Listen to the episode for free online.
Besides the fantastic, narrative way it breaks down the mortgage crisis, one of the things I love about this episode (which I’m still finishing) is its focus on how nobody believed housing prices could possibly go down.
You have people whose entire income was built on the idea that since houses would always increase in value, the people at the center of the transaction didn’t matter, their money didn’t matter, and their behavior didn’t matter. forget about greed or fraud or denial; the economy rested incidentally on the thimble-sized assumption that home values will always rise because they just do.
The question I have is, if the appetite of the market hadn’t driven local brokers to such ridiculously fradulent depths—if for some impossible reason, income still mattered—how long would we have continued to operate under that false presumption that the bottom line always goes up, and that individual cases of greed and denial can’t really affect that bottom line?
