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June 13, 2007
Three items relating to the Fed
So I was checking my Reuters news feed and these three caught my eye.
Fed mulling ban on some mortgage lending: Kroszner
"We will also seriously consider whether there are mortgage lending practices that should be prohibited," Kroszner said in prepared remarks at a U.S. House of Representatives Financial Services Committee discussion on consumer protection.
Kroszner said the Fed was specifically eyeing 'stated-income' loan applications and prepayment penalties, as well as considering whether lenders should require monthly payments of annual fees like taxes.
...
"We must be careful, however, not to curtail responsible subprime lending or beneficial financing options for consumers," Kroszner said.
Meanwhile, south of the border, the former Fed chair gets the newswires buzzing...
Greenspan: Disinflationary process may be reversing
MEXICO CITY (Reuters) - Former Federal Reserve Chairman Alan Greenspan on Wednesday said a rise in the cost of Chinese goods imported into the United States may be a signal a long disinflationary trend may be reversing.
"That is the first sign that I have seen that disinflationary pressure ... may be turning around finally," the former U.S. central bank chief said, referring to U.S. data released earlier on Wednesday.
His comments came after the U.S. Labor Department on Wednesday released data showing that U.S. import prices for goods from China rose 0.3 percent in May, the largest monthly gain since this measure was first published in January 2004.
Speaking to a business exposition via videoconference, Greenspan said it was inevitable that at some point the downward pressure on inflation stemming from the opening of emerging economies would come to an end.
Back in Washington, the Beige Book was released.
Fed's Beige Book: Economy expanded through May
WASHINGTON (Reuters) - Economic activity expanded from mid-April through May, with a number of areas reporting stronger growth, the Federal Reserve said on Wednesday.
Seven Fed districts described growth as modest or moderate, while others reported growth as moderately strong, edging up, or somewhat faster than in recent months, according to the Fed's Beige Book summary of anecdotal economic conditions.
The Fed said overall wage pressures had not increased, but added that there were "significant" price increases for energy-related products.
However, districts generally did not indicate an increase in overall price pressures, the U.S. central bank said.
You can read the entire Beige Book at the Fed's website. With the exception of residential real estate, it's a fairly good report. Only Richmond reported a decline in manufacturing, and more than half the districts reported increased commercial real estate leasing activity. Price pressures are still clouded by higher energy prices nationwide and higher materials prices in some areas. Nothing in the report changes my assessment of where the Fed is heading for the rest of this year.
Posted by William Polley at June 13, 2007 02:41 PM
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