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Boston Federal Reserve

Boston Federal Reserve. The New England District. By: Alan Sanders & Jackson Ta. GDP Growth. Economic Factors. Housing Sector – Subprime Crisis and Declining Asset Value Fear of Inflation Through High Gas Prices Recent Surge in the Unemployment Rate. U.S National Home Price Index.

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Boston Federal Reserve

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  1. Boston Federal Reserve The New England District By: Alan Sanders & Jackson Ta

  2. GDP Growth

  3. Economic Factors • Housing Sector – Subprime Crisis and Declining Asset Value • Fear of Inflation Through High Gas Prices • Recent Surge in the Unemployment Rate

  4. U.S National Home Price Index Information Taken From - S&P/Case-Shiller Home price Indices

  5. History of Avg. Home Prices In New England District Information Taken From - S&P/Case-Shiller Home price Indices

  6. Gas Prices In The U.S & New England District Information Taken From - www.eia.doe.gov/oil_gas

  7. Historical U.S Inflation Rates Taken From The Bureau Of Labor Statistics

  8. Unemployment In The U.S

  9. Unemployment Rates in New England District

  10. http://www.frbsf.org/publications/economics/fedviews/Fedviews_slides_June%202008.pdfhttp://www.frbsf.org/publications/economics/fedviews/Fedviews_slides_June%202008.pdf

  11. Low Correlation between High Oil Prices and Core Inflation • High oil prices are unlikely to create higher prices within the economy. • The past twenty years indicates a low correlation between oil prices and the core rate of inflation. • A rise in oil prices will lead to greater conservation efforts and slower economic growth. As a result the demand for energy will decrease. • High oil prices will also spur technological innovation, and will drive production of energy substitutes. Therefore the supply of energy will increase as well.

  12. Sources: http://tonto.eia.doe.gov/dnav/pet/pet_pri_top.asp http://www.bos.frb.org/economic/neei/neeidata.htm#prices

  13. Mortgage Relief Initiative • The Federal Reserve Bank of Boston has partnered with the Massachusetts Bankers Association in an effort to reduce the impact of the credit crisis. • Participating banks are helping eligible homeowners refinance their loans. Source: http://www.wickedlocal.com/wakefield/news/x379971261/Mortgage-relief-initiative-expands-and-evolves

  14. Recommendations • Do Nothing: the economy is experiencing pains due to increased oil prices, higher unemployment, and a weakening of the housing markets. Economics will solve these problems naturally. • Eventually tighten the money supply. This will establish credibility within the financial markets.

  15. http://www.frbsf.org/publications/economics/fedviews/Fedviews_slides_June%202008.pdfhttp://www.frbsf.org/publications/economics/fedviews/Fedviews_slides_June%202008.pdf

  16. http://www.frbsf.org/publications/economics/fedviews/Fedviews_slides_June%202008.pdfhttp://www.frbsf.org/publications/economics/fedviews/Fedviews_slides_June%202008.pdf

  17. Keep an eye on Foreign Central Banks • International Banks have been tightening their supply of money. • The People’s Bank of China recently raised bank reserve requirements. • The European Central Bank may be looking to raise rates in response to the cooled U.S. market.

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