Unfortunately, I'm only partly kidding. The NYT apparently still does not recognize that there was a housing bubble. In its editorial today it argued for including reform of the bankruptcy laws to protect homeowners (good) and to support house prices (loony). It is incredible that the NYT missed the $8 trillion housing bubble on the upside. (Actually some of its reporters did write about it, unfortunately the editorial writers apparently don't read the paper.) It is astounding that they still can't see the bubble even as its collapse is leading the country into a financial crisis and recession. It makes no more sense to prop up house prices than it does prop up the price of Internet stocks. The big mistake was letting house prices get so out of line in the first place. The best that we can hope to do now is limit the pain to homeowners and the financial system.
--Dean Baker