The problem isn’t necessarilly that the housing was too expensive, people took out loans with very low Down payments and very high payments monthly. They also used ARMs and other riskier prospects without understanding what they were. The other day while I was at Sears buying a battery the 12 year old child of a Hispanic woman was having too explain in english how the pro-rate on the warranty worked, the woman kept getting madder at the store employee because she wanted a new battery. The funny thing was it was an Interstate battery, not a Sears battery.
This is the same as the housing problem in that, now because everyone wants to not address the single language barrier. People that can’t even understand how a warranty works, now want to understanad why their house price is unstable. Sometimes you have to get off the high horse of knowledge and realize that the lack of a cohesive education based on real life is needed, instead of the warm fuzzy education, that passes people along today.
Understanding how much a house, or warranty, or car is worth takes understanding.
That may be true in California, but here in NJ, its more of an INTELLIGENCE barrier. When I saw the advertisements in the ghettos of Newark, JC, etc. for "zero money down/no credit" houses going up, I knew that we have become way to generous with credit. Thanks Fed and HUD!