On the other hand, mortgages were still based on more or less real criteria in 1983. So is this a bad thing?
“On the other hand, mortgages were still based on more or less real criteria in 1983. “
That’s a very good point. In 1983 the vast majority of loans were conforming loans and those have always performed well. Conforming loans mean you aren’t given more debt than you can handle.
The innovations and financial engineering of the late 1990s and early 2000s gave us the exotic loans that became wildly popular during the bubble. In fact they were bubble fuel since without those loans the real estate market would have peaked around 2003 and the ensuing meltdown would not have been possible.