by Mike Kimel Rent Control, Redux There’s been a small dustup on rent control lately on the blogosphere. Peter Dorman has been pointing out that the theory everyone knows may not fit the facts. I myself covered the topic before here. Its worth a read, I think, but here’s the takeaway Now, I haven’t been […]
Lifted from comments on the housing situation by Spencer…Housing vs. Household formation. Of course the point also being…what is going to be the source of growth for US citizens? kharris comments and adds another contributing factor on the housing market: …Banks already have pretty nearly all the housing assets they care to have, thank you […]
Buce has been on fire recently, so I’ll probably have to do a post about why this post is so off-target, though his conclusion is correct (short version: he’s been misled). If I’m reading this morning’s SIFMA Brief correctly, Moody’s—whose rating skills Robert has discussed at length—(1) may downgrade US debt if we spend too […]
Industrial production and housing starts were reported today. It has been well covered elsewhere, but I though I would make a couple of comments. Compared to other cycles this recovery in industrial production continues to be moderate. It is stronger than in the weak recoveries, but compared to the depth of the downturns the rebound […]
Brad DeLong and John Cochrane agree on something. I must dissent. Delong and Cochrane agree that “The underlying decline in wealth from the housing bust was … around $400 billion. …” Indeed, relative to the size of the economy the losses during the crash of the dot-com bubble were four times as large. I object […]
by Rebecca Housing demand is being propped up by government subsidies and low mortgage rates, and the level of supply is held back by low prices. Right now, the housing market is a complicated hodgepodge of policy, foreclosures, and very weary potential home-buyers. Home sales are stabilizing; home building is stabilizing; and home prices (might […]
by Rebecca Wilder Actually, murky is something of a good thing when referring to business cycle dynamics. It usually means that a bottom is forming. In some sense, the key to recovery is the stabilization of home values. If home values would just “stop” declining – I understand that there is a market mechanism going […]
The editors of the WSJ agree with Brad DeLong that the Fannie/Freddie problem is that their short-term cash flows may be(come) impaired: The most immediate danger is that investors will shrink from rolling over the debt of the two companies, leading to a run a la Bear Stearns….With so much on the line, we’ve been […]
John Carney at Dealbreaker notes the official reason the White House prefers that the government takeover Fannie Mae and Freddie Mac: The reason the Bush administration is leaning toward bringing Fannie Mae and Freddie Mac into conservatorship rather than backstopping the two home mortgage companies is that concern about moral hazard problem. Bailing out Fannie […]
Tom already hit this Paul Krugman column, so I’ll just put together a list: “I.R.S. lets you deduct mortgage interest from your taxable income but doesn’t let you deduct rent” But not mortgage principal. And the interest deduction still leaves an owner out of pocket for at least 65%—probably more. “[I]f the market value of […]