My, how different the world looks with hindsight.
Hindsight? I've been saying the housing bubble is going to burst for the last 5 years ('03 to about '08, when the mantra became, "See, I fucking told you so!"), arguing with my Realtor friend, and I don't know shit about economics. It was just so unbelievably obvious to me that it's hard for me to believe our "officials" didn't see it coming. Doubly so when they then proceeded to take actions that in fact made it worse, rather than heading it off at the pass. And got rich in the process. The government version of Enron, anyone? Literally. s/stocks/housing/gi and you have the biggest fucking pump and dump scheme ever concocted by man. First at the expense of speculators, then big corporations, and now the American Taxpayer. And us fucking morons are voting for more anal raping at the expense of these losers, which is why we elected Obama over McCain instead of throwing them both to the dogs and getting Ron Paul or (shudder) Bob Barr in there. Kenneth Lay is probably snickering at the genius of it all and kicking himself in the ass for not thinking of it himself.
No, far from surprising, this seems downright intentional to me.
I'm not alone, either. In fact, other silly Austrian-school economists were predicting the housing collapse for way longer than myself. It was never a question of if for them, but rather of when.
Now, I'll admit I never saw the investment banks or AIG getting tanked, but that has less to do with the predictability of the situation and more to do with me not knowing shit about economics and not having thought it all the way through. Although in some sense, it's impossible to think through what all the unintended consequences of government action might be. Just today I was thinking about how the government has poured trillions into the banks trying to get them to lend, and they still aren't, and I was theorizing about why that was, and realized that there was a potential scenario where the more money you injected, the less incentive there would be to lend it out. On the surface, it seems retarded that making more money available would make lending harder, but when you really think it through, there's a good reason why it might. And if I do say so myself, that's a pretty big fucking unintended consequence.
In closing, a random related tangent: it's only the big government Keynes that have been blindsided by this, which should tell you something about that economic model/theory...