It’s been 10 years since the financial crisis took the housing market
and the real estate industry
by storm. For those who lived through the financial meltdown from 2005-2010, life will never be the same. We will not forget the lessons learned. While banks and other financial firms share much of the blame for what happened, there are others who played a part. A few examples of other culprits include:
- A rather blind Federal Reserve Board whose leader commented in the fall of 2007 that housing market was just fine.
- Politicians who took campaign money from Fannie and Freddie and fought every effort by the Bush Administration to reign in the two mortgage giants. In an only-in-America moment, two of the most egregious examples were Chris Dodd (then Senator from Connecticut) and Barney Frank (Congressman from Massachusetts) who voted to protect Fannie and Freddie and yet had their names on the bill to reform the financial system (Dodd-Frank). Yep, you can’t make this stuff up.
- The leaderships of the National Association of Home Builders, the Mortgage Banker Association and the National Association of Realtors, each of whom were apparently blind to the disaster unfolding on the housing market as their members businesses soared—at least until they crashed.
Want to read a good book about the genesis of the housing crash? Read ” Reckless Endangerment
,” for a true, in-depth understanding of how the politicians and bankers worked hand-in-glove to drive the housing and financial markets into oblivion. Then, you’ll have a great understanding.
While there are few signs of a similar situation unfolding, the more the Federal and state governments try to stoke housing, the closer we could get to another crash.
Let’s trust that wiser heads will prevail.