It's because the federal reserve is setting interest rates, and not the market, but that creates bubbles. I mean, if you had 100K sitting around, would you deny yourself access to that money for 30 years to finance somebody else's mortgage at 1% APR?
After all, if you can (effectively) get money from the central bank at 1%, and stocks are going up 10% per year, then it's a no brainier. But that is a disaster waiting to happen, either it ends like the housing bubble in 2008 with a massive crash, or it ends hyper inflation.
It's because the federal reserve is setting interest rates, and not the market, but that creates bubbles. I mean, if you had 100K sitting around, would you deny yourself access to that money for 30 years to finance somebody else's mortgage at 1% APR?
After all, if you can (effectively) get money from the central bank at 1%, and stocks are going up 10% per year, then it's a no brainier. But that is a disaster waiting to happen, either it ends like the housing bubble in 2008 with a massive crash, or it ends hyper inflation.