Effects of the Housing Bubble

Paper Summary:

The paper outlines the chronology of the fall of the rising housing market in 1990 to the boom and subsequent end of the housing bubble in 2006. The paper explains how sub prime mortgages were responsible for inflated housing prices and then predicts that the economy will punish this excess.

From the Paper:

"The main topic of conversation with friends and family in the late 1990's was the stock market boom. Every conversation started with the main stock to buy followed by the rush to log into a stock brokerage account and purchase the hottest stock, which assuredly would give a profit the next hour. After the tech bust in 2001, the topic of conversation has changed from the stock market boom to the housing boom. From 2001 until approximately the middle of 2006, the housing market has at least doubled, with places like Florida, California, and other parts of the nation seeing double-digit growth."

Sample of Sources Used:

• U.S. Census Bureau. 2005 American Community Survey. http://www.census.gov/hhes/www/income/medincsizeandstate.html
• L.A. Times. Chronology of the Housing Bubble. Online link not available.
• ThinkGeek.com. http://www.thinkglink.com/Federal_Reserve_Chairman_Alan_Greenspan.htm
• U.S.A Today. Record Foreclosures Hit Mortgage Lenders. http://www.usatoday.com/money/economy/housing/2007-03-13-foreclosures_N.htm
• The Housing Bubble Fact Sheet. July 2005. Dean Baker. http://209.85.165.104/search?q=cache:gPRtxHrmQfsJ:www.cepr.net/publications/housing_fact_2005_07.pdf+housing+bubble+recession&hl=en&ct=clnk&cd=2&gl=us

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