Tiny Bubbles

Busted ones, anyway. Today’s NY Times has a good article on the housing bust in California. We’re not anything close to that bad here (in the area the Times writes about, 85% of the houses bought within the past three years are worth less than is owed on them) but there are lessons to be learned, especially the folly of blind optimism that assumes a never ending supply of young millionaires capable and willing to spend $5 million and more for a new house.

And if you missed yesterday’s paper, check out Joe Nocera’s column, also in the Times, on how Fannie Mae went off course, while enriching its officers. Nothing in here that the WSJ wasn’t warning about a decade ago but it provides an ugly view of what happens when politicians and (other) crooks collude.

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