Linking ≠ endorsement. Enjoy and share:
- British austerity was even worse than you thought
We covered this before but are taking note that it is getting mainstream news (Washington Post) coverage.
They find that not only is austerity during downturns quite contractionary, but it even hurts growth during booms. “Our results underscore that austerity tends to be painful, but that timing matters,” Jordà and Taylor write. “The least painful ?scal consolidations, from a growth and hence budgetary perspective, will tend to be those launched from a position of strength, that is, in the boom not the slump.”
“This caveat is the zero lower bound (ZLB) of monetary policy: the U.K. out-of-sample counterfactual corresponds to a liquidity trap environment, but the in-sample data overwhelmingly do not,” the authors write. “In that case, the true residuals in 2010–13 could be much smaller than above, and the effects of austerity (i.e., the ?scal multipliers) even bigger, big enough to possibly explain most or all of the growth shortfall after 2010.”
- Fair housing groups rally behind Richmond’s eminent domain mortgage plan | Inman News
We are concerned the plan would do two things; otherwise, we’re all for helping people who were caught by the Wall Street debacle. First, we don’t want anyone, any firm, getting rich off the fees to process the plan. Second, we don’t want to encourage moral hazard, which in this case would be reckless borrowing that ends up being bailed out (again). The problem would be in identifying those who wittingly recklessly borrowed versus those who were truly being honest and just didn’t realize how reckless the entire system was being. We have a great deal of sympathy for that latter group and would not hesitate to help them or to even help rehabilitate the former group, provided we may be assured that bailouts will not remain the norm but rather truth in lending. We trust you agree.
A coalition of fair housing and civil right groups filed an amicus brief in federal court today [September 9, 2013] defending Richmond, Calif.’s plan to grant principal reductions to underwater homeowners by purchasing their mortgages using the city’s powers of eminent domain.
Read the source article … https://www.inman.com/wire/fair-housing- groups-rally-behind-richmonds-eminent-do main-mortgage-plan/
- Record High 291 Metropolitan Housing Markets Listed As Improving In September According to NAHB – Multifamily News Headlines – Breaking News, Stories, Top Headlines :: MultifamilyBiz.com
Good news provided it lasts:
WASHINGTON, DC – A total of 291 metropolitan areas across the country now qualify as improving housing markets, according to the National Association of Home Builders/First American Improving Markets Index (IMI) for September, released today [Sept. 10, 2013]. This reflects a gain of 44 markets from August and marks the index’s highest level since it was initiated two years ago.
The IMI identifies metropolitan areas that have shown improvement from their respective troughs in housing permits, employment and house prices for at least six consecutive months.
Read the source article … https://www.multifamilybiz.com/News/5016 /Record_High_291_Metropolitan_Housing_M arkets_Liste…
- BAC cutting 2,100 mortgage-related jobs (Video) – Charlotte Business Journal
Bank of America Corp. (NYSE:BAC) will slash about 2,100 jobs and close 16 mortgage offices because of weakening loan demand brought about by rising interest rates, Bloomberg reports.
All of the major US banks have now made cuts and/or announcements of same concerning their mortgage divisions.
- 10 Real and Bogus Reasons for the Slow Recovery | The Fiscal Times
A Keynesian approach (versus the Austrian School of Economics, which is to say, austerity)
Why has the recovery from the recession been so slow? Part of the answer is that recessions caused by a collapse of the financial sector are among the hardest to recover from. But that is not the only reason for the slow recovery. Many additional factors are often cited for the agonizingly slow recovery, some real and some bogus. Let’s begin with the real reasons for the slower than necessary recovery, and then turn to bogus reasons that have been used to support ideological goals:
The failure to address household balance sheet problems: When a recession is caused by a financial meltdown like we recently experienced, a “balance sheet recession” as it is known, an important part of the policy response is to repair balance sheets that have been severely damaged by declines in the value of financial assets and housing. Policymakers did a pretty good job of repairing bank balance sheets, and that certainly helped our prospects for recovery. But they did a very poor job of repairing household balance sheets wiped out by declines in housing and stock values. Households had no choice but to reduce consumption and increase saving to slowly rebuild their balance sheets, and the prolonged decline in consumption as balance sheets were rebuilt made the recovery much slower than it needed to be.
Mark Thoma, “macroeconomist and time-series econometrician at the University of Oregon,” then goes on to cover the following: Poor fiscal policy, monetary policy, technological change, and the distribution of income.
As for the “reasons that are claimed to have slowed the recovery,” he covers the claim that the slow recovery is due to that people are too lazy to work, Obamacare is the problem, the national debt and fiscal deficit are the problems, uncertainty over regulation and future taxes are the problems, and finally that our failure to coddle the wealthy is the problem.
Read the source article … https://www.thefiscaltimes.com/Articles/ 2013/09/10/10-Real-and-Bogus-Reasons-Slo w-Recovery