As Doug Porter asked in his Talking Points on Friday : “Do you think that the best response to the Dutch Tulip Bubble in 1637 was to cultivate more land and grow more tulips?” Marcus McGee would probably respond yes, judging from his comments on how to cure the Toronto housing bubble. The annual rate of house price inflation in Toronto (based on the Teranet National Bank HPI) was 7.4% in December 2014, the month before Governor Poloz started dropping the overnight rate, but was 9.5% in December 2015 after he had dropped it from 1.0% to 0.5% and was 19.7% in December 2016. The Bank of Canada should raise the overnight rate sooner rather than later; that will help put an end to the Toronto housing bubble.