The Fed Surprise

As an exercise for the macro student, watch this video starting around minute 30. The video is a brief Q&A with Narayana Kocherlakota, the President of the Minneapolis Federal Reserve Bank.

Then make a prediction for monetary policy going forward.
A) The Fed Tapers or
B) The Fed Waits.

Then read what happened here.

Surprised?

Mortgages

Some evidence that my prognostications were correct:

The areas studied, and the gross metropolitan product growth expected next year, include Appleton at 2.7 percent, Duluth, Minn.-Superior 2.6 percent, Eau Claire 2.8t, Fond du Lac 3.1, Green Bay 2.9, Janesville 3.3, La Crosse 3.1, Madison 3.4, Milwaukee 2.5, Oshkosh 2.7, Racine 2.3, Sheboygan 2.6 and Wausau 2.6.

Diffley said the result is better in Wisconsin because area prices and mortgage values did not climb as much or as rapidly as in other parts of the country.

Even a blind squirrel finds an acorn once and awhile.