Briefing
Understanding the Surge in Commercial Real Estate Lending
Muething, Catherine; Fessenden, Helen (2017-08)
U.S. banks have increased their commercial real estate (CRE) lending significantly in the past five years. Economists and regulators note that some positive factors are driving this trend, but they also see potential risks. Analysts at the Richmond Fed have found that some banks could be especially vulnerable if economic conditions deteriorate. These include institutions that are in certain major urban areas and have high concentrations of CRE loans, rapid CRE loan growth, and heavy reliance on "noncore" (or illiquid) funding. But the analysts also conclude that, overall, banks' CRE exposures ...
Richmond Fed Economic Brief , Issue August

Briefing
How Couples Approach Portfolio Allocation
Lazaryan, Nika; Neelakantan, Urvi; Fessenden, Helen (2017-02)
The classical theory of household portfolio allocation finds that the share of household wealth invested in risky assets is independent of the level of household wealth. However, this prediction is at odds with empirical observations. This Economic Brief presents findings that reconcile the two. A model in which a household's portfolio allocation reflects the preferences of both spouses, adjusted for the bargaining power of each spouse, predicts that the wealthier a household becomes, the greater the share of its wealth will be invested in risky assets.
Richmond Fed Economic Brief , Issue February

Briefing
The Roots of ‘Bubbly’ Recessions
Fessenden, Helen; Phan, Toan (2018-04)
A downturn following the collapse of an asset bubble ? an episode of speculative booms in asset prices ? can be severe and sustained, with output and employment often lower than in the prebubble economy. This Economic Brief considers some possible theoretical explanations. It argues, based on insights from a simple economic model, that the interaction among financial frictions, wage rigidity, and the constraints of monetary policy near the zero lower bound is a key source of inefficiency in large bubbles. One potential remedy is to regulate speculative investment on bubbly assets so that ...
Richmond Fed Economic Brief , Issue April

Journal Article
A Bridge Too Far?
Fessenden, Helen (2015-07)
In a novel move, a new transportation-funding law is sending billions from the Fed's surplus account to help pay for roads, bridges, and mass transit
Econ Focus , Issue 3Q , Pages 4-7

Journal Article
ECONOMIC HISTORY: The Last Big Housing Finance Reform
Fessenden, Helen (2015-01)
Policymakers concerned over the future of Fannie Mae and Freddie Mac may find a cautionary tale in the last time policymakers sought to reform the enterprises more than two decades ago.
Econ Focus , Issue 1Q , Pages 31-34

Journal Article
Time to Unwind
Fessenden, Helen (2017-07)
This fall, the Fed is taking initial steps to unwind a signature post-recession stimulus policy by trimming back its massive balance sheet.
Econ Focus , Issue 3Q , Pages 30-30

Briefing
The Cost of Fed Membership
Richardson, Gary; Fessenden, Helen (2016-02)
Since the Federal Reserve's founding, it has paid a regular dividend to banks that are members of the Federal Reserve System in exchange for those banks holding stock in Federal Reserve Banks. Recent transportation legislation reduced these dividends and used the savings to help fund the bill. While this move provided a short-term financing fix, it also raised a much bigger question of whether banks will want to remain members of the Federal Reserve System.
Richmond Fed Economic Brief , Issue Feb

Journal Article
The Crop Insurance Boom: A long-standing U.S. farm support program now covers almost every almost crop — but it attracts more and more critics as well
Fessenden, Helen (2015-01)
Econ Focus , Issue 1Q , Pages 17-20

Journal Article
Research Spotlight: Revisiting the 'Paradox of Choice'
Fessenden, Helen (2014-10)
"Paying Attention or Paying Too Much in Medicare Part D." Jonathan D. Ketcham, Claudio Lucarelli, and Christopher A. Powers. American Economic Review, January 2015, vol. 105, no. 1, pp. 204-233.
Econ Focus , Issue 4Q , Pages 11-11

Journal Article
Shifting into Neutral: In 1994, the Federal Reserve launched a pre-emptive strike against inflation in a series of interest rate hikes that drew controversy at the time
Fessenden, Helen (2015-04)
Econ Focus , Issue 2Q , Pages 4-7