Home ownership can be bad not only for the individual, the ECB says it can be harmful to the financial stability of whole economies. The higher the level of ownership in a given country, the longer and bigger the credit cycles are. Boom and bust, boom and bust, boom and bust. Professor Steve Keen, author of “Can We Avoid Another Financial Crisis?” believes that, indeed, houses are not bananas. It’s the credit, stupid. Credit drives demand and price increases, so address that, not monetary policy.
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