The Unassuming Economist

From the Federal Reserve Bank of New York:

“A decade after the financial crisis, the U.S. mortgage finance system remains largely untouched by legislative reforms. Policy deliberations have focused on Fannie Mae and
Freddie Mac—the two enormous government-sponsored enterprises (GSEs) that were placed into federal conservatorship in September 2008. The conservatorships were initially thought of as a temporary arrangement during which U.S. mortgage markets could be stabilized and function as intended, while providing time for Congress to consider the appropriate long-term federal role in the secondary mortgage market. To date, however, legislators have yet to resolve some basic issues: Should government guarantees continue to be available for a large swath of loans? If so, what types of institutions should have direct access to guarantees and how would their access be facilitated and regulated?

This special issue of the Federal Reserve Bank of New York’s Economic Policy Review presents a set of articles that developed from presentations given at “The Workshop on the Appropriate Government Role in U.S. Mortgage Markets,” held at the Bank on April 27-28, 2017. The workshop was organized in association with the Board of Governors, the Federal Reserve Bank of Atlanta, the Anderson School of Management at the University of California–Los Angeles, and the Wharton School of the University of Pennsylvania. We emphasize at the outset that the opinions expressed in the articles are those of the authors and do not necessarily reflect the views of any of the organizing institutions. In this introduction, we provide some context for the workshop and highlight the articles’ key findings.”

Introduction
W. Scott Frame and Joseph Tracy

GSE Guarantees, Financial Stability, and Home Equity Accumulation
Wayne Passmore and Alexander H. von Hafften

The FHA and the GSEs as Countercyclical Tools in the Mortgage Markets
Wayne Passmore and Shane M. Sherlund

Pricing Government Credit: A New Method for Determining Government Credit Risk Exposure
Brent W. Ambrose and Zhongyi Yuan

Peas in a Pod? Comparing the U.S. and Danish Mortgage Finance Systems 
Jesper Berg, Morten Bækmand Nielsen, and James Vickery

Credit Risk Transfer and De Facto GSE Reform 
David Finkelstein, Andreas Strzodka, and James Vickery

Credit Risk Transfer, Informed Markets, and Securitization
Susan M. Wachter

Housing Affordability: Recommendations for New Research to Guide Policy 
Jane Dokko

Long-Term Outcomes of FHA First-Time Homebuyers
Donghoon Lee and Joseph Tracy