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RE: Housing – Prevent, Solve, or Manage
It seems to me there has to be an element of speculation to house prices fueled by QE.
It seems to me there has to be an element of speculation to house prices fueled by QE.
Reducing interest rates adds to the problem. This becomes worse the longer interest rates remain low as people start to assume they will never be high again. To be honest, raising interest rates by even a small amount could create a massive ripple effect.
The worst part of it is that central banks seem to have little choice because of sovereign debt among other things.