It alternately amusing and discouraging to look back at news stories from 2002/3 and see how studiedly ex-Fed chair Alan Greenspan dismissed the idea of a housing bubble in the U.S. He called it "quite unlikely", said that there is no national housing market, and expanded with "We’ve looked at the bubble question and we’ve concluded that it is most unlikely…", etc.
Read more if you can take it here.
Mind you, he wasn’t the only one saying that sort of thing, despite evidence to the contrary. Check this quote from Bloomberg in 2003:
[A prominent economist] said he’d only predict a nationwide housing slump if a worldwide economic slump "kills” consumer confidence. Only some "high-flying” cities like San Francisco, Denver and Boston are at risk of price depreciations, and the chances of declines in those regions are less than a third, he said from his office at Yale University in New Haven, Connecticut.
"In the last bubble in 1990 the declines were preceded by a slowdown and accelerated by a slowing economy, and the slowdown might be a harbinger of a drop in some places,” [he] said. "Even so we predict increases everywhere. It would be quite daring to predict” a nationwide housing bubble, he said.
So, no national bubble, and no crash from where that Yale economist sat. And who is he? Some guy named Robert Shiller.