What types of transparency are needed to preserve public confidence? At the most basic level, a central bank must be clear and open about its actions and operations, particularly when they involve the deployment of public funds.
About a year ago, I examined this issue in some detail and concluded that, while one could never be very confident about such a judgment, house prices were not obviously too high and the housing stock was not clearly too large.1 Since then, however, prices have climbed further, and by more than the rise in rents - a proxy for the return on houses.