The Fine Print on the Real Estate Bubble

Greater Boston

Dan Gillmor's Citizen Media blog, which normally just draws in the "citizen media gripes" in the comments like Seth, Delia, and myself (ok, I took a break for several weeks this summer), now has drawn a whole good deal more readers out of the woodwork. The impetus? In a post titled Another Gross Journalistic Failure, Dan offers a jeremiad against the mortage-morphing industry (previously known as the financial sector) and their apparent cheerleaders in the dead-tree business:

Oh, sure, there were extremely infrequent stories containing warnings in a few publications — and occasional quotes from skeptics in the prices-just-keep-rising stories that overwhelmingly dominated the coverage. But the reality is that journalists mostly didn’t have a clue, or didn’t want to have a clue. I don’t know which is worse.

Woof! Fighting words. He has a right to state his opinions, but times like this demand a little bit of solid evidence. And then the readers start piling it on: Matt Waite at the St. Petersburg Times, Derek Wills at the Washington Post (.com Newseek Interactive, natch), Steve Baker at Business Week, Chris Edwards, a freelance journalist in the UK, all pointed to mountains of articles where journalists had been trying in vain to inform the public.

Now, when the housing bubble began at the start of the decade, I was young and foolish, and penny-pinching like a journalist even though I'd been getting paid like a software engineer, and I didn't think about buying a place until 2005 (whereupon I could just tell my agent & mortgage broker: here's your twenty down; none of that playin' around). If I was truly keeping track of the bubble the whole time, I would have bought earlier.

As to the journalism issue, I suggested that a humble question to ask is whether there were enough "cross-over" stories where there were home finance articles in the Real Estate section (by extension, you'd need to put Health in the Food section, war-torn oil regime coverage in the Travel section, and these days, the police blotter in the Sports section, but no matter). I have a hunch there were such stories; the newspaper is not grossly incompetent. But I leave it as an exercise to a journalism PhD student to find out.

Anyways, I found the ad from the 2005 Boston Globe real estate section which demonstrates that even the fine print included warnings:


Sheesh.  And I never saw such honesty in Craigslist!


Dan's a friend. Have a laugh. You've been reading WordPlay.