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Showing posts with label Recession. Show all posts
Showing posts with label Recession. Show all posts
Monday, December 3, 2012
Wednesday, November 21, 2012
Recession Watch: November 2012
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Wednesday, August 24, 2011
Recession Redux?: August 2011
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Sunday, June 19, 2011
Recession Redux?: May 2011
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Wednesday, March 23, 2011
[Furman Center] Mortgage Lending in the Wake of the Great Recession
I am participating panel today that I am told is oversubscribed but I plan to share my thoughts here after the conference is over. Navigating Uncertain Waters: Mortgage Lending in the Wake of the Great Recession hosted by the Furman Center For Real Estate & Urban Policy and The Institute for Affordable Housing Policy.
The panel represents many perspectives on assessing collateral (translation: appraising!). It’s the first time that I am aware of where an event has been held to address the appraisal issue in a constructive way.
Feedback to follow.
Tuesday, February 22, 2011
Recession Redux?: January 2011
With much of the econ-finance talk these days still centered around the possibility of a looming “double-dip” let’s take a closer look at two particularly sensitive and accurate leading indicators of our economic health to see if we can tease out the future trends. First, the Federal Reserve Bank of New York is known to use the yield curve (or more specifically the spread between the 10 year and the 3 month treasury yields) to calculate a probability of recession.
This method appears to have been spearheaded by Professor Arturo Estrella of the Rensselaer Polytechnic Institute and Professor Frederic Mishkin of the Columbia Business School as outlined in the June 1996 issue of Current Issues in Economic and Finance, a journal published by the Federal Reserve Bank of New York.
The yield curve probability method is said to have a nearly perfect track record at predicting recessions some two to six quarters ahead with only one false positive, a period in 1967 that many economists, most notably the late Milton Friedman, considered to have been a credit crunch/mini-recession even though the NBER does not officially recognize it as such.
Another important leading indicator with a solid track record is the Economic Cycle Research Institutes (ECRI) weekly leading indicator (WLI).
When the growth component of the WLI turns strongly negative (< -6) it generally means a notable slowdown or recession is in the offing. So what are these two important indicators saying about our current economic situation? The yield curve spread indicator is indicating that the probability of recession is nearly zero while the ECRI leading index is showing some strengthening signs with the growth component currently at a tepid level of 4.1. Labels: economy, recession, spread rate probability, weekly leading index
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