Casey Mulligan's excellent defense of Chicago School is now in print in Berkeley's Economic Press (here) - a must read.
Another interesting read is on Bloomberg (here) - hat tip to Patrick. My personal view - 3-3.5% growth for 2010 is possible for the US. Major risk factors to these figures are -
- unemployment - rampant and stubborn;
- interest rates reversion upward; and
- resets of Alt-A mortgages - peaking in 2010...
- Mortgage defaults continuing - these put families off the track of paying 2-2.5K monthly in mortgage costs for negative equity dwellings and into renting same properties for 1-1.2K per month, generating disposable income increases of up to 1,050 per month (once interest relief is counted); and
- The Federales are yet to inject some 50% of the allocated economic stimulus.
Related to Alt-A's and ARMs is another article in Berkeley's Economic Press latest issue of the Economists' Voice (here) - few charts from it tell the story of the rising tide of ARMs hitting the fan:
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiJRhQsiqR7K3-uPA7my13GVGC2KpEw0SP98pVt5SpQNP3L1NSBn92FA5jyZNSwisczjL4zTs539fIFsYcBEEr8GLsVacXD5mCxKNhStpcV-zxUJIhiAngE-F2PYoRvO5JK2-Ywb69Eka0k/s400/Picture+2.png)
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj3dqPBnZonSYBXhMdSSoIe1WvvkSZf57CDZeohqCS3uqQxubj0QKQ2Ui_GGNeTTZGKovZXnCA9FhJINkM6_PG56dh4IlWseXr5seEUm7hyphenhyphenUSBYVNSMuhYXkm6NdR-WRulz6aJ4tJS46oPY/s400/Picture+1.png)
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiquQPW3lSwzXZryL8O1pz42cyFGE_k7JsXTZ4d85WxMDJidweYINSaV5-a_6cmqQCgVNgQeJ3bzH4f2P3lBKDyBiF8-gMuivNo0OcfTR9HYtqDFPWHsewSDc-y2UY5xRJwekXwQhFu7bcj/s400/Picture+3.png)
No comments:
Post a Comment