“Although the housing boom and bust has national repercussions its origins tended to be concentrated in particular places. Most of the adventurous financing was concentrated in places like coastal areas like California, Phoenix, Florida, which was where the great bulk of the defaults and foreclosures had occurred in later years. In fact, you can break it down into particular counties within these states. Only really a very small part of the United States generated the delinquencies, the defaults, and the foreclosures which then snowballed across the country through the financial system and even spread over seas. But the origins were in these extremely expensive areas where the prices have been forced up artificially and where people in desperation …”
Thomas Sowell discusses how an economic disaster developed out of the economics and politics of a housing boom and bust.