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by baldajan 3013 days ago
That's one way of kick starting a recession I guess...
1 comments

Call me crazy, but I'm kinda hoping for a recession. Housing prices seem very tightly correlated with the economy boom. I'd sure like to see a nice correction back down to sane levels, so that some of us who've been saving for a long time, can finally afford to buy something.

Downvote of course if you're a current home owner.

It'd be nice if we could just build more housing, rather than hope for a painful recession to drop prices.
We did build more housing, far too much, in 2005-07.
OK, good point...
It doesn't hurt current home owners as long as they are not over leveraged. It doesn't necessarily help people without houses either. When there is a recession, credit could dry up. Most people in the US can't afford to buy without a mortgage. The solution to a housing crisis isn't a recession; it's more housing and better transportation. A recession hurts everyone and often hurts the poor harder than it hurts the wealthy.
A recession is part of an economic cycle to rebalance misused assets.

More housing isn’t the solution. Many House bubbles had ample housing for people to live in, but not enough for speculation.

Building more houses kicks the bucket down the road as it accumulates more than necessary housing. When a recession hits, and asset bubbles are deflated, speculation goes to zero, and you’re left with an over supply, an indebted society, and the country may lose generations of productivity (what actually happened in Japan in 1990).

>I'm kinda hoping for a recession

You don't have to hope -- recessions are a natural, unavoidable, and inevitable component of a typical business cycle.