Re: Shiller on housing bubble

[Doug Henwood <dhenwood@xxxxxxxxx>]

sam gindin wrote:

> When the housing bubble bursts, there will be some pain, unevenly felt (some
> may even find they can afford the lower price of home) and there will be
> some 'adjustments' in the economy, some perhaps quite stabilizing (though
> this too will lead to some responses from the fed to ameliorate, to the
> extent it can, the depth of the crisis. But what more are people expecting
> than a semi-crash or a recession? Are people on the left arguing that a
> serious economic collapse and turning point in capitalism is imminent (Or
> only that we're in for a roller-coaster of a ride and some retructuring)?
> That a new movement will emerge out of this (rather than a working class
> intent to just get back to 'the good-old days' even if it means some
> concessions)?
> My own take is that in the absence of a working class already strong enough
> to limit the options facing capital and the state, the crisis will be
> limited...

Wow, it's perversely reassuring to find someone more sanguine about
capitalism's stability than me!

I'm certainly not expecting a collapse or any kind of political
turning point. I do expect that lots of people will find themselves
"embarrassed," as they used to say in the 19C, by their housing
debts. And that could have interesting political repercussions that
we could work with. I think the larger story is that the U.S. economy
is in some sort of longer-term post-bubble stagnation, which hasn't
really worked itself through - and that working through has been
postponed by the housing bubble. So the second act of the post-bubble
scenario will unfold. Somehow.

Doug