It also illustrates the point that “what’s different” about a particular business cycle is often a function of where excessive financing has been applied. In this case, it was residential real estate. In the earlier 1992–2001 cycle, rather than excessive credit creation, it was excessive equity valuations that funded an investment boom. While the excessive equity valuations did set the stage for a secular bear market, the recession that followed the technology bust was relatively mild and short lived, unlike the 2007–2009 recession.
