By targeting house prices, New Zealand shows the way

While consumer prices have been held in check by globalisation and automation, easy money pouring out of central banks has been driving up the price of assets from stocks to bonds and housing. As homes are generally not counted as consumer goods, even sharp price spikes carry relatively little weight in central bank deliberations. 

Of 502 international cities tracked by Numbeo, a research firm, prices are “unaffordable” (more than three times median family income) in more than 90 per cent.

Housing bubbles are the worst. The $220tn global housing market is more than twice the size of the global stock market and complicated by debt.

Ruchir Sharma FT 14 March 2021

The writer, Morgan Stanley Investment Management’s chief global strategist, is author of ‘The Ten Rules of Successful Nations’

https://www.ft.com/content/c8959502-7dae-43b1-b993-3bf85fb4325a

If Greenspan had raised rates because of rising inflation starting about 2003–4, there would have been no housing bubble, no subprime crisis, no overheated stock market, and no stock market crash. 

We would not have had the worst unemployment numbers since the Great Depression. 

Retirees and everyone else would have been able to earn reasonable yields on fixed income instruments.

John Mauldin 12 March 2021

https://englundmacro.blogspot.com/2021/03/for-most-people-housing-is-major.html