Monday Morning Cup of Coffee takes a look at news across the HousingWire weekend desk with more coverage to come on bigger issues.
William Dudley, leader of the New York Fed and member of the policy-setting FOMC, may announce his retirement as early as next week, sources tell CNBC’s Steve Liesman.
Liesman puts the news into perspective: “Largely under Dudley, the NY Fed was responsible for accumulating the trillions in assets the Fed purchased as part of the quantitative easing program, bringing its balance sheet up to $4.5 trillion.”
The Fed is about to beginning to reduce that massive balance sheet.
“Dudley had told several colleagues he was planning to leave in 2018, and his departure is said not to be related to the decision last week by President Donald Trump to name Fed Governor Jerome Powell as the next Fed Chairman. In doing so, Trump declined to renominate current Chair Janet Yellen, with whom Dudley has worked closely over the past several years.”
Lindsey Piegza, chief economist at broker/banker firm, Stifel, said the White House’s decision to replace Yellen with Powell is amidst “impressive gains in the equity market and relatively solid improvement in the domestic economy, particularly the labor market.”
Piegza states the White House is seeking a chair more likely to continue to usher in an economic recovery:
“With a pro-growth, low rate and reduced regulatory platform in mind, the Trump administration has nominated Governor Jerome Powell to replace Chair Yellen in 2018. Widely viewed as a consensus builder, Powell is expected to be more tolerant of a stronger growth profile and more rapid inflation relative to Chair Yellen who has consistently targeted a “moderate” growth rate. Hoping to stimulate the economy and sustain improvement, the White House is stacking the deck – or should we say Fed – with like-minded officials who will welcome and promote the Trump agenda.”
One expert is recommending that whatever Powell may choose to do, it would serve the Fed well to get out of the forecasting business.
This video below explains it all.
Financial analyst Gary Shilling says the Fed has to get out of the forecasting business pic.twitter.com/lozRbsOz76— Business Insider (@businessinsider) November 5, 2017
Speaking of new leadership, AmeriSave Mortgage announced that Robert J. (Bob) Smith accepted the company’s offer of the position of President, replacing Ed Abufaris who recently announced he was leaving the company.
"Bob joined AmeriSave on November 1st and will be appointed President following receipt of necessary regulatory approvals," the company said in a release.
The National Association of Realtors kicked off its annual conference for real estate agents last week in Chicago. The event runs through today.
Top of the list of topics of discussion for Realtors? The Federal Housing Administration mortgage insurance premium.
Currently, FHA charges borrowers an annual premium of 85 basis points, a figure NAR argues is too high to maintain affordability. Under the Obama administration, FHA was set to reduce the annual premium by 25 basis points, but this reduction was quickly suspended by the Trump administration within minutes of taking office. According to NAR estimates, the lower premium would have put homeownership through FHA-backed mortgages in reach for an additional 30,000 to 40,000 homebuyers.
Another issue on the table was the Department of Housing and Urban Development's pending condo rule. NAR Treasurer Tom Riley spoke about the rule, stating that Realtors have long sought changes to current limitations on owner-occupancy rates, commercial space in buildings and other regulatory burdens.
“Reducing owner-occupancy requirements and increasing allowable commercial space are essential to opening up more affordable housing options for first-time buyers, especially in urban areas,” said Riley. “Making the condo project re-certification process more streamlined and less burdensome is key.”