I certainly do not expect a housing crash.
But umm, in Oct 2007 one month before the great crash of our lifetimes
the economy was, stronger than it is today in many ways,
Certain economic strengths, as good as they are, are like pepperoni pizza. It’s really good but it does not prevent a credit event.
US GDP also increased 4.9% in Q3 2007
(Same as the Q3 that just got reported on.)
Yup pepperoni pizza sure is good,
and it sure doesn’t prevent credit events.
Net savings are negative for (only) the third time since 1947.
Every recession since 1947 has been preceded by a decline in net savings as consumers attempt to continue their top-of-the-bubble spending while real incomes didn’t keep up.
Generally, the dip in savings was relatively mild (savings were at least, still positive) and the recession that followed was mild. Only twice did savings drop so much it actually became negative, the 2008 recession and the COVID recession.
