This Week in Financial Regulation, September 22nd

This Week in Financial Regulation, September 22nd

News and Commentary

At the American Action Forum, Thomas Wade analyzes the FHFA’s decision to end policies limiting government-sponsored enterprises from buying risky mortgages. “In what is primarily a problem of housing supply, increasing housing demand (by making it easier to obtain a mortgage) is necessarily counterproductive.”

In Liberty Street Economics, Andrew Haughwout and Belicia Rodriguez compare today’s housing market with pre-crisis dynamics of 2007-08.

Andrew Haughwout and Belicia Rodriguez also consider the question of a housing bubble. “House prices have risen rapidly during the pandemic, increasing even faster than the pace set before the 2007 financial crisis and subsequent recession. Is there a risk that another dangerous housing bubble is developing?”

At the Bank Policy Institute, Francisco Covas and Paul Calem make an argument for broadening mortgage availability to low-income populations. “This approach would enable a more efficient shift of mortgage credit risk from banks to the private sector and revitalize the private securitization market without relaxing bank capital requirements or inducing a deterioration of underwriting standards.”

In a report at a Federal Housing Agency listening session, Tobias Peter presented a case for Walkable Oriented Development, which could offer “policymakers a sensible middle-of-the-road strategy to building a winning coalition to moderately increase density and to add to housing supply.”

New Research

In a paper for the Federal Reserve, Juan M. Londono, Stijn Claessens, and Ricardo Correa “investigate how central banks’ governance frameworks influence their financial stability communication strategies and assess the effectiveness of these
strategies in preventing a worsening of financial cycle conditions.”

I didn't find this helpful.This was helpful. Please let us know if you found this article helpful.
By |2021-10-04T08:43:15-07:00September 22nd, 2021|Blog, Financial Regulation|