I've been reading this thread and enjoying it.
Just have to say, and I'm DEFINITEY NOT an expert in any sense, but while "history tends to repeat itself" is a useful maxim, it's also sort of silly.
History can really only do one of two things: go positive/go negative. So if there's some type of financial crash that affects real estate, banks, or anything else, someone will say, "You see? History always repeats itself."
But that doesn't mean a crash, or correction, is in some way related directly to real estate.
During the "GFC" 3 of my closest friends worked at major financial insitutions, and I knew at least 20 people working at the banks. Living in Jersey City/NYC was FUGGED UP! My closest friend was one of the top guys on the trading desk for Merrill's SP Mortgage Bonds. Michael Lewis seemingly tried to crap on their heads, specifically. The guy who committed the LARGEST TRADING LOSS IN HISTORY is my buddy's brother in law. JP Morgan gave him 40 Million to leave...what a country...
Yet those guys, believe it, or not, learned from that. Those who survived recognize the pitfalls, etc. So what type of real estate correction could create THAT situation again? No situation? Yeah, pretty much.
The GFC was a once-in-a-lifetime scenario. That's not to say it can't happen again, but lets not assume a "correction" is equal to what that was. It won't be. We just think to ourselves, "Oh, that happened, so it can happen again..."
Yeah, it can, but it won't be for a LONG *** TIME.
The next closest thing would be if the world was devoid of silicon and couldn't make microchips. Or the internet just stopped working. We're talking monumental!
I read a lot of those books when it was happening (Too Big to Fail, Diary of a Very Bad Year, Big Short, Eight Days, My Girlfriend Hated Me Because I Keep Talking About This Stuff, But She's a Moron), and you can tell that what happened was a perfect storm. So while we can expect storms, I think it's an overstatement to think THAT can happen again.
It's like, terrorists didn't "blow up our buildings." They flew planes into them. Ok, we locked the planes down, so now what can they do? They were willing to die. So now they have to hijack nuclear materials in suitcases, or take over nuclear weapons, etc. Like, REALLY HARD THINGS. The impact was catastrophic, but how they did it was really easy. in our minds though we think, "Man, what are they going to do next? They destoryed those buildings!" Well, they've tried other things; maybe blown up trains, or shot people in Paris, but they haven't destroyed buildings. They had their one big trick.
And basically, the mortgage crisis was that big trick, and it resonates because of the impact. But expect smaller scale things to happen as we go forward. Just not the MASSIVE scenario.
Sorry for the poor anecdote, but it works.
Wordy, I'm sorry, but I think corrections will happen, but in no way shape of form do I think it's anything like we just saw. History DOES repeat itself, and the history of 2009, if it repeats, would have to be generational because that was. We've got time...
