[PEN-L:33247] Re: How Much Housing Credit Is Too Much?

[Michael Perelman <michael@xxxxxxxxxxxxxxxxx>]

The one factoid that struck me was:

Since early 2001, outstanding residential mortgage debt has ballooned from
an amount equal to 49.0 percent of GDP to a level ($6.2 trillion) equaling
59.0 percent of GDP.

On Thu, Dec 19, 2002 at 02:41:34PM -0500, Finmktctr@xxxxxxx wrote:
> New from the Financial Markets Center
> Flow of Funds Review & Analysis: Q3 2002
> As battered investors moved their funds out of stocks and into deposits,
> banks assumed the dominant role in a massive run-up of mortgage debt that has
> helped maintain economic growth. But if interest rates rise or housing prices
> correct, the price of this build-up could be steep for households, small
> businesses, institutional investors and others. Is residential real estate
> following the same path Nasdaq traced in the late '90s?  And, if so, what
> should the Fed be doing about it?  Get the details in Jane D'Arista's
> quarterly review of the Fed's financial statistics.
>
> http://www.fmcenter.org/pdf/flow12-02nocov.pdf
>

--
Michael Perelman
Economics Department
California State University
Chico, CA 95929

Tel. 530-898-5321
E-Mail michael@xxxxxxxxxxxxxxxxx