Q A Z Z O O . C O M

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We have all grown tired of reading or talking about the real estate bubble and how it caused the global collapse of the entire world’s economy. That stuff is just too heavy to have to read,  chat with our friends and coworkers about. And that is why it is going to happen again.

As Qazzoo reviews the real estate industry and the economy we are reminded that the recent bubble wasn’t the first bubble and it will not be the last. Most of us are too young to recall the bubbles that came before it, but they happened and we seem to be surprised each time. As long as mortgage companies are forced to make a profit they are going to create different ways for home owners to screw themselves out of home ownership and into foreclosure. That is the way we have always done it in the past. What has helped is when someone in government is able to study a little history and not worry about reelection as much as they worry about the people they represent.

housing-bubbleWe tend to look at history as what we had for lunch yesterday and we look at worldwide economics as where the world cup is going to be played next time around. By looking at other countries and what they did right and wrong we can avoid the same trap that they fell into. It isn’t that hard it just takes a little effort and we can easily see what causes bubbles and be prepared for them. The idea that we are on this planet alone is what leads us many times to recreate the same scenario that caused the housing and mortgage crisis in the first place.

The US has seen housing bubbles dating back to the 1800’s. Bubbles seem to pop about 18 years apart and that is why we can say without a shadow of doubt that we are going to be seeing another one in about 12 years. It is not rocket science, it is the nature of humans that makes the bubbles go POP.

We want to stimulate the economy so we make mortgages easier to get and with the ease comes people that should not have gotten a mortgage but because of the timing they were offered the ability and everyone makes money right up until we hear that big old POP that means the whole thing has gone down the drain.

This is usually after a surge in speculation by investors that don’t want to miss the boat as well as home buyers that think their incomes are going to continue to rise. Then the economy gets hit from some odd direction and either part of or the entire economy is we are all sent into a financial tail spin. All of us sudden we are all looking around for the bad guy. But we have all contributed to the event. If we are getting raises or spending more money, we are contributing to the eventual down turn and return to the medium.

If the economy were to always rise without corrections we would be paying a million dollars for a pack of gum sooner or later. Corrections are needed and we can either try to limit our exposure or we can get surprised at least twice during our adult years and feel that we are the victim instead of part of the reason.

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