| There are thousands of former home owners across | | | | responsible for the results of the artificially low |
| the country who are shaking their heads and | | | | interest rates that helped drive the house buying |
| wondering where things went wrong in their pursuit | | | | frenzy but low interest rates themselves were not |
| of the American dream. So many people around the | | | | the primary cause of the resulting housing bubble, |
| country have lost their financial stability and their | | | | researchers say. |
| homes and are really at a loss as to how everything | | | | One of the key factors of a housing bubble is when |
| has fallen, crashing around their heads. | | | | people inexplicably expect that real estate values are |
| There are a few things that the university | | | | going to climb continually, with no end in sight; which |
| researchers have discovered however; the elements | | | | we have definitely seen while the bubble continued |
| that contributed to the recession which many people | | | | to inflate, before the recession. Housing prices were |
| think are the primary causes of it, are not. While | | | | driven up by upwards of 70 percent over the years |
| many people think that the sources of the current | | | | between 2000 and 2006 as home buyers joined into |
| economic downturn are fairly obvious, like dishonest | | | | the frenzy of home buying. |
| lenders and borrowers lying to qualify for loans that | | | | While public comments about this study suggest that |
| they could not really afford, the true reasons for the | | | | many people do not agree that the Fed is not more |
| economic recession are at this time still unknown | | | | responsible for building the housing bubble, the case |
| according to researchers from Harvard University and | | | | appears to be more complex than that simple |
| the University of Pennsylvania who have conducted a | | | | scapegoat. The researchers determined that at this |
| study on the causes of the recent recession. | | | | time, we really do not understand why people came |
| The housing bubble crash which triggered the | | | | to the unlikely conclusion that housing values would |
| recession was not, they discovered, caused by the | | | | defy logic indefinitely; but unfortunately it seems like |
| low interest rates and easily attained home loans. | | | | whatever caused that response was the driving |
| Both of these situations were definitely contributing | | | | force behind the housing bubble to inflate like it did. |
| factors, but they weren't the main cause, according | | | | Hopefully we have learned enough from this bubble |
| to the University researchers. There seems to be | | | | for buyers to not help inflate another one anytime in |
| agreement that the Federal Reserve is greatly | | | | the near future. |