Why the Boom-Bust Cycle?
It is a result of a highly combustible mixture of govt. intervention in the economy, via tax law changes that affect homeownership and sale of primary residence and very active Federal Reserve that keeps rates at artificially low levels only to have to take them too high to fight the resulting inflation, and the good old American promotionalism (there you go, I just coined a new term). Who cares for the refrains – beware of strangers (lawmakers and Federal Reserve) bearing gifts and take cover when you see an American promoter, especially, belonging to a highly organized group. The promoters in this case are well-known trade groups that help our lawmakers find ways to help American People with the American Dream. They are doing “Lord’s work” in the material realm! Quantification of Housing Boom-Bust Cycles The easiest to quantify is the new construction of residential units. Residential Fixed Investment (RFI), in dollars, is reported as the part of the GDP report. Due to the pipeline o
