In so far as financial developments influence the long term output and employment growth, they can affect the wide range of indicators and tools that central banks use to monitor and model the behaviour of the economy. More specifically, changes in the banking sector may affect the monetary transmission mechanism.
25 Moreover, there is some evidence that today’s young people have a skeptical view of the wisdom of buying a home as a result of the housing crisis. The percentage of renters in the 18-to-34 age group who thought housing was a safe investment dropped significantly from 2003 to the first quarter of this year, from 85 percent to 59 percent, respectively.