Resolving house price inflation

The American and thereby much of the world economy flirted with house price inflation or the equivalent of long term embodied short term wage/price inflation resulting from monetary expansion. That wage inflation did not keep pace with house prices to make them affordable over the long term is interesting enough. Had wages risen then America would have had to increase productivity correspondngly over the long term. That the increase in productivity was exported to China which did not appreciate its currency meant that the Amercan economy received a double bout of mismatch in its balance sheet. Recovery of a balance is next to impossible with continued monetary expansion that does not translate into higher wages sufficient to pay off the mortgages. Either house prices fall or bankruptcy of the banks occurs. No one expects that a rise in American productivity would bring about a balance, and the problem is that it would require Amercan firms or Chinese irms investing in America and a sufficiently wide distribution of employment gains. This would be too good to be true.