Excerpts
"Whitney, the author of The Fate of the States, also downplayed the role of historic low interest rates in the more recent uptick in the U.S. housing market.
"I don't think the mortgage market is responding to low [interest] rates anymore," she says. "Very few first-time buyers [are] going out with a mortgage and buying [a] home. There's no correlation there that once was between mortgage rates and home purchasing [in the U.S.]"
If anything, she adds, "low interest rate are killing [U.S.] retirees; people living on a fixed income are really struggling."
''Interestingly, Whitney forecasts a bright and prosperous future for resource-rich states in the U.S. - North Dakota, Nebraska, Texas, Wyoming, among others - and the Canadian province of Alberta''.
These American states, which she refers to as the "new geography of American prosperity," hadn't experienced a housing crisis as severe as the rest of the country.
"Those states have agrarian roots [and] are used to major booms and busts and have managed themselves much more conservatively on a fiscal basis," she says. "And because of that they [entered] into the [recent] bust with a lot more dry powder."
"These states are rich in resources and businesses are making long-term investments," she says. "Businesses are building new facilities in these states and are making 30-year investments. It's not coincidental that [these states] have unemployment rates that are half that of Nevada and California."
This, adds Whitney, has ripple effect which draws greater inflows of skilled people, creates new jobs, prompts infrastructural developments, all of which ultimately provide a boost to housing markets''
Source: Howard Green Interview to Meredith Whitney in bnn.ca
This, adds Whitney, has ripple effect which draws greater inflows of skilled people, creates new jobs, prompts infrastructural developments, all of which ultimately provide a boost to housing markets''
Source: Howard Green Interview to Meredith Whitney in bnn.ca
