The average rate in US home sales has dropped by a whopping 17.3% from the same month a year ago.But that hasn't stopped the number of people who are on a mortgage rising.In the US, home buyers now account for nearly half of all new home sales, up from 44% in January.The number of homes sold has also increased by a staggering 9.3%.In Australia, home sales have jumped by 8.5% from January.That's a ...
By MICHAEL BACHMANNThe Federal Reserve Bank of New York is warning of a “severe” default for consumers in the wake of Hurricane Sandy.
In a report released Thursday, the Federal Reserve said that the financial system could be at risk as much as a quarter of a trillion dollars should the storm continue to wreak havoc and damage homes.
The bank said that, without further action, default on debt obligations could result in the loss of at least $1.8 trillion in mortgage-backed securities, and another $1 trillion in other debt.
That would represent about 0.8 percent of total U.S. household debt, or about $929 billion, the Fed said.
While the storm has damaged a substantial portion of the nation’s coast, it is also caused significant damage to areas of the country where homes are located, including in New York, Florida, and New Jersey.
The storm has also brought flooding to areas in the Northeast and parts of the Midwest, with up to half of the city of New Orleans submerged.
The report was issued after the Fed sent its top policymakers to Washington to meet with representatives of key financial institutions to discuss how to prevent another storm, including another crisis in the financial sector, as well as other major disasters, such as a nuclear war, or an economic downturn.
The Federal Open Market Committee, which sets the federal interest rate, is expected to keep interest rates near zero until late November.
The Fed has said it would keep its benchmark overnight interest rate near zero if it were in a recession.