[worstspotgain]

Prices are not the relevant statistic though, it's housing starts [1]. They dropped from ~1.8M in April 2022 to ~1.3M today. Prices are affected by supply and demand equally, while starts are much more affected by supply.

As for how the Treasury and Fed managed the crisis, it was easily the most incredible macro success story since I've been alive. Had you told me in 2022 that they'd manage sub-3% inflation without a recession at all, I'd have said you believed in fairy tales.

[1] https://fred.stlouisfed.org/series/HOUST

[_heimdall]

> Prices are not the relevant statistic though, it's housing starts [1]. They dropped from ~1.8M in April 2022 to ~1.3M today. Prices are affected by supply and demand equally, while starts are much more affected by supply.

New construction and prices are always connected, I'm not sure how you could consider one without the other. New builds increases supply, but building them requires buyers willing to pay market price for them. You can't have one without the other.

> As for how the Treasury and Fed managed the crisis, it was easily the most incredible macro success story since I've been alive. Had you told me in 2022 that they'd manage sub-3% inflation without a recession at all, I'd have said you believed in fairy tales.

Its too early to make that call either way. They may very well have managed the "soft landing" they kept pitching, but we really won't know for sure for at least a decade or so. Markets move slow and economies move even slower, give it time to shake out before popping bottles and awarding Nobel Prizes.

[worstspotgain]

The goal in increasing rates is to cool the economy by reducing construction, i.e. housing starts. Exchanging existing units doesn't affect employment and output as much. Since starts dropped by a third, it follows that prices would have been even higher without the raise in rates.

> we really won't know for sure for at least a decade or so

We absolutely already know. The contractionary effect of a raise in rates is largest in the short term. You can't have a lagging effect after rates are cut if there was no contraction to begin with.