A housing economist who doesn’t want the Fed to cut
Econ 101 says lower interest rates are good for the housing market. But the chief economist of the National Association of Realtors, Lawrence Yun, worries there could be too much of a good thing. In a recent visit to BusinessWeek (see video), Yun said he fears that if the Federal Reserve cuts rates too much more, it will stir fears of inflation, which will push up rates on 30-year fixed-rate mortgages. Lenders will charge more for loans to make up for the higher inflation they expect. Higher rates on 30-year mortgages would be another blow to the reeling housing market.
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Original Source: www.businessweek.com
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