Australian Austrian economics writer Gerard Jackson skewers the fallacy that home extracting equity by borrowing against higher home prices then spending the money is good for the economy. Borrowing, argues Jackson (considering for a moment the case of an economy without fractional reserve banking), is the postponement of a consumption opportunity. One person’s borrowing is exactly offset someone else’s savings, somewhere else in the economy, so the net effect on spending is nil. Jackson. With fractional reserve banking, the borrowing may be funded by credit expansion, which increases total nominal spending in the economy and inflates home prices. The inflated home prices create provide a fictitous source of “wealth” that the home owners use to borrow against. Jackson also calls into question the dangerous Keynesian idea that increased spending at the expense of savings is beneficial and should be encouraged.