It's easy to miss the narrative with all the economic analysis, but at the heart of it all is the home is the foundation of Western society.
You get a cheap mortgage, settle down, fill the house with consumer crap, have kids (who consumer more consumer crap), and that's how we sell each other goods and services that give us jobs til the day we die.
You make homes expensive, and you remove the incentive to settle down and fill your home with consumer crap.
The system comes to a grinding halt right before our very eyes.
It's as if young Americans with their 6 figure student loans couldn't afford to buy consumer crap anymore. And that fucked the prospects of the Chinese $2 a day laborer.
Same thing's happening to Australia. Japan predated it all. Europe and their PIIGS with 20-50% youth unemployment did them in as well.
Whoduthunk making a simple rule change called Basel that made houses assets (and thus expensive) would have unintended consequences?
There's enough young bodies in this planet to consume shit and enough production capacity on this world to produce that shit.
But something's fucking up the whole production to consumption chain.
Economist like Keen argue it's the debt that's cogging the wheels.
It's true, but our debt based capitalism insists on ever growing levels and there simply wasn't sufficient demand for credit from the consumers so a property bubble was the only logical choice to save the system in 2001-2002.
The bank of england governor admitted this publicly in fact. An amazing admission but one that recieved little attention since the majority of people own homes and couldn't care less as long as they're worth more. You said it right. Greed Greed Greed.
When you buy gold with your savings you're not being greedy, you're not denying a young couple a roof of their own, you're not exploiting pensioners who can barely afford a decent meal.
"Panics do not destroy capital; they merely reveal the extent to which it has been previously destroyed by its betrayal into hopelessly unproductive works." John Stuart Mill
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