Things seem to be sliding in that general direction.
From Japan Times:
The news comes as many economists are beginning to worry that the U.K. economy is starting to show some of the symptoms that have caused it problems in the past. The main concern is centered on the housing market.
Over recent months, house prices have accelerated, particularly in the southeast and London, fueling worries that another boom is in the cards that will eventually require the Bank of England to increase interest rates.
From Nick Rowe:
Reading Bank of Canada Monetary Policy Reports doesn’t normally annoy me, but reading this latest one did. Specifically, this bit:
“Although the Bank considers the risks around its projected inflation path to be balanced, the fact that inflation has been persistently below target means that downside risks to inflation assume increasing importance. However, the Bank must also take into consideration the risk of exacerbating already-elevated household imbalances.” (my bold)
Translation: “We would maybe like to cut interest rates to prevent inflation staying below target, but we are scared of doing this because it might cause some people to borrow too much, so we are just crossing our fingers and hoping something will turn up so we don’t need to cut interest rates.”
Long ago, in the 90s, more growth meant (through Phillips Curve reasoning) more inflation. Central Banks had to increase rates. Now, more growth spells bubbles and imbalances. Central Banks cannot reduce rates (despite below target inflation)
The HPI pictures are very different, but in both “bubbles” are ‘identified’!