Some readers have asked for evidence that I saw the housing bubble; others are using that out-of-context remark about the Fed “needing” to create a housing bubble. So some backward looks:

I was warning about a housing bubble through much of 2005; the big piece was That Hissing Sound, where I argued that you needed to differentiate between regions to see the bubble’s full extent.

Oh, and the usual suspects slammed me for that column, basically arguing that it reflected nothing but Bush-hatred.

So did I call for a bubble? The quote comes from this 2002 piece, in which I was pessimistic about the Fed’s ability to generate a sustained economy. If you read it in context, you’ll see that I wasn’t calling for a bubble — I was talking about the limits to the Fed’s powers, saying that the only way Greenspan could achieve recovery would be if he were able to create a new bubble, which is NOT the same thing as saying that this was a good idea. Of course, I know that this explanation won’t keep the haters from pulling up the same quote out of context, over and over.

But did I call for low interest rates? Yes. In my view, that’s not what the Fed did wrong. We needed better regulation to curb the bubble — not a policy that sacrificed output and employment in order to limit irrational exuberance. You can disagree if you like, but that doesn’t make me someone who deliberately sought a bubble.

Anyway, just for the record.

Update: The link for the 2002 piece seems to be broken — and it’s not because the url is wrong. Something with the Times website. Here’s a copy.

… and now it seems to be back. Wuh?