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Tag Archives: Interest rates

Young people can’t Afford Homes

CNN Tells Us, Young People can’t Afford Homes Even Though more Young People have Homes now than when Trump was in the White House, CEPR, Dean Baker Major media outlets continually push the theme that young people can’t buy homes even though a larger share of households headed by someone under age 35 own homes today than when Donald Trump was in the White House. CNN pushed its entry into the contest for the best “Death of the American Dream” piece...

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Existing homeowners still trapped by their 3% mortgages

Dilemma . . . Do I make a jump to a mortgage at 6 to 7% just to have a bigger house? There is more to this than just interest rates. Building supplies as NDd mention have been an issue. If they are decreasing in cost, builders can lower prices to help sell new houses. Existing homeowners are still trapped by their 3% mortgages  – by New Deal democrat Higher interest rates have created a bifurcation in the housing market. While builders can...

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The importance of 10 (and 20) year new highs in interest rates

The importance of 10 (and 20) year new highs in interest rates  – by New Deal democrat As you may have already read elsewhere, interest rates on the 10 year US Treasury just made a new 10+ year high. Perhaps more importantly, 30 year mortgage rates made a new 20+ year high: Both rates are slightly above their previous highs from last October: Almost always in the past, interest rates peaked *before* the Fed finished hiking interest rates....

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Interest rates, the yield curve, and the Fed chasing a Phantom (lagging) Menace

Interest rates, the yield curve, and the Fed chasing a Phantom (lagging) Menace There’s a lot going on with interest rates in the past few days. Mortgage rates have increased above 7%: This is the highest rate since 2008. Needless to say, if it lasts for any period of time it will further damage the housing market. The yield curve has almost completely inverted from 3 years out (lower bar on left; upper bar shows a similar curve in April...

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The worst interest rate upturn since 1994

The worst interest rate upturn since 1994 is likely to produce the worst housing downturn in over a decade No economic news of note today; but tomorrow we will see housing permits and starts for March, and on Wednesday existing home sales. So let’s take an important look at housing. The recent increase in mortgage rates to over 5% is the most serious interest rate threat to housing in at least the past 30 years. As the below graph shows, the...

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The worst interest rate upturn since 1994 is likely to produce the worst housing downturn in over a decade

The worst interest rate upturn since 1994 is likely to produce the worst housing downturn in over a decade No economic news of note today; but tomorrow we will see housing permits and starts for March, and on Wednesday existing home sales. So let’s take an important look at housing. The recent increase in mortgage rates to over 5% is the most serious interest rate threat to housing in at least the past 30 years. As the below graph shows, the...

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Those Italian subsidies for Germany

Sergio Cesaratto – Those Italian subsidies for Germany December 8, 2021 Economics, EU politics, EU-Institutions, Finance, Inequality, National Politics, Regulation Italy has paid for certain ill-advised policies of the ECB – influenced by Berlin, the dominant power in Europe – with dozens of points of additional debt/GDP and finding itself ever poorer, while Germany symmetrically gained. Sergio Cesaratto teaches European monetary and fiscal...

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August housing construction shows stabilization, following interest rate moderation

August housing construction shows stabilization, following interest rate moderation This morning’s report on August housing permits and starts shows that the stabilizing of mortgage rates in the past few months has now stabilized housing construction. Housing starts increased 3.9% m/m, and total permits increased 6.0%. The less volatile single-family permits increased 0.6%. As a result, the overall trend for all three metrics for the past...

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Will A Rise in Interest Rates Lead to a New Debt Crisis?

by Joseph Joyce Will A Rise in Interest Rates Lead to a New Debt Crisis? The question of when the Federal Reserve will begin to reverse its loose policy stance continues to be a topic of widespread speculation. At last month’s meeting of the Federal Open Market Committee, its members showed a willingness to cut back on asset purchases in 2022 and to raise interest rates in 2023 but kept monetary policy on its current setting due to slower...

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