Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.
+1 212 318 2000
Europe, Middle East, & Africa
+44 20 7330 7500
+65 6212 1000
Societe Generale, the big French investment house, came out with a report today arguing that the Federal Reserve wants to—needs to—prop up the U.S. housing market. The firm e-mailed copies to clients and some journalists. (Sorry, I can’t provide a link to it.) Here are some key sentences:
“About a third of total U.S. job creation over the last year can be attributed to the pickup in [housing] construction and borrowing. … Borrowing … [has] a symbiotic relationship with U.S. bond yields. …
The Federal Reserve cannot afford to frighten the bond market …
So, a sharp rise in bond yields is unlikely over the coming years: home demand is likely to grow strongly, and U.S. house prices most likely will continue to rise rapidly.”
Although the piece isn’t signed, it seems to be coming out of SG’s London office. Not saying I agree with the analysis, but it’s more grist for the mill.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.