February 22, 2008
Are bubbles more common in the West?
The NY Times today had a piece on different proposals floated by Congress, Banks, and others to bail out homeowners who are “underwater.” There are also some quotes from people who believe that someone (namely, you and I) should help them at least break even on their houses that they’re trying to sell.
But among other things was this curious graph:
Thinking back to 2000, it should be recalled that the .com boom was also primarily in the West. There was also the Gold Rush of 1849.
Is there something inherent about the West that makes it more prone to bubble economics? Is the Northeast less prone because of the proximity to Wall St, and the ability for analysts to take a short drive to actually check out the situation for themselves? Is there more optimism in the West?
I wish the Freakonomics blog would investigate this.
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