Causes of The Economic Debacle Disequilibrium between demand and supply

It is a hard fact that the violation of economic laws never goes unpunished.. It was criminal on the part of the government to permit reckless expansion of the credit. A false sense of prosperity was created to put easy money in the hands of the people through the banking system which created all kinds of demand in every sphere of human activity. The situation called for corresponding increase in supply position in all those sectors to maintain equilibrium between the forces of demand and supply. This did not happen. The supply either remained static or even declined in some cases for various reasons. The commodities that were in short supply were hoarded and their prices went out of reach of the consumer. The surplus money floated freely in the market in search of avenues of productive investment which unfortunately were not to be found any where. Much of it, therefore, went into real estate sector. Prices of the plots and houses went sky high.