by winston

ANDREW MELLON, Herbert Hoover’s treasury secretary, advised the president to “liquidate real estate” as part of a plan to “purge the rottenness out of the system”. Eighty years later, America has pretty much followed his advice. House prices have lost nearly all the real gains they notched up in the bubble period (see chart). That makes for a marked contrast with Europe, where prices may be off their peaks but have not lost all their real gains. Why the difference?