Of Interest at the Fed: No One Knows What Will Happen if the Central Bank Raises Rates
American employers added 585,000 jobs in November and December of 2014, according to encouraging jobs reports from the Bureau of Labor Statistics. The growth occurred across the board, and though steady, the recovery remains slow. Americans still hold twice as much housing debt as they did in 2000. If mortgage debt had merely stayed in line with the growth in other prices instead of outpacing inflation, we’d owe a collective $6.6 trillion today on our houses, not $9.4 trillion. We could end up where we were six years ago—with borrowers and lenders alike realizing that they can’t repay their debts.