Forum: Tackling asset-price bubbles

Few topics in the theory and practice of central banking are as hotly debated as the relationship between monetary policy and asset prices. While most observers agree that fluctuations in stock prices, real estate values, and other asset prices can typically be managed within the conventional neo-Keynesian framework as one of many factors that affect the outlook for real activity and inflation, the treatment of more pronounced asset-price "bubbles" is a more contentious matter. The argument o