Ben, Patrick, and Keith — authors of this, this, and this housing bubble blog, respectively — have been valiantly — and successfully — helping people avoid the inevitable financial doom of homeownership since about 1998. (For your convenience, I’ve marked that year with a nice big red star in the below graph of average housing prices in Palo Alto, CA.) In exchange for that valuable public service, they have collectively made — I’m just guessing here — a few dozen to a few hundred dollars in advertising on their sites.
Other bloggers — most notoriously and successfully, the boys from Bloodhound — have taken these bubblistas to task. Greg Swann, for instance, has called Keith an “idiot” — and that was one of the more flattering phrases he used. A fairly entertaining, but somewhat unproductive, flame war developed when Greg made insinuations about what sort of pleasure Keith as the poster-child of bubblistas might take in constantly dreaming about the impending housing crash.
I, however, have a different take. I am truly grateful to these far-sighted pundits, for without their insight, many thousands more would have bought properties here in Silicon Valley over the last decade, pushing prices even further up, and making it more difficult for my buy-side clients to get into the market.
Being a math-ey type of person, I ran a series of Monte Carlo simulation multi-inverse-hyperbolic-regression models* to estimate what housing prices would have been in Palo Alto without the influence of Ben, Keith, and Patrick. Here are my results:
Gentlemen, on behalf of my buyer clients, thank you.
* Footnote — Actually, I pulled the projected numbers out of thin air. In consulting, we would have cited the “WAGNER Institute.”
Tags: Ben, Bubblistas, Consumer, Industry, Keith, Patrick, Real estate
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