Federal Reserve rate cuts and the passage of a stimulus package could provide insurance against a recession, particularly if falling house prices spark a major pullback in consumer spending, according to the American Bankers Association's economic advisory committee. "We may be looking at an unprecedented drop in home prices," said Peter Hooper, chief economist at Deutsche Bank Securities. The consensus of the nine economists on the advisory committee is that there will be a "double-digit decline" in house prices as measured by the Standard & Poor's/Case-Shiller housing price index, and prices will not stop falling until 2009. The consensus says there is a 45% chance of a recession this year. They expect that unemployment will rise to 5.3% and the Federal Reserve will cut the target federal funds rate by 100 basis points to 3.25% by midyear. All nine economists say they expect the performance of mortgage and other consumer loans to deteriorate further over the next six months.
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A federal judge in Texas dismissed the Consumer Financial Protection Bureau's medical debt rule and prohibited states from passing their own laws prohibiting medical debt on credit reports.
6h ago -
Dr. Mark Calabria takes on the additional role of chief statistician of the United States; retired Ally Bank executive Diane Morais has joined First Citizens Bancshares' board of directors; MainStreet Bank has promoted Alex Vari to chief financial officer; and more in this week's banking news roundup.
9h ago -
While refinances are behind the latest increases, the pace of purchase activity may be a stronger indicator of where the housing market sits.
11h ago -
The share of economists expecting a September rate reduction grew in the July Wolters Kluwer survey, but the October or later percentage also increased.
11h ago -
Rising home prices and softening sales offer a mixed view of a market that some say is shifting to favor buyers.
11h ago -
The notes are backed by home improvement installment loans originated by approved dealers in Foundation Finance Company's network.
July 11