Ben Bernanke Mentions Housing Market in Barcelona
Ben Bernanke isn’t in Barcelona, but he delivered remarks to an international monetary conference being held there. This morning, amidst concerns about the latest bank sector issues and how they will continue to affect the US economy and the mortgage market, Bernanke continued his policy of making upbeat comments designed to inspire confidence in the market.
Bernanke insisted that the economy is likely to turnaround in the second half of the year. He also addressed such concerns as inflation, interest rates, the US dollar and the stock market. Bernanke also mentioned that the housing market slump could continue to put hurdles in the way of the economy, reports the Associated Press:
Until the slumping housing market and falling home prices show “clearer signs of stabilization,” there will continue to be threats to the economic growth getting back to full throttle, he said. Moreover, recent increases in oil prices pose “additional downside risks to growth,” he said.
Bernanke did imply that housing prices are starting to stabilize, and that we could be nearer the end of the current downward trend. He credited the recent interest rate cuts with loosening the money supply and providing a catalyst for growth. However, he did indicate that further rate cuts are unlikely. All of this could mean that mortgage lenders start loosening up a bit with their requirements, but it really might be better if they remained tough.
The remarks did provide a boost to the US dollar on the FX market, as well as facilitate a bump in a stock market struggling to recover from yesterday’s banking sector shenanigans. However, it remains to be seen whether or not these changes will promote long-term economic stability. Additionally, we will have to wait and see with regard to whether or not this helps the mortgage market.
What do you think about the economy? Do you think the housing market and the mortgage market crisis is coming to an end?
Tags: housing market, mortgage market, home mortgage loan, mortgage loan blog,
Ben Bernanke, interest rate cuts, mortgage lenders
