&gt;If many economists predicted a recession on that scale, we would have many rich economists.<p>Its kind of inflammatory.  Using your logic:  If many economists predicted a healthy economy and housing market, we would have many poor economists.  I mean, if you have a vast body of evidence you can present that proves this is the case by all means present it.<p>Here is just one example:<p>US Federal Reserve Chairman, Alan Greenspan, has gone on record and said he knew of the impending housing bubble in 2005.  I think even the most blind economists could have predicted a devaluation in average housing price at $x0,000&#x2F;house (I really wish I knew that actual average price homes fell by), at 100M homes that is an evaporation of $x,000,000,000,000 of wealth, now from an economists point of view whether that suggest a imminent recession, I don&#x27;t know, but to me that is unprecedented.<p>Another:<p><a href="http:&#x2F;&#x2F;www.theguardian.com&#x2F;business&#x2F;2010&#x2F;apr&#x2F;16&#x2F;goldman-sachs-fraud-charges" rel="nofollow">http:&#x2F;&#x2F;www.theguardian.com&#x2F;business&#x2F;2010&#x2F;apr&#x2F;16&#x2F;goldman-sach...</a><p>Essentially, you had Goldman taking direct payments from a fund to sell the fund&#x27;s toxic loans to Goldman clients.<p>Home loans are traditionally solid investments (very low default rate), so the fact they were being chopped up and sold the way they were is clue number 1 the sellers knew to get rid of the asset whereas historically these were coveted investments.  Its a tiny fine but there was a fraud charge and $1B fine.<p>The catch is you can&#x27;t simply flood the market, or the market will react.  So the toxic loans were sold slowly and steadily for as long as possible. There was just so much bad debt that when the market did catch on the institutions were still holding a massive amount of bad debt...hence the bailouts.  Its not like they didn&#x27;t want to get rid of them sooner, but trying to get rid of it all at once would have been counterproductive.