People usually don't take out loans to buy groceries. The money/credit supply matters when buying houses. Note, too, that I'm arguing that the price is affected

People usually don't take out loans to buy groceries. The money/credit supply matters when buying houses. Note, too, that I'm arguing that the price is affected, not the supply. As the GP points out, those who can pay cash for a house are at significant advantage to those who must borrow. As I repeat, houses can be bought as investments as well as 'consumables'. Maybe buying 67,000 houses isn't enough to monopolize the market, but I'll argue that the 1.7T the Fed has injected in to the housing market over the last decade through its purchases of mortgage-backed-securities [1] has had an effect on house prices similar to the 'wealth-owner' the GP describes. On a smaller scale, are you willing to argue that property values in Palo Alto aren't affected by purchases like Mark Zuckerberg's? [2] [1] https://www.federalreserve.gov/releases/h41/current/h41.htm#h41tab1 https://www.federalreserve.gov/releases/h41/current/h41.htm#... [3] http://money.cnn.com/2016/05/25/technology/mark-zuckerberg-palo-alto-house/ http://money.cnn.com/2016/05/25/technology/mark-zuckerberg-p...