Two things you missed.
1: It was not only low income people involved. Those with incomes of $75k to $150k were buying homes 50% bigger than their needs because they saw it as a good investment.
2: The deductability of car loans went away at about the same time that home equity loans came in, so most people took out an HEL and bought cars. That was well before Bill Clinton.

Otherwise I agree with you, especialy on the MSM talking down the economy. I was never particulary concerned about the $4 gas, even if I was driving a lot. It was a big issue for my mother, who is in a nursing home, does not drive, and watches CNN all the time.