The Fed may also be inflating to reduce the real size of mortgages. If it can be proven that Ben is explicitly doing this, I’ll petition to have him canonized.
I’m not sure about the canonization but it would indeed be a way out of the housing slump. A decent burst of inflation (say, 10-15% total over a couple of years) alongside negative real interest rates would indeed solve the problem.
Yes indeed, it’ll screw all sorts of people as well: but then what’s worse, inflation or deflation?
(This isn’t a policy recommendation from me: I don’t do macro and no one would be foolish enough to listen to me anyway. But it has occured to me that this might indeed be what the plan is.)