Hi, I have a quick survey for my real estate class that I need answered by one person that works in real estate and one person that works in banking/finance. Thanks if anyone can help!
Government, Consumers, Realtors, Lenders, Wall Street, Secondary Market
1.) Rank the six groups above in order of blame for the collapse of the U.S. housing market in 2008. For the one ranked most to blame, why? And for the one ranked least to blame, why?
2.) What is your solution to the current economic crisis?
3.) How long will it take for the economy to recover? Or has it already recovered?
Americans are able to spend more on housing and it is driving up prices. We had the highest savings rate during the pandemic. People moved in with family, isolated, and saved a TON of money. This money is now being dumped into down payments. Housing prices have elevated but debt is still a significantly small % of disposable income (https://fred.stlouisfed.org/series/TDSP)
So, with this large savings rate and a 285% increase in the SP500 over the past 10 years, people have a ton of money. Seriously. On top of these massive gains, inflation is elevated as we all know and have heard and will continue to hear at our Thanksgiving dinners. Inflation at 6% makes debt extremely cheap. If you have a 3% loan and inflation is 6%, you're making 3% off the person (complicated argument, happy to discuss).
So, you have 40-60 year old folk downsizing with massive 401k accounts and other savings vehicles... You have an environment where mortgages are 3% and inflation is 6%... You have a ton of money pumped into the economy (https://fred.stlouisfed.org/series/M1SL)... How is this bubble going to disappear? Even with mortgage rates rising to 4.5 or 5%, inflation doesn't seem to be going anywhere.
This is my opinion, and it is nothing more than an opinion. I have a background in economics and finance studying capital markets, but I'm happy to hear popular talking points or theories you all believe in for why we are in this bubble. We very well could be in a bubble.
Testimony of Gary Gensler
Before the United States Senate
Committee on Banking, Housing, and Urban Affairs
Sept. 14, 2021
Washington, D.C.
Good afternoon, Chairman Brown, Ranking Member Toomey, and members of the Committee. I’m honored to appear before you today for the first time as Chair of the Securities and Exchange Commission. I’d like to thank you for your support in my confirmation this spring. As is customary, I will note that my views are my own, and I am not speaking on behalf of my fellow Commissioners or the staff.
We are blessed with the largest, most sophisticated, and most innovative capital markets in the world. The U.S. capital markets represent 38 percent of the globe’s capital markets.[1] This exceeds even our impact on the world’s gross domestic product, where we hold a 24 percent share.2
Furthermore, companies and investors use our capital markets more than market participants in other economies do. For example, debt capital markets account for 80 percent of financing for non-financial corporations in the U.S. In the rest of the world, by contrast, nearly 80 percent of lending to such firms comes from banks.[2]
Our capital markets continue to support American competitiveness on the world stage because of the strong investor protections we offer.
We keep our markets the best in the world through efficiency, transparency, and competition. These features lower the cost of capital for issuers, raise returns for investors, reduce economic rents, and democratize markets. That focus on competition is in every part of the SEC’s work, particularly with respect to market structure.
We can’t take our remarkable capital markets for granted, though. New financial technologies continue to change the face of finance for investors and businesses. More retail investors than ever are accessing our markets. Other countries are developing deep, competitive capital markets as well.
The SEC is a remarkable organization. In just under five months, I have gotten to know many of the dedicated 4,400 people across 12 offices. Our agency covers nearly every part of the $110 trillion capital markets. Those markets touch many Americans’ lives, whether they’re investing for their future, borrowing for a mortgage, taking out an auto loan, or taki
... keep reading on reddit ➡Introduced: Sponsor: Sen. Raphael Warnock [D-GA]
This bill was referred to the Senate Committee on Veterans' Affairs which will consider it before sending it to the Senate floor for consideration.
A real story in my city:
I can almost guarantee that some homeless people will be panhandling and begging at the local supermarket right this minute or today just as everyday and yet less than two miles away sits a rich neighborhood with multi million dollar mansions.
This is one small example of extreme disparity in American society. I feel that adequate housing should be considered human right within the context of a wealthy, first world country but nobody else seems to agree.
What is your opinion?
Introduced: Sponsor: Sen. Brian Schatz [D-HI]
This bill was referred to the Senate Committee on Banking, Housing, and Urban Affairs which will consider it before sending it to the Senate floor for consideration.
