 |
|
|
|||||
Want more housing market stories from Lance Lamberts ResiClub in your inbox? Subscribe to the ResiClub newsletter. Speaking Tuesday at the National Association for Business Economics meeting in Philadelphia, Federal Reserve Chair Jerome Powell offered his clearest reflection yet on the Feds pandemic-era mortgage bond buying. He acknowledged that the central bank may have kept purchasing mortgage-backed securities (MBS) for too longbut he also suggested that those purchases may have had a smaller effect on the housing markets trajectory than some assume. Regarding the composition of our purchases, some have questioned the inclusion of agency MBS purchases given the strong housing market during the pandemic recovery,” Powell said. “The extent to which these MBS purchases disproportionately affected housing market conditions during this period is challenging to determine. Many factors affect the mortgage market, and many factors beyond the mortgage market affect supply and demand in the broader housing market. With the clarity of hindsight, we could haveand perhaps should havestopped asset purchases sooner,” Powell continued. “Our real-time decisions [in 2020-2021] were intended to serve as insurance against downside [economic] risks [following the pandemic]. From 2020 through 2021, the Fed was purchasing hundreds of billions of dollars worth of Treasuries and MBS. Those actionspart of its quantitative easing (QE) programwere designed, in theory, to lower long-term borrowing costs and support financial stability at a time when the policy short-term rate was also pinned near 0%. When the Fed buys long-term bonds like Treasuries or MBS, it creates extra demand for those securities. When bond prices risesay for MBSthen the yieldsor mortgage rates for MBSfall. They move inversely. Critics have argued that those MBS purchases added unnecessary fuel to a housing market already running red-hot during the Pandemic Housing Boom. They contend that by continuing to buy MBS deep into 2021, the Fed artificially suppressed mortgage rateswith the average 30-year fixed mortgage rate hitting an all-time low of 2.65% in January 2021and helped intensify competition among buyers, worsening affordability. Powells comments on Tuesday acknowledged, to a small degree, an element of that critique, but also suggested that the actual impact may have been smaller than many assume. He appeared to imply that other powerful factorssuch as the pandemic-era surge in demand for more space, the unlocked WFH arbitrage (including the domestic migration wave it triggered), and pandemic-era savingswere also at play. Of course, Powell has repeatedly stated that he simply believes there arent enough homes in the country. While the Fed cant undo its 2021 asset purchases, Powell acknowledged that, going forward, the central bank could be more nimble in adjusting its balance sheethinting that future QE programs might be shorter or more targeted. Stopping [QE asset purchases, including MBS] sooner could have made some difference, but not likely enough to fundamentally alter the trajectory of the economy,” Powell said on Tuesday. “Nonetheless, our experience since 2020 does suggest that we can be more nimble in our use of the balance sheet, and more confident that our communications will foster appropriate expectations among market participants given their growing experience with these tools. No appetite for using MBS to address the current housing strain Some online observerslets be honest, mostly those tied to the mortgage and housing industrieshave floated the idea that the Fed could start buying MBS again to help bring down todays elevated mortgage rates. But when asked on Tuesday whether renewed MBS purchases might be used to improve housing affordability, Powell firmly rejected the notion. “We look at overall inflation, we don’t target housing prices. And we’d certainly not engage in mortgage-backed security purchases as a way of addressing mortgage rates or housing directly,” said Powell. “That’s not what we do.
Category:
E-Commerce
Uber’s U.S. drivers and couriers have a new way to earn extra money. The ride-hail app announced on Thursday a new pilot program that will offer gig workers the opportunity to train artificial intelligence (AI) through so-called “digital tasks.” They include simple, quick tasks for workers such as uploading photos, recording themselves speaking in their native language, and submitting documents written in different languageswhich are then fed into AI models. Uber already offers this for gig workers in India. “A lot of these tasks are digital, meaning you can do them from your phone . . . from anywhere, and at the same time create earnings opportunities,” Sachin Kansal, Uber’s chief product officer, said at the company’s “Only on Uber” event in Washington, D.C. on Thursday. “Drivers have asked for more ways to earn, even when they’re not on the road,” CEO Dara Khosrowshahi said in a statement to Business Insider. “[We’re] giving drivers more ways to earn during downtime.” [Image: Uber] The pilot, which allows gig workers to complete quick digital tasks in the Driver app, is powered by Ubers AI Solutions Group. How Uber’s “digital tasks” work The digital tasks are only available to drivers and couriers whove opted in. Once they’ve signed up, they will occasionally see invitations to complete the tasks in the Opportunity Center. Once available, users can view the full list before they begin (each task is optional)including an estimate of how much time it will take and how much they will earn. After the tasks are completed, payment is added within 24 hours. Uber Financials Uber Technologies, Inc (UBER) was trading down nearly 3% in afternoon trading on Thursday. Uber’s reported second quarter earnings, for the period ending June 30, beat estimates with revenue of $12.65 billion (versus estimates of $12.46 billion). Earnings per share (EPS) came in at 63 cents. At the time, the company also announced the authorization of a $20 billion stock buyback.
Category:
E-Commerce
After months of uncertainty, some federal student loan borrowers will soon have their debt canceled. But theres a hook: You must be enrolled in a very specific program and have made sufficient payments to qualify. Some borrowers have been receiving notices in recent weeks that read: You are now eligible to have some or all of your federal student loan(s) discharged because you have reached the necessary number of payments under your Income-Based Repayment (IBR) Plan. The IBR plan, first introduced in 2007, offers debt cancellation after 20 or 25 years of repayment, depending on the age of the loans. Nearly 2 million borrowers were enrolled in this program as of the second quarter, according to Federal Student Aid figures. Notices emailed to borrowers go on to inform them that the U.S. Department of Education will work with their loan servicer to process the discharge over the next several months. If for some reason borrowers want to opt out of IBR forgiveness, they must contact their loan servicer by Oct. 21. While advocates for debt relief may cheer the news, these notices indicate that IBR forgiveness has resumed after about three months. In July, the Federal Student Aid quietly announced that forgiveness had been paused so its systems could be updated to accurately the number of months paid, blaming litigation related to a forgiveness plan instituted during former President Joe Bidens administration. As a result, the debt forgiveness notices are simply the resumption of the IBR program, rather than a new forgiveness plan. On the campaign trail last year, President Donald Trump called student loan forgiveness vile and not even legal. Education Secretary Linda McMahon has vowed that a mass forgiveness program won’t happen during her tenure. These notices have gone out even amid the ongoing federal government shutdown. The Department of Education did not respond to a request for comment from Fast Company. While a formal notice is the best way to confirm that your federal student loan debt will be cancelled, here’s how to know if you may qualify. BORROWERS MUST BE ENROLLED IN IBR PLAN The forgiveness notices sent out in recent weeks are only going to student loan borrowers who are enrolled in the income-based repayment plan, which capped monthly payments at a certain percentage of borrowers discretionary income . Borrowers enrolled in other repayment plans, even other income-driven repayment plans, may not see relief soonif ever. That’s because other plans have been phased out or are held up by litigation in courts. CHECK NUMBER OF LOAN PAYMENTS Only those borrowers enrolled in an IBR plan who have made a sufficient number of loan payments are eligible for forgiveness. If you took out your federal student loans before July 1, 2014, then you must have made consistent monthly payments300 in totalfor 25 years. If you took out loans after that date, the threshold drops to 240 payments over a 20-year period. Many borrowers switch repayment plans over timeand you may still be eligible for IBR forgiveness for payments made while you were enrolled under other plans. It may be tempting to assume you’ve qualified for debt forgiveness based on your records of payments, but you should continue making payments as normal until you receive official notice. EXPECT MORE SHOWDOWNS ON STUDENT LOANS As the notices to borrowers indicate, full forgiveness may take several months. What’s more, the government shutdown may further delay loan forgivenessand it has snarled other forgiveness efforts, including a legal challenge brought by the American Federation of Teachers regarding the Department of Educations denial of rights to federal student loan borrowers for forgiveness opportunities that were mandated in their loan terms. Finally, expect more showdowns related to federal student loan debt to come. Last week, Politico reported that the Trump administration is considering selling parts of the federal governments $1.6 trillion student loan portfolio to private investors. Such a move might change current repayment safeguards, along with the potential for loan forgiveness in the future.
Category:
E-Commerce
All news |
||||||||||||||||||
|
||||||||||||||||||