For the latest Peter Schiff, go to PeterSchiffBlog.com – The people who were buying real estate were making the same mistake as the people who invested in the stock market a few years ago. They were buying not based on the fundamental value of the asset, but on the belief that prices would keep going up, and that there would always be a greater fool to sell to. But eventually you run out of fools to sell to. The loosening of lending standards was a big factor in driving this housing bubble. Those standards are going to have to go way up. People were getting loans in which their mortgage payment was 80% of their real income. Factored into the amount of their income was the estimated amount that the value of their house would go up. Paradoxically, as real estate prices kept rising, they suddenly became affordable to everyone. If you bought something that always went up, then you basically couldn’t lose. In a free market, the lending bank would be very careful about who they lent money to. They wanted to see a 20% down payment. They also wanted to make sure that the house was appraised accurately. If the borrower didn’t pay, then they needed to make sure that they would be able to sell the house to make back some of the money that they loaned. Today, the lending industry is surrounded by moral hazards. When a bank gives out loans, they then package them together and sell them. All lenders want to do is give as many loans as possible so that they can package them together and …