Speaking Personally
With , Barry Ritholtz, Paul Krugman, and David Glenn, referencing it I will need to be reading Is the 2007 U.S. Sub-Prime Financial Crisis So Different? An International Historical Comparison* (PDF) Carmen M. Reinhart, University of Maryland and the NBER Kenneth S. Rogoff , Harvard University and the NBER, January 14, 2008. Reinhart and Rogoff compare data for the US to averages of the same data for "banking crises in advanced economies" ( 15 examples) and "Big 5" crises (most severe of the first set).
If the current crises in the US behaves in a way similar to the average of past crises then "Growth momentum falls going into the typical crisis, and remains low for two years after." It may be coincidence but that is the typical period individuals grief after a severe shock like loss of a job or a spouse.
Quotes and Pointers
There are a few near certainties in this business -- not many, but a few -- and one of them is that abnormally high profit margins will go back to normal. The timing is unfortunately shrouded in fog. The other near certainty is that house prices will go back to a normal multiple of family income. In the end, we, the people, have to be able to afford the houses and they are affordable at something around 2.8 times family income. When they peak in Boston at 6 times and nationally at 3.9 times, you know you are in for tough times.
Out and About on the Net with Twitter Lines
Subprime losses could rise to $400bn -- Paulson says “I believe that we are going to keep growing. If you are growing, you are not in recession, right?”
Evangelical Vote: Down to Two -- Evangelical Vote: Down to Two One
True Blue Roses to be Sold First in Japan -- O my Luve's like a blue, blue rose...
et alli is cross posted at The Intelligence Forum