Managing Credit Bubbles
---- Acknowledgments ----
A previous version of this paper was circulated under the title "Bubbly Collateral and Economic Activity". We thank seminar participants at various institutions and Zeno Enders, Raquel Fernandez, Bernardo Guimaraes, Zhiguo He, Joachim Jungherr, Fabrizio Perri, and Oren Sussmann for very helpful discussions. We acknowledge support from the Spanish Ministry of Economics and Competitiveness (grant ECO2011-23192) and the Generalitat de Catalunya-DIUE (grant 2009SGR1157). In addition, Ventura acknowledges support from the ERC (Advanced Grant FP7-249588), and Martin from the Spanish Ministry of Science and Innovation (grant Ramon y Cajal RYC-2009-04624) and the IMF Research Fellowship. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.