Another Housing Bubble?!?!

It seems that bankers and home buyers the world over have already forgotten about last decade's housing bubble.  Loose lending standards, low down payment requirements and really cheap credit have contributed to another housing boom.

From The Sydney Morning Herald:

Nominal house prices have risen 29 per cent in Australia, 28 per cent in Canada and 61 per cent in Israel, form the first quarter of 2009 to now, according to Goldman Sachs.

We are talking about returns of 6%+ per year from housing during The Great Recession.

Let's remember what a house actually is, a depreciating asset that costs money to maintain.  It should not increase in value unless the land it sits on becomes more desirable.  Increased appeal of land is logical in some cases (i.e. an oil discovery) but land values should remain very stable over centuries.

Things like this shouldn't occur...  

Boom > Bust (from OfTwoMinds.com)

  
So what will be the conclusion to this most recent housing bubble?

Should Banks Have the Power to Create Money?

Should private banks have the power to create money?  "No" says Martin Wolf.

It is interesting and encouraging that the mainstream financial press is questioning the current banking regime.  Since many adults reject the reality of the banking system's foundation they may need to hear it from FT*, New York Times and WSJ in order to "believe".    

Those with an open mind can learn the simple truth about the financial system from many arenas.  Once the reality of the situation is understood there is hope of changing the foundation or just working around it.

Besides Wolf there have been many folks questioning the banking & money creation regime for decades.  One great author is Thomas Greco who writes at Beyond Money.  

In a response to Wolf he writes:

The problem is not private money creation, per se, but the monopolization of credit (money creation) in the hands of a private banking cartel and the collusive arrangement between bankers and politicians.

No matter how much you understanding the financial system I recommend reading Greco's work.

*Wolf's article was published in the Financial Times.  

The Changing Values of Paper Currencies

In the past year the value of the Australian Dollar measured in gold is unchanged.
In the past year the value of the Japanese Yen measured in gold has declined 17%.

Which do you think is volatile, the value of the currency or the value of the metal?