The Residential Real Estate Crash Index Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Residential Real Estate Crash Index

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

From: CalculatedRisk	4/7/2005 7:47:57 PM
	Read Replies (1) of 306849

Higher mortgage rates to bite money.cnn.com This story notes that the housing slowdown will also impact the general economy. An excerpt: Whether or not rising mortgage rates cool the housing market, they're going to put a multi-billion-dollar dent in consumer spending -- and soon. That could have big implications not just for housing, but for U.S. economic growth, economists said. Mortgage debt now stands at record levels, having risen $1 trillion last year alone, and dwarfing other types of consumer debt, like credit cards. Homeowners have turned the equity they have in their homes into a virtual ATM, supplementing their household income through additional mortgage borrowing. I plotted the mortgage increases vs. GDP growth and it looks like we are buying growth with debt (see first graph): calculatedrisk.blogspot.com And that led me to this possibility (with an assist from Drs. Roubini and Setser): Housing and Trade: Virtuous Cycle about to Become Vicious? calculatedrisk.blogspot.com I think most economists are underestimating the impact of the coming housing slowdown. Best to all!

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next