Quote of the day: the senseless rise of home prices

“The run-up of home prices made even less sense than the dot-com bubble – I mean, there wasn’t even a glamorous new technology to justify claims that old rules no longer applied – but somehow financial markets accepted crazy home prices as the new normal. And when the bubble burst, a lot of investments that were labeled AAA turned out to be junk.”

– Paul Krugman, writing in today’s New York Times about innovations in the financial industry that he argues are contributing to an economic downturn

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