"The median price of a home in America has grown about 800% in the last four decades."

I believe thats before adjusting for inflation. Its a much more modest effect if you adjust 1965 dollars to 2006 dollars and compare median values. I believe you will find that Inflation between 1965 and 2006 is about 600%.

Historically, real estate generally performs no worse than inflation, and generally, on average, about 2-3% above. If you want to find a general US bubble, it has to be in that "2-3% above inflation" zone, which doesn't leave much of a bubble if you consider population increase, more expensive costs of labor, more expensive building standards and etc.

You also will likely be forced to conclude that there is a bubble dating back to the earliest times of settlement, since real estate has performed more-or-less at about that level since records were first kept (with notable exceptions like the depression and post depression years, civil war, etc).

Then, comparing the US market to the global market, you would likely be forced to conclude that there is a global bubble since real-estate prices in most industrial societies have performed at comprable levels (again, with some notable exceptions).

I would not argue that there are bubbles in many large US markets, and also depressions in many large US markets. Speculation is definately a problm in several markets- but I believe that there are many markets where undervaluation is happening.

In as much as speculation is harming economic growth and performace, I would agree that some of the most economically core areas are blighted wth the most speculation, resulting in over-valuation. However, thats nothing new in the American economy, nor any economy. Its never the gold miners who got rich- its the folks who sold land plots and burlap jeans to the gold miners at inflated prices.