The Inside Edge
This weekend’s Independent on Sunday contained one of the clearest explanations of the 2000 – 2008 Housing bubble that I have read. Two simple graphs: one showing the spike in ‘House price to average earnings ratio’ between 2002 and 2008 and the other showing a corresponding spike in ‘UK Net mortgage lending’.
The relationship between a huge net lending increase (credit creation) and house prices seems undeniable.
I won’t add any value with additional commentary so head over the the Independent website to read the full article:
In fact print it off and keep it in your purse/ wallet and hand it to any bubble deniers you encounter.