The housing bubble was unsustainable from "summary" of The Big Short by Michael Lewis
The housing bubble was a monster that the financial world had never seen before. It grew and grew, fueled by greed, ignorance, and a blind faith in the system. People were buying houses they couldn't afford, banks were lending money they didn't have, and everyone seemed to think that the good times would never end.
But the truth was that the housing bubble was built on a shaky foundation. The mortgages that people were taking out were risky, to say the least. Many of them were subprime loans, given to borrowers with poor credit histories and little income. And yet, these loans were being bundled together, packaged into complex financial products, and sold off to investors as if they were as safe as houses.
The problem was that the housing market was a bubble waiting to burst. Prices were rising at an unsustainable rate, far outpacing the growth in incomes. People were taking on more and more debt, hoping that the value of their homes would keep going up and up. But eventually, reality caught up with them. The bubble burst, and the consequences were catastrophic.
As the housing market collapsed, so did the financial system. Banks went under, homeowners lost their homes, and investors saw their fortunes wiped out. The whole edifice of the housing bubble came crashing down, leaving behind a trail of destruction that would take years to clean up.
In the end, the lesson of the housing bubble was clear: what goes up must come down. The unsustainable growth in the housing market was a house of cards, destined to collapse under its own weight. And when it did, the fallout was felt far and wide, a stark reminder of the dangers of unchecked greed and short-sightedness in the world of finance.
