I’m too lazy to look it up, but is anyone aware of any bubbles that didn’t overshoot to the downside after the bubble popped? The linked information indicates that we haven’t come close to overshooting. Yet, Americans still view homes as good investments. That’s not the usual mentality about a bubble asset after the pop.

On the other hand, if you are expecting big inflation, leveraging at low interest for a hard asset is a good investment strategy. For most Americans, it would be hard to get better interest and better leverage on a hard asset than buying a home. Is that it? Is that the fundamental difference? Is it really different this time? Or, and I would have less faith in this line of reasoning, are our political and economic leaders going to halt a popped bubble from popping all the way? Is that even possible? Is everyone hoping for big inflation?

Note, that Felix Salmon link is probably better than the main link. I was actually looking for a different article on the “homes are a good investment” bit. He also makes a similar point, but with more words.