Search Results
Journal Article
Forecasting and modeling the U.S. economy in 1986-88
Journal Article
SPDAs and GICs: like money in the bank?
We argue that changes in the life insurance industry have created a nontrivial moral hazard. We document the industry's shift from sales of life insurance to sales of mainly rate-of-return oriented investments like single premium deferred annuities (SPDAs) and guaranteed investment contracts (GICs). We describe the system of explicit and implicit guarantees that state governments and the industry provide to SPDA and GIC investors. We argue that these guarantees create moral hazards that have contributed to insurance company failures and misallocation of resources. We summarize reformers' ...
Report
Periodic linear-quadratic methods for modeling seasonality
Optimal linear regulator methods are used to represent a class of models of endogenous equilibrium seasonality that has so far received little attention. Seasonal structure is built into these models in either of two equivalent ways: periodically varying the coefficient matrices of a formerly nonseasonal problem or embedding this periodic-coefficient problem in a higher-dimensional sparse system whose time-invariant matrices have a special pattern of zero blocks. The former structure is compact and convenient computationally; the latter can be used to apply familiar convergence results from ...
Working Paper
The role of non-owner-occupied homes in the current housing and foreclosure cycle
Non-occupant homeowners differ from owner occupants in that they tend to have lower-risk credit characteristics, such as higher credit scores, but may also have weaker incentives to maintain mortgage payments when housing values fall. During the recent housing boom, the share of mortgage borrowing by non-occupant owners was relatively high in states where home values appreciated relatively rapidly. After the housing boom, foreclosures on non-occupant mortgages in several Midwestern and Northeastern states reflected primarily a high rate of foreclosure per mortgage, not a high volume of ...
Conference Paper
Improving evaluation and metrics in youth financial education
The Federal Reserve Bank of San Francisco, the Take Charge America Institute at the University of Arizona, and the Federal Reserve Bank of Minneapolis invited a small group of researchers and practitioners to discuss how to improve the evaluation and metrics of youth financial education programs. The meeting focused specifically on youth ? which we defined as individuals under the age of 25 ? in an effort to distinguish this effort from others that have discussed financial education research more broadly. The goal for the meeting was to help create a research agenda that would move the field ...
Report
Accounting for regional migration patterns and homeownership disparities in the Hmong-American refugee community, 1980-2000
Hmong refugees began arriving in significant numbers in the United States in the late 1970s. Compared to typical immigrants, Hmong-Americans came with few financial, labor market, or co-ethnic support factors in favor of their economic success in the United States. Focusing on homeownership as an indicator of economic assimilation, we show that indeed the overall Hmong-American homeownership rate was initially very low but had converged, by 2000, to a level typical for U.S. immigrants of equivalent time in country. Over the same period, however, wide regional gaps in Hmong-American ...
Journal Article
Credit risk data may help target foreclosure mitigation
What Ninth District areas are being especially hard hit by foreclosure?
Journal Article
As the nation's economy goes, so goes Minnesota's
Journal Article
Vector autoregression evidence on monetarism: another look at the robustness debate
This paper is a case study of the use of vector autoregression (VAR) models to test economic theories. It focuses on the work of Christopher A. Sims, who in 1980 found that relationships in economic data generated by a small VAR model were inconsistent with those implied by a simple form of monetarist theory. The paper describes the work of researchers who criticized Sims' results as not robust and Sims' response to these critics. The paper reexamines all of this work by estimating hundreds of variations of Sims' model. The paper concludes that both Sims and his critics are right: Sims' ...
Report
A case for post-purchase support programs as part of Minnesota's emerging markets homeownership initiative
The State of Minnesotas Emerging Markets Homeownership Initiative (EMHI) seeks to boost homeownership rates among Minnesotas emerging markets, defined as households of color, non-English speaking households, and households in which English is a second language. Many of the implementation strategies in the EMHI Business Plan address general barriers to homeownership and should increase the number of emerging market households that become first-time homeowners. EMHI doesnt stop there, however. It also recognizes the need to sustain homeownership after initial purchase, in keeping with growing ...