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The Most Accurate Economist On Wall Street Sees A Big Bullish Wildcard For America
TBI ^ | 12-21-2012 | Sam Ro

Posted on 12/21/2012 1:32:51 PM PST by blam

The Most Accurate Economist On Wall Street Sees A Big Bullish Wildcard For America

Sam Ro
Dec. 21, 2012, 2:05 PM

One of the most bullish economic stories in the world has been the recent recovery of the U.S. housing market.

Maury Harris, UBS's Chief U.S. Economist, is particularly optimistic considering the snapback of housing formation, which is now back above 1 million per year.

We recently had lunch with Harris, who is repeatedly recognized as the most accurate economist on Wall Street and is one of Bloomberg's 50 most influential people in the world.

Harris pointed to one housing market "wildcard": investor interest.

During the heyday of the housing bubble, investors had accounted for a whopping 25-30 percent of the housing market.

Harris thinks that the incentive to enter the housing market as an investor is pretty high these days because of the low interest rate environment, which he thanks the Fed for.

You see, as seasoned bonds mature, investors are finding themselves in an unattractive low interest environment.

But one area that's offering attractive income today is the home rental market. And with low borrowing rates, landlords are netting big profits.

"As rents have risen versus home buying costs, the 'landlord ownership rate' has increased," said Harris.

With the Fed expecting to keep interest rates low through at least 2015, investor interest in the housing market could come back in a big way, which in turn could prove bullish for the economy.

Harris expects US GDP to grow 2.3 percent in 2013, which is higher than the consensus.

(Excerpt) Read more at businessinsider.com ...


TOPICS: News/Current Events
KEYWORDS: boom; economy; housing; recovery
Posted yesterday:

Shiller: Housing Hasn't Necessarly Bottomed Yet

I don’t think [a boom] is in the cards. We might see home prices go up a little bit, you know, a little bit above inflation, maybe. Not likely that we’ll see a real boom.”

1 posted on 12/21/2012 1:32:57 PM PST by blam
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To: blam
UBS, the Swiss banking giant, announced a record settlement with global authorities on Wednesday, agreeing to a combined $1.5 billion in fines for its role in a multiyear scheme to manipulate interest rates.

http://dealbook.nytimes.com/2012/12/19/as-unit-pleads-guilty-ubs-pays-1-5-billion-in-fines-over-rate-rigging/

Uncle Sam to UBS: $1.5 Billion and some positive statements from your "analysts" and we'll late you play in the FED/Wall Street casino.

2 posted on 12/21/2012 1:38:17 PM PST by PGR88
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To: blam

This market is not coming back within the lifetime of current baby boomers. It’s done.


3 posted on 12/21/2012 1:46:28 PM PST by kjo (+)
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To: blam
With the Fed expecting to keep interest rates low through at least 2015, investor interest in the housing market could come back in a big way, which in turn could prove bullish for the economy...(emphasis added)

And pigs could fly!

The mindless economic "happy talk" being pumped out by those who know better should be a crime.

4 posted on 12/21/2012 1:59:19 PM PST by DakotaGator (Weep for the lost Republic! And keep your powder dry!!)
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To: blam

The financial media industry seems to have shifted from doom and gloom stories to unrestrained optimism. Just read two in a row.

This is quite bearish.


5 posted on 12/21/2012 2:01:40 PM PST by steve86 (Acerbic by Nature, not NurtureĀ™)
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To: blam

“The Most Accurate Economist On Wall Street” is long on his housing stocks, I bet. I wonder how many suckers he can get?


6 posted on 12/21/2012 2:01:58 PM PST by Cyber Liberty (Obama considers the Third World morally superior to the United States.)
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To: blam

Bullish housing market?

Fueled by Gov’t manipulated interest rates. That’ll end well!


7 posted on 12/21/2012 2:05:20 PM PST by aMorePerfectUnion (Gone rogue, gone Galt, gone international. Gone.)
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To: blam

Bullish?

Is that a word scramble and just missing the letter “t”?


8 posted on 12/21/2012 2:11:16 PM PST by Ghost of Philip Marlowe (Prepare for survival.)
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To: blam
Harris expects US GDP to grow 2.3 percent in 2013, which is higher than the consensus.

2.3% is not exactly boom times. It is pathetic coming out of a recession.

9 posted on 12/21/2012 2:31:27 PM PST by kabar
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To: DakotaGator
It's pretty hard to buy a house when you don't have a job. Housing will go down with everything else once the economy gets hit with the Obama tax increases and obamacare fees.
10 posted on 12/21/2012 3:28:48 PM PST by peeps36 (America is being destroyed by filthy traitors in the political establishment)
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To: peeps36

Bingo!


11 posted on 12/22/2012 9:56:36 AM PST by DakotaGator (Weep for the lost Republic! And keep your powder dry!!)
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