Ethan Harris
Ethan Harris
economy engines face growth healthy housing sector
This is a sector that should be one of the engines of growth and should keep the economy healthy in the face of the weakening housing market.
becoming belongs biggest boom center economic engine estate front future goes growth hot housing market page reason reports research risk topic
Real estate is a topic that has vaulted to center stage, ... The real reason the topic is hot and belongs on the front page of research reports is that the housing market is becoming more of an engine of economic growth, but is also the biggest risk to future growth if the boom goes bust.
coming eventually housing impact seeds slow
Eventually that will slow down the U.S. consumer. We've got the seeds of a slowdown coming out of the housing market, but it hasn't really had that much impact yet on the economy.
delays housing impact might prices tend turn whatever
Housing prices tend to turn very slowly, and that delays whatever impact they might have on the economy.
cost economists economy faster housing income indicator market mortgage picks possibly predict quickly ratio slowly typical
The indicator that economists use to predict the housing market is the affordability index -- the ratio of monthly income to monthly mortgage payments. As the economy picks up, the typical family's monthly income will slowly accelerate, but the monthly mortgage cost is quickly jumping, much faster than income could possibly move.
budget china congress course gradual growth happen ideal less none percent pressure three works
In an ideal world, three simultaneous gradual adjustments would happen. The U.S. eliminates the budget deficit, China revalues by 30 percent and China works to rebalance growth more to consumption and less to exports. Of course none of this will happen and the pressure for protectionism from Congress grows.
friendly inflation major signals warning
It's not as friendly as some of the other inflation numbers, but it's just one indicator. We have no inflation warning signals from any of the other major inflation indicators.
erosion explosion question sudden
It's not a question of a sudden explosion in prices. It's more an erosion of the low-inflation psychology.
average bills bulk burden confidence consumer cut debt driver growth leaving less past paying people picking several slow taken tax truth wage
Everyone is all zeroed in on the consumer now, but the truth is that the consumer isn't the driver now. Confidence is picking up, but still at average levels. Wage growth is slow and the bulk of the tax cut is already in place. Finally, with all the debt people have taken out over the past several years the burden of paying monthly bills is leaving less for discretionary spending.
bond looking market relief report
The bond market went into this report looking for disaster. I think there's a sense of relief in the bond market.
best cuts economy maintain move promise quarter rate remains
The best tack is to move by a quarter point, with the promise that there will be more cuts to come if the economy remains weak. You can't maintain that promise with big bulky rate cuts.
basic consumer medium near ok risk term
The basic story of the consumer is that he's OK in the near term and at risk in the medium term.
adjustment economy effect fairly higher oil prices problem style top
The adjustment to higher prices has been fairly orderly. It's not a 70's style shock. Oil prices do have an effect on the economy but it's not dramatic. It's a problem but not at the top of the list.
closely dictionary figure general hold keeping keeps language less rates sounds study though tone
They keep fiddling with the language, and the general tone of the directive keeps getting a little less dovish. Being 'patient' sounds a little less like they're keeping rates on hold than a 'considerable period' -- though you'd need to study a dictionary closely to figure that out.