Economists say that high gas prices triggered the housing crisis in 2007 (2012)
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Economists say that high gas prices triggered the housing crisis in 2007 (2012)
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Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)
#2Too right, they did. As a peak-oiler at the time I paid close attention to the run-up to $150 and the financial crisis that followed.
And now fear we're in for a replay.
Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)
#3Now we have high oil prices (not yet at the high) also with general (corporate induced) inflation, combined with an even greater separation of wealth. All things that point to a a recession again. But war is the variable here.
Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)
#4> "The key word is, 'triggered,'" said JunJie Wu, an OSU economist and one of the authors of the paper. "This theory recognizes the role of subprime mortgages and lax lending practices as inflating the housing bubble, but high gasoline prices provided the trigger that burst the bubble."
Are we in another bubble? And if so what is the theory for why? I assume subprime and lax lending wouldn't be the cause after the lessons learned from last time
Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)
#5Now we have high oil prices (not yet at the high) also with general (corporate induced) inflation, combined with an even greater separation of wealth. All things that point to a a recession again. But war is the variable here.
> (corporate induced) inflation
Why did the corporations wait for the government to print tons of money to decide collectively to raise prices?
Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)
#6> "The key word is, 'triggered,'" said JunJie Wu, an OSU economist and one of the authors of the paper. "This theory recognizes the role of subprime mortgages and lax lending practices as inflating the housing bubble, but high gasoline prices provided the trigger that burst the bubble." Are we in another bubble? And if so what is the theory for why? I assume subprime and lax lending wouldn't be the cause after the le…
Canada’s housing bubble didn’t pop a decade ago, and continued to inflate.
Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)
#7> "The key word is, 'triggered,'" said JunJie Wu, an OSU economist and one of the authors of the paper. "This theory recognizes the role of subprime mortgages and lax lending practices as inflating the housing bubble, but high gasoline prices provided the trigger that burst the bubble." Are we in another bubble? And if so what is the theory for why? I assume subprime and lax lending wouldn't be the cause after the le…
Canada’s housing bubble didn’t pop a decade ago, and continued to inflate.
Housing in the Toronto area has been even more insane than usual the last few months. Houses an hour away from downtown that were selling for ~850k in November 2021 were selling for $1.05M in January and February.
Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)
#8Now we have high oil prices (not yet at the high) also with general (corporate induced) inflation, combined with an even greater separation of wealth. All things that point to a a recession again. But war is the variable here.
> (corporate induced) inflation Why did the corporations wait for the government to print tons of money to decide collectively to raise prices?
Did you notice there was a multi-year pandemic that destroyed supply chains and greatly increased labor costs?
The causality is not as simple as “governments printing money -> inflation”.
Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)
#9> "The key word is, 'triggered,'" said JunJie Wu, an OSU economist and one of the authors of the paper. "This theory recognizes the role of subprime mortgages and lax lending practices as inflating the housing bubble, but high gasoline prices provided the trigger that burst the bubble." Are we in another bubble? And if so what is the theory for why? I assume subprime and lax lending wouldn't be the cause after the le…
Not a bubble because for the most part people are buying homes that they can pay the mortgage on.
High energy prices are also going to spike inflation which eventually means rates rise. If that happens owners with their 2.75% mortgages aren't going to be inclined to sell. Coupled with higher new construction costs the housing market probably continues to rise.
Re: Economists say that high gas prices triggered the housing crisis in 2007 (2012)
#10Now we have high oil prices (not yet at the high) also with general (corporate induced) inflation, combined with an even greater separation of wealth. All things that point to a a recession again. But war is the variable here.
I don't have the figures handy, but based on what I am seeing I suspect we are entering a period of the biggest wealth gap in recent history between the rich and everybody else.
Massive, massive asset inflation, for those that own things - and the bigger and more you own, the more you have benefited, and then massive inflation in consumer/everyday products like food, energy and clothing and for those seeking to buy their first house, as well as renters finding out the rent is being jacked up rapidly - i.e. the people who can afford inflation, are seeing massive gains in their asset portfolios, and the people who can least afford it - are on the verge, if not already at, a disaster in the personal economic situation.
We are heading for a train wreck of massive proportions imo, best to get prepared if you can.