U.S. refinancing boomlet

[Jim Devine <jdevine@xxxxxxxxxxxxxxx>]

from SLATE, 01/02/01:
> USA [TODAY] leads with the boom in mortgage refinancing caused by the
> lowest interest rates in 19 months. (The rate for a 30-year
> fixed mortgate is 7.13 percent, versus 8.64 last May.) The low rates
> result from an infusion of money into the bond market as investors flee
> stocks.

this suggests that the stock market has been draining funds away from more
productive uses of loanable funds.

But note that it's a boom in refinancing, rather than of financing new
house purchases. The growth recession is discouraging the latter?

Jim Devine jdevine@xxxxxxx &  http://bellarmine.lmu.edu/~jdevine