No, it can still be okay. The market is going to end up lower. And home prices are definitely going to end up lower. And credit will be tighter going forward. But these aren't necessarily bad things. Home prices were too expensive. Credit was too loose. So if they do it right it will be like taking bitter medicine: it won't be fun, but if it makes us better it will be a good thing. It might mean there won't be crazy bubbles in the future where people get rich doing nothing, but that's a good thing! Markets aren't suppose to always go up.
The problem, and I think the reason why people like Rubini have to be so dire and dramatic, is that some people (i.e., CNBC talking heads for one) don't get this. They think the market should just always go up; housing prices should always go up.
Think of it like a liver flush for the economy.
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The problem, and I think the reason why people like Rubini have to be so dire and dramatic, is that some people (i.e., CNBC talking heads for one) don't get this. They think the market should just always go up; housing prices should always go up.
Think of it like a liver flush for the economy.
- jim 2-11-2009 4:04 pm