Summary
Akhil analyzes new central bank mandates to consider house prices (New Zealand, ECB). He argues this won’t prevent the cycle — central banks are reactive, not proactive. Greenspan’s 2004-07 rate rises are the template: too low initially, then too high, leading to a crisis. In the “Winner’s Curse” final phase (2024-26), central banks will be forced to raise rates quickly, surprising everyone. New Zealand already has the world’s hottest property market yet hasn’t acted. Competition between banks is pushing some UK mortgages below 1%.
Key Claims
- Central banks being given house price mandates won’t prevent the cycle — they’ll still be too slow to act. — confidence: high
- Greenspan’s template: rates too low → land boom → rates too high → crisis (will repeat). — confidence: high
- In the Winner’s Curse phase, central banks will surprise everyone by raising rates quickly. — confidence: high
- Some UK mortgage rates have fallen below 1% due to bank competition. — confidence: high
- The cycle peak always arrives as interest rates are rising — everyone is surprised. — confidence: high