The Good, the Bad and the Maybe Ahead of Spring Home Buying

By Mark Fleming on March 19, 2021
In February 2021, housing market potential increased to its highest level since 2007, despite the largest month-over-month jump in mortgage rates since October 2019. Housing market potential rose 1.3 percent in February relative to the previous month, and 12.2 percent year-over-year. While rising average tenure length was the largest drag on ... Read More

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Is the Economy Stuck in Neutral?

By Odeta Kushi on February 3, 2021
When determining where to set the federal funds rate, the Federal Reserve studies a multitude of models and analyses, including the neutral rate of interest. The neutral “what” you ask? The neutral rate of interest is the short-term interest rate that would prevail when the economy is at full employment and stable inflation. The Fed may choose to ... Read More

Interest Rates Federal Reserve

Are Negative Mortgage Rates on the Horizon?

By Odeta Kushi on March 18, 2020
Given both emergency rate cuts of the Federal Reserve and the recent economic uncertainty due to the spread of the Coronavirus, the 10-year Treasury yield dropped to its lowest level in 150 years, according to Nobel Laureate Robert Shiller. For added perspective, that takes us back to the time of Ulysses S. Grant’s presidency. The 10-year Treasury ... Read More

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What Global Uncertainty Means for the Housing Market

By Mark Fleming on January 10, 2020
Global events and uncertainty, such as the conflict between the U.S. and Iran, clearly impacts geopolitical relations, but also impacts the U.S. economy, and more specifically, the U.S. housing market. How? Against a backdrop of uncertainty, investors worldwide look for a safe place to put their money. U.S. bonds, backed by the full faith and ... Read More

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Why Our Economy Is Generating More Investment Growth in IP than IT

By Odeta Kushi on October 16, 2019
Important, but easy to overlook shifts in investment trends may be contributing to our current era of low interest rates. An excess supply of global savings relative to the demand for that money for investments is driving down interest rates, which can be thought of as the price of money. The neutral rate of interest, which is monitored by the ... Read More

Interest Rates Federal Reserve

What is the Neutral Rate of Interest and How Does it Influence the Federal Reserve?

By Mark Fleming on September 17, 2019
Many people understand the “natural rate of unemployment,” and if you don’t, you can probably guess what it is – the rate of unemployment when the labor market reaches equilibrium. What many people don’t know is that a similar concept exists in monetary policy. Read More

Interest Rates Federal Reserve