"In the year 2020..."
I remember I once wrote a profile of Robert Prechter, the apostle of the “Eliot Wave Theory,” which believed that many things in life—including the stock market—ran in cycles, and you just had to figure out the rhythms of each cycle to profit from them. I told my editor at the time that Prechter believed that history repeated itself, and the editor said, “Humph. It’s a limited menu, isn’t it?”
So if past is prologue, then we should look to the past experiences of regions that have suffered housing collapses to understand what some bubble markets have ahead of them. Scott Burns, a financial columnist for the Houston Chronicle, offers a nice retrospective of the effect that the S&L crisis and oil bust had on the Houston housing market…
You can read the details for yourself, but Burns' conclusion is this:
The Texas template tells us we could be in for a 14 percent to 25 percent decline and an eight-year to 14-year wait for recovery. That's real history. It's not hyperventilation from the Chicken Little chorus.