Author Archives

  • Households Continue Balance Sheet Repair

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    The Quarterly Report on Household Debt and Credit from the New York Fed provides additional evidence that households continue to pay down debts as a consequence of the Great Recession.  We have previously reported Fed data showing declines in outstanding mortgage debt. We have also made the argument that the personal savings rate will remain elevated as long as households… Read More ›

  • The Return of Quantitative Easing

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    The Federal Reserve Open Market Committee has announced a resumption of quantitative easing, a monetary policy designed to keep interest rates low to stimulate a more robust economic recovery. As justification for the policy, the Fed summarized the current sluggish economic recovery as follows: Information received since the Federal Open Market Committee met in September confirms that the pace of recovery… Read More ›

  • Fed’s Beige Book Continues to Report Slow Economic Growth

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    The Federal Reserve’s October Beige Book, which surveys national economic conditions, reports that for the September to early October period economic activity continued to grow, albeit at a slow pace.  The report is similiar in tone to the September release. The report provides additional support for the expectation that the Federal Reserve will undertake a second round of government bond purchases, so-called Quantitative… Read More ›

  • Characteristics of New and First-Time Home Buyers

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    NAHB economist Heather Taylor has published a new Special Study on the characteristics of new and first-time home buyers. Using 2009 Census data  from the American Housing Survey, Taylor finds that 41% of home buyers between 2007 and 2009 were first-time buyers (totalling 8.4 million households).  This share was up from 35% from the 2005 to 2007 period, in part due… Read More ›

  • Fed Data Points to Stabilizing Housing Wealth

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    Improving household net worth is key to achieving sustained economic growth.  And homeowner equity is an important component of total household net worth.  As we’ve noted in an earlier post, sustained GDP growth will be difficult to achieve without a reduction in the personal savings rate.  The savings rate will remain elevated as long as households believe they have excessive debt and… Read More ›

  • Fed Beige Book Reports Slowing Growth

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    The Federal Reserve’s September Beige Book, which surveys national economic conditions, reports that for the mid-July through August period, economic growth slowed compared to earlier in 2010.  The survey found that consumer spending increased, but that consumers on the whole remained cautious.  Many sectors experienced growth but slower growth than was realized earlier in the year.  These sectors included manufacturing, professional… Read More ›

  • Household Savings and Economic Growth

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    As the economy continues to seek sustainable growth, or at least growth strong enough to produce significant employment growth, one explanation for the weak growth of 2010 is a persistent, elevated household savings rate. Because of increased debt levels prior to the Great Recession and declines in asset values like stocks and housing during the recession, households have had to increase savings… Read More ›

  • Economist Karl Case on Homeownership

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    Karl Case, a co-creator of the Case-Shiller home price index, writes in today’s New York Times on the state of homeownership: Depressing, yes — but the end of a dream? Not exactly. I have never quite understood what the American dream really means when it comes to housing. For some people, it means having a solid and fairly safe long-term… Read More ›

  • Homebuyer Tax Credit Totals

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    The Government Accountability Office has released a report tallying the number of homebuyers benefitting from the homebuyer tax credit. The numbers are still incomplete as the IRS continues to process submitted claims.  Further, some homebuyers will not claim the credit until the end of the 2010 tax season in April of 2011. Nonetheless, the current totals are as follows: 1… Read More ›

  • GSE Financial Report Highlights

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    The Federal Housing Finance Agency, the regulator for Fannie Mae, Freddie Mac, and the 12 Federal Home Loan Banks, has published its first Conservators’ Report on the Enterprises’ Financial Condition. Future reports will be issued on a quarterly basis. Among the findings of the report: At the end of 2007, Fannie and Freddie held $71 billion in capital From the… Read More ›