"if everyone don't have a house and have to pay rent and never buy a house, and also don't want to work and are unemployed they can become homeless costs tax payers, puts pressure on interest rates..."
THE IS-LM MODEL First developed 1937 by J.R. Hicks, as a way to understand Keynes’ “General theory of employment, interest, and money”
Codified in more or less modern form 1944 by MIT’s Franco Modigliani IS-LM is the workhorse of applied macroeconomics. It is the way most policy-oriented macro analysts do back-of the-envelope analyses; it underlies basic policy formation at the Fed and the Treasury. Extended IS-LM is the basis for much international macroeconomics, policy advice to IMF clients, etc
