Last week I said that the bailout, by easing the fall of land prices, would delay the recovery. Now Vernon L. Smith agrees with me.
To the extent that the bailout shores up existing home prices and its paper, it delays the inevitable.
– WSJ 10/9/08 “There’s No Easy Way Out of the Bubble”
A couple of loose ends here. One is that Vernon says “home prices” whereas (as I assume he knows) the bubble was more in land prices than structure prices.
The other is that the article was sloppily copyedited, “its paper” probably should be “related paper” or something like that. And earlier, it says “[T]he crash has been exasperated by the increase in oil prices.” I guess Rupert has outsourced the copyediting to…somewhere not so sharp on English. It’s exacerbating.
