... FUND Research Department Policies for Macrofinancial Stability: How to Deal with Credit Booms Prepared by Giovanni Dell’Ariccia, Deniz Igan, Luc Laeven, and Hui Tong1 with Bas Bakker and Jérôme ... was ill-equipped to deal with aggregate credit dynamics.4 Second, as for asset price bubbles, there was the long-standing view that it was better to deal with the bust than to try to prevent the ... susceptibility to credit booms and devise policies to reduce this susceptibility Three often concurrently observed factors are frequently associated with the onset of credit booms (see, for instance,...