Housing prices would rise even if money wasn't being printed. Because when I buy a house, the money doesn't disappear, it goes to the seller.
Imagine there was only one bank, we'll call it Banky Mc Investment Inc. or BMI.
Fred wants to buy a house. That house "costs" $1 trillion dollars. Bob owns the house and decides to sell.
Fred goes to BMI and says, "can I have a loan for $1 trillion?" BMI says "sure thing Fred" and BMI transfers "$1 trillion" to Bob's account. BMI then goes to Bob, and says "hey Bob, it looks like you've got a lot of cash in your account. Would you like to invest it in the BMI morgage investment pool, ultra low risk, backed by valuable real-estate? Bob says "sure thing!" and BMI's books balance. Sure, Fred now has a lot of debt, but there is no reason why this couldn't happen, even with a "limited money supply".
You don't need cash to put IOUs on the books.
Imagine there was only one bank, we'll call it Banky Mc Investment Inc. or BMI.
Fred wants to buy a house. That house "costs" $1 trillion dollars. Bob owns the house and decides to sell.
Fred goes to BMI and says, "can I have a loan for $1 trillion?" BMI says "sure thing Fred" and BMI transfers "$1 trillion" to Bob's account. BMI then goes to Bob, and says "hey Bob, it looks like you've got a lot of cash in your account. Would you like to invest it in the BMI morgage investment pool, ultra low risk, backed by valuable real-estate? Bob says "sure thing!" and BMI's books balance. Sure, Fred now has a lot of debt, but there is no reason why this couldn't happen, even with a "limited money supply".
You don't need cash to put IOUs on the books.