As the housing bubble was about to burst in 2006, Federal Reserve officials took time out from their work to joke about the situation. Additionally, they seemed clueless to the larger problems on the horizon that would lead the country to the brink of a full-fledged economic depression, to transcripts released by the fed show, The New York Times reported.

The transcripts show top officials joking about measures home builders were resorting to including offering cars as signing bonuses and making empty homes look occupied. The officials also seem to reject the idea that the housing market could affect the economy as a whole and were instead worried about inflation, the Times reported.

Obama administration’s Treasury Secretary Timothy Geithner, then president of the Federal Reserve Bank of New York, said in a December 2006 meeting in Washington, “We think the fundamentals of the expansion going forward still look good.” However, things were on the brink. By the end of 2006 income was shrinking and by the end of the next year the Fed was engaged in a struggle to prevent the collapse of the financial sector and avert a depression, the Times reported.

The transcripts show some of the nation’s top economists missed it. “It’s embarrassing for the Fed,” Justin Wolfers, an economics professor at the University of Pennsylvania, told the Times. “You see an awareness that the housing market is starting to crumble, and you see a lack of awareness of the connection between the housing market and financial markets. It’s also embarrassing for economics.”