence Sterne, from Tristram Shandy, chapter XII.
Is this a post about who first predicted the mortgage crisis, or who predicted the first mortgage crisis?
Calculated Risk and Shiller may not be first but they were far ahead of most.
Don’t miss Wayne Booth’s essay “Thomas Mann and Eighteenth Century Comic Fiction,” tracing out the unexpectedly wide reach of Tristram Shandy.
In asking ‘who first predicted this crisis’ (for any crisis), you need to first decide whether you are going to exclude those who are perennial doomsayers. Otherwise I imagine you can find someone who ‘predicted’ the crisis twenty years ahead of time.
I personally will nominate Ron Paul, who ends up seeming rather prescient here, writing about a zero-down-payment mortgage bill back in 2004.
I agree with Ron Paul. Ive been in the market for a new house for some time “after saving 100k. for a down payment” only to be put in competition against thousands of people given easy credit through government programs (with nothing to lose), this artificially drove prices beyond what financialy responsible people are willing to pay. As soon as these people default, the better, then maybe we can get back to reality.
Sterne is highly appropriate here: delightfully wordy.
Please watch this video. We’ve known this has been coming for quite some time.
http://www.youtube.com/watch?v=Yul0nnilILw
Someone tell us when they are going to predict the same in the UAE and Saudi Arabia. From the article below it looks like there isnt going to be a mortgage crisis.
An interesting article just published by Arabian Business (Tuesday 7th October 2008) reports that “Middle East real estate markets will outperform all other regions over the next couple of years, with the UAE and Saudi Arabia leading the charge, according to a survey of investor sentiment released on Tuesday.”
For more information
http://www.arabianbusiness.com/533368-mideast-markets-to-outperform-rest-of-world
http://www.off-plan.com
Believing that there is still growth out there!
I predicted the housing bubble in September 2004 and in my thesis from March 2006 I predicted that the housing bubble would burst due to higher interest rates and lead to a credit crisis, financisal crisis and that a global recession was highly likely.
Read more:
http://www.jensks.com
There were economists predicting this bubble back in 1998.
Even Greenspan in 2002.
Its important to warn about a crisis, but predicting the bubble has to include the understanding of deregulation and interest rates…. else it is purely speculation.
Using charges of racism and threats to use CRA to block business expansions have enabled ACORN to extract hundreds of millions of dollars in loans and contributions from America’s financial institutions.
Other things that ACORN did as community organizers were agitate for higher minimum wages, attempt to thwart school reform, try to unionize welfare recipients who are obliged to work in exchange for benefits and organize voter registration drives.
I don’t know who predicted the mortgage crisis first, but the crisis itself was well anticipated by a friend of mine, who is an Austin real estate agent. In one of our discussions, he told me that there are many people who buy houses using easy credits, but the loan has indebted them beyond their possibilities.
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