tag:blogger.com,1999:blog-4159906646513306121.post6636654891873770623..comments2023-11-19T20:38:50.237-08:00Comments on Economic Logic: Economists did see the bubble comingEconomic Logicianhttp://www.blogger.com/profile/10171296292101248614noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-4159906646513306121.post-70246471211726074412011-05-01T11:02:33.937-07:002011-05-01T11:02:33.937-07:00If you consider that off balance sheet banking was...If you consider that off balance sheet banking was permitted at Basel 2 in 1998, you know that the Fed had it's marching orders from Basel and nothing was going to stop the securitization ponzi. If they had to lie they would lie, as the predatory lending gripped mainstreet and the banksters got wildly rich.Gary Andersonhttp://www.businessinsider.com/author/gary-andersonnoreply@blogger.comtag:blogger.com,1999:blog-4159906646513306121.post-15745634106044058762011-04-29T19:13:35.196-07:002011-04-29T19:13:35.196-07:00BR is right: The academics who called it early and...BR is right: The academics who called it early and called it right were generally not the 'barons' of the profession, but rather people at forecast and real-estate centers of California universities -- especially Ed Leamer and Christopher Thornberg of UCLA. <br /><br />'Anonymous' raises an interesting question though: Why did the only high-end scholarly paper poo-poo the possibility that home prices were getting alarmingly overvalued? Publication bias? <br /><br />As EL says: former NAR chief economist David Lereah notoriously fueled the bubble with his justifications for runaway price expectations. Check out his 2006 book, "Why the Real Estate Boom will not bust -- and how you can profit from it" . oops.Martha Starrhttps://www.blogger.com/profile/08421614642894985119noreply@blogger.comtag:blogger.com,1999:blog-4159906646513306121.post-30111850396284516832011-04-28T17:52:52.060-07:002011-04-28T17:52:52.060-07:00David Lereah has been the chief cheerleader of the...David Lereah has been the chief cheerleader of the real estate industry, trying to ridicule the academics calling for a bubble: <a href="http://en.wikipedia.org/wiki/David_Lereah#Criticisms" rel="nofollow">Wikipedia discussion</a>.Economic Logicianhttps://www.blogger.com/profile/10171296292101248614noreply@blogger.comtag:blogger.com,1999:blog-4159906646513306121.post-48095452447408576272011-04-28T11:22:51.910-07:002011-04-28T11:22:51.910-07:00EL.
Congrats on getting linked to by Mark Thoma. ...EL.<br /><br />Congrats on getting linked to by Mark Thoma. <br /><br />On the substance, yes, there were economists, and quite a few actually, who were raising questions, particularly starting in 2005, but it is also a fact that with the exception of Shiller they were largely unable to get much play at the commanding heights of the profession, or very loudly or clearly in the media.Barkley Rosserhttps://www.blogger.com/profile/13114257724762074636noreply@blogger.comtag:blogger.com,1999:blog-4159906646513306121.post-78809035015570279002011-04-28T05:38:37.078-07:002011-04-28T05:38:37.078-07:00Anonymous: you are citing just one example to supp...Anonymous: you are citing just one example to support your argument. What about the hundreds that Starr is using?Economic Logicianhttps://www.blogger.com/profile/10171296292101248614noreply@blogger.comtag:blogger.com,1999:blog-4159906646513306121.post-34045117813297912352011-04-27T23:29:56.359-07:002011-04-27T23:29:56.359-07:00I think that this is revisionist history. Very few...I think that this is revisionist history. Very few academic economists talked openly about the perils of the housing bubble (with Shiller being a notable exception). In fact in 2005 the Journal of Economic Perspectives (which often represents the consensus in the profession) published the now infamous paper by Himmelberg, Mayer and Sinai that said that there was basically little to worry about:<br /><br />http://www4.gsb.columbia.edu/null?&exclusive=filemgr.download&file_id=108171<br /><br />As far as I know the authors never published a mea culpa, showing us why they got it so spectacularly wrong.Anonymousnoreply@blogger.com