|
That's a good question. I think the "trigger" is, ultimately, the desire to make a return on an investment (a good desire), combined with the media and a herd mentality/lack of analysis/failure to grasp objective reality (bad things).
These reach a point to where a bubble is created. Once that bubble is started, it is off to the races. You saw it here, among many who are otherwise fairly smart. During the bubble, reality, and even clear history, is thrown out the window. "Real estate never goes down." The herd starts moving, and no one wants to be left behind. The media gets behind it and drives it harder (coverstories on the magazines about everyone from 22 year old kids to 55 year old housewives "cashing in" on real estate, etc.). It loses any touch with reality, and basically becomes a Ponzi scheme.
We saw it with real estate in the late 80s, tech stocks in the 90s, and then real estate again in the '00s. Money does seem to need to flow somewhere, and it seems like an asset bubble is always being created somewhere.
|