We have all heard so much about the housing bubble that I am sure everyone would answer yes to the question of was there really a housing bubble. And I am sure that some definition of bubble would make what happened in the U.S. housing market qualify as a bubble.
But how does it compare to other bubbles?
Prices may have fallen as much as 35% over a four year period. This was after prices had increased by perhaps 100% over a 15 year period.
This does not resemble any of the historical bubbles that people study. It is much less severe. I argue that it does not qualify as a bubble. It is a correction and it is a bear market. But it is not a bubble. That is hyperbole.
Gold had a bubble where prices went up 800% and then came down 75%.
The NASDAC index went up 150% in a couple of years and then down 70%.
Those sound like bubbles.
Down 35% just doesn't measure up. Calling it a bubble is just propaganda.
It is just a bear market.
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