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Originally Posted by Mavdog
a quote from 2005? are you kidding me?
was there a "bubble" in the time period to which he was speaking (2004-2005)?
nah
here's what he actually said. clearly he was NOT anticipating the continues run up in home prices, he actually at that time thought it would not.
House prices have risen by nearly 25 percent over the past two years. Although speculative activity has increased in some areas, at a national level these price increases largely reflect strong economic fundamentals, including robust growth in jobs and incomes, low mortgage rates, steady rates of household formation, and factors that limit the expansion of housing supply in some areas. House prices are unlikely to continue rising at current rates. However, as reflected in many private-sector forecasts such as the Blue Chip forecast mentioned earlier, a moderate cooling in the housing market, should one occur, would not be inconsistent with the economy continuing to grow at or near its potential next year.
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Housing prices that rise 25% are not a bubble. Right.
Moreover you should look at a chart and tell us when home prices actually decreased or better when the bubble really was created and not at when it was burst.
At the same time Peter Schiff was talking about the housing bubble and what was gonna make it burst:
http://www.youtube.com/watch?v=Y8922EPkzjw
In addition there were highly scientific discussions about what was gonna make the bubble burst going on at lewrockwell.com. See, some people know a bubble when they see it, others think the magic hand of monetary expansion is gonna make humans the master of money (as Keynes put it when he was applauding monetary expansion right before the Great Depression) and turn bubbles into real solid economic growth.
Update: I renewed the chart.