VIDEO: Why the Fed can’t fix the housing problem
A Recovery in Housing
Has the long anticipated recovery in housing finally arrived? The latest round of economic data on the housing market points toward improvement. On Wednesday, the National Association of Home Builders (NAHB) released their monthly home builder confidence index. The NAHB/Wells Fargo Housing Market Index... Read the full story
Housing Prices Still in the Tank
The S&P Case-Shiller home price indices were released this morning. On a non–seasonally adjusted basis, home prices rose for a second consecutive month in May, but are still down 4.5% over the last 12 months. After adjusting for seasonality, home prices are down slightly in May. The Case-Shiller... Read the full story
Home Prices Back at Recession Lows
The February Case-Shiller home price indices were released today. The 20-city composite fell 1.1% for the month and is down 3.3% over the last twelve months. Home prices are now back at their April 2009 lows. The average home price is no higher than it was in 2003—that’s 8 years without a gain in... Read the full story
Still No Recovery in Housing
March data for housing starts, building permits, and existing home sales came out this week. All three economic indicators continue to point to a housing market that has yet to enter a sustained recovery. New housing starts and building permits both ticked up in March, but failed to recover the ground... Read the full story
Home Prices Slide in December
The S&P/Case-Shiller Home Price Indices for December were released this morning. Home prices continued their decline in December, falling .4%. In the fourth quarter, home prices fell 1.9% and for the 12-month period ending in December, home prices declined 2.4%. After two home buyer tax credits,... Read the full story
Wilmington Trust “Take-under”
The $10 billion, Delaware-based Wilmington Trust was acquired this week in a “take-under” by M&T bank. The take-under was announced the same day that Wilmington reported a massive unexpected loss due to souring construction loans. The regional banking sector continues to struggle with loan... Read the full story
Bernanke’s Biggest Fear
The Fed created an uproar on Wall Street this week by changing the language in its post-meeting Federal Open Market Committee (FOMC) statement. The FOMC is, of course, the committee that sets monetary policy at the Federal Reserve. The new language that excited investors was the following: Measures of... Read the full story
Don’t Miss This Opportunity
Long-term interest rates are at their lowest level in over four decades. Today, the Treasury can borrow money for 30 years at an interest rate of less than 4%. Adjusted for trend inflation, Uncle Sam is looking at a rate below 1%. Long rates of less than 4% are even more surprising given the sorry state... Read the full story
A Risk Worth Taking
In today’s environment of low interest rates, there are few places to turn to add yield to your portfolio. Sure, you can tie up your money in 30-year Treasury bonds to lock in a 3.70% yield, but you will take it in the neck when interest rates rise. A 1% increase in interest rates will result in a... Read the full story
