Worse than 2008?


The 2007-2008 financial meltdown was often called “the debt crisis.” U.S. households and financial institutions became increasingly indebted or overleveraged during the years preceding the crisis. This increased their vulnerability to the collapse of the housing bubble and worsened the ensuing economic downturn.

Key statistics include:

Free cash used by consumers from home equity extraction doubled from $627 billion in 2001 to $1,428 billion in 2005 as the housing bubble built, a total of nearly $5 trillion over the period. U.S. home mortgage debt relative to GDP increased from an average of 46% during the 1990s to 73% during 2008, reaching $10.5 trillion.

So, what’s your point, Dr. Filly, ask you? My point, answer I, is that it is happening again.

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It appears that the lesson has been forgotten.

And thanks to PK for sending this graph to me.

Roy Filly

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About Roy Filly

Please read my first blog in which I describe myself and my goals.
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2 Responses to Worse than 2008?

  1. No, the lesson is the self-aggrandizing and vote-getting actions of the Dimocrats (intended spelling). The resulting problems for the economy are not part of their consideration. The nations’s problem is listening to and believing their fraud and deceit.

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