Hutchins Roundup: Mortgage tolerance, greater social distancing and more

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According to You Suk Kim and co-authors of the Federal Reserve Bank of New York, whether borrowers can defer mortgage payments in 2020 depends on who the servicer is. Smaller servicers, non-banks, especially those with less cash, were significantly less likely to facilitate payment deferrals. Borrowers from the most permissive lenders deferred mortgage payments by an average of $300 between April and November 2020. Each additional grace equals approximately $6,000 in deferred payments. If every borrower used these lenders, he would have deferred another $10 billion in payments. The money saved into tolerance was mainly used for preventive savings and non-durable consumption, including spending on daily necessities.

Jose Maria Barrero of Instituto Tecnológico Autónomo de México, Nicholas Bloom of Stanford, and Steven J. Davis of the University of Chicago used a monthly survey of work arrangements and attitudes to find that: About 13% of Americans who have recently worked will not return to their pre-COVID activities after the pandemic is over, such as entering subways, crowded elevators, taxis, ride-hailing services, and indoor restaurants.Additionally, 45% of respondents reported making “substantial” or “partial” efforts to limit pre-COVID activity. Respondents with direct jobs, lower income, and lower education were more likely to report not returning to their pre-COVID activities. We estimate a percentage point decline, resulting in a nearly 1% decline in U.S. economy output in the first half of 2022. For uneducated workers, the wage premium for college graduates fell by 0.9 to 2.5 percentage points in 2022.

Martha Bailey of UCLA, Hannes Schwandt of Northwestern University, and Janet Curry of Princeton University found that there will be more children born in the United States in 2021 than in 2020. The increase ends her 13 years of continuous decline and is particularly surprising in the wake of COVID-19. Because a recession usually lowers the birth rate. The COVID-19 pandemic has lowered the opportunity cost of raising children for many women with more flexible work schedulesMillions of Americans have earned income from pandemic assistance programs. As a result, births for U.S.-born mothers have broken pre-pandemic trends and started increasing from March 2020, nine months after her, due to changes in family planning. Many women who wanted to give birth in the United States were unable to do so due to border closures.This result suggests that the time cost of childbirth is [are] “It’s an important driver of declining fertility rates,” he said, adding, “The phenomenon of women seeking childbearing in the United States is a significant one.”

Monthly consumer price index from January 2020 to September 2022, showing year-over-year percent change (gasoline, food at home, new and used cars, full-service meals and snacks, and all items) line graph. Gasoline plummeted from his high growth of 59.9% in June 2022 to his 18.2% growth in August 2022. Meanwhile, food at home is slowly rising from early 2021 to his current growth level of 13%.

Courtesy of Chart wall street journal

“The EU has developed the concept of open strategic autonomy. One of its main goals is to strengthen the resilience of supply chains. Transformation is not the answer, moving production back to the country and clustering within the country also carries a high degree of risk: imagine earthquakes and floods like the one that hit Japan in 2011. Where? “Even if we do, we cannot completely rule out the possibility that something will interrupt production, and our diverse supply lines act as insurance against such an event.” Joachim Nagel, President of the Deutsche Bundesbank, said:.

“Furthermore, trade provides efficiency through comparative advantage, which deglobalization costs. Openness and resilience are not generally trade-offs, but they are often complementary. As I have shown above, trade is essential to raising living standards, so it is imperative that we reassess our trading partners, production networks and terms of trade, rather than turning our eyes away from global markets. In our view, companies should make these decisions themselves: diversifying their supply chains and avoiding concentration of production in countries where geopolitical tensions could disrupt operations and close borders. , to their own benefit.”


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