For those interested in NAR Chief Economist Lawrence Yun’s conversation with Christina Romer and Gregory Mankiw at the 2013 NAR Issues Conference, here is the PPT that was used.

1. Economists’ Panel
Christina Romer vs. Greg Mankiw
Moderated by Lawrence Yun
NAR 2013 Issues Conference
Dana Point, CA
February 15, 2013

2. 70
75
80
85
95
100
105
110
90
115
2007 - Jan
2007 - Apr
2007 - Jul
2007 - Oct
2008 - Jan
2008 - Apr
2008 - Jul
2008 - Oct
2009 - Jan
2009 - Apr
2009 - Jul
2009 - Oct
2010 - Jan
2010 - Apr
2010 - Jul
2010 - Oct
2011 - Jan
2011 - Apr
2011 - July
Homebuyer Tax Credit
2011 - Oct
2012 - Jan
2012-Apr
2012 - Jul
2012 - Oct
Pending Home Sales Index
Was the home buyer tax credit a success in stopping bleeding in housing?

3. 100
120
160
180
200
220
140
2000 - Jan
2000 - Jul
2001 - Jan
2001 - Jul
2002 - Jan
2002 - Jul
2003 - Jan
2003 - Jul
2004 - Jan
2004 - Jul
2005 - Jan
2005 - Jul
2006 - Jan
2006 - Jul
2007 - Jan
2007 - Jul
2008 - Jan
2008 - Jul
2009 - Jan
Home Price Index
2009 - Jul
2010 - Jan
Tax Credit
2010 - Jul
Homebuyer
2011 - Jan
Home prices essentially stabilized after the tax credit after steep declines.
2011 - Jul
2012 - Jan
2012 - Jul

4. THE BABY BOOM, THE BABY BUST,
AND THE HOUSING MARKET
N. Gregory Mankiw and David N. Weil
Harvard University
• Written in 1988
• “ … real housing prices will fall
substantially over the next two decades.”
• “ … because the Baby Bust generation is
now entering its house-buying
years, housing demand will grow more
slowly in the 1990s than in any time in the
past forty years.”
Will Baby Bust impact will be mitigated from population growth and immigration?

5. The Greatest Generation!
From Poverty to Victory to Prosperity
Baby Boomer parents were the ‘Greatest’ and what role did the government play or not?

6. Soviet Joke
Pretend the ‘train is moving’ … led to complacency and eventual collapse

7. The Lost Generation ! (?)
Is America pretending we don’t have problems on entitlement obligations?

8. Federal Government
Tax Revenue and Spending
Revenue Spending
4000000
12-month tally in $ million
3500000
3000000
2500000
2000000
1500000
1000000
500000
0
1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
- Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan - Jan
Should deductions be limited to raise revenue or should spending be cut?

9. The Role of Government
• Reagan … Wanted Small Government
– How? Run up big deficits …. this is the only way
for people to understand the need to restrain
spending
• Obama … Wants Big Government
– How? Run up big deficits … this is the only way for
people understand the need to pay higher taxes

10. 25,000
27,000
29,000
31,000
33,000
35,000
37,000
39,000
41,000
1980 - Q1
1981 - Q1
1982 - Q1
1983 - Q1
1984 - Q1
In thousands
1985 - Q1
1986 - Q1
1987 - Q1
1988 - Q1
1989 - Q1
1990 - Q1
1991 - Q1
1992 - Q1
1993 - Q1
1994 - Q1
1995 - Q1
1996 - Q1
1997 - Q1
1998 - Q1
1999 - Q1
2000 - Q1
2001 - Q1
2002 - Q1
Are we headed towards a Renter Nation?
Renter Households
2003 - Q1
2004 - Q1
2005 - Q1
2006 - Q1
2007 - Q1
2008 - Q1
2009 - Q1
2010 - Q1
2011 - Q1
2012 - Q1

11. 50,000
55,000
60,000
65,000
70,000
75,000
80,000
1980 - Q1
1981 - Q1
1982 - Q1
1983 - Q1
1984 - Q1
In thousands
1985 - Q1
1986 - Q1
1987 - Q1
1988 - Q1
1989 - Q1
1990 - Q1
1991 - Q1
1992 - Q1
1993 - Q1
1994 - Q1
1995 - Q1
1996 - Q1
1997 - Q1
1998 - Q1
1999 - Q1
2000 - Q1
2001 - Q1
2002 - Q1
2003 - Q1
2004 - Q1
2005 - Q1
Homeowner Households
2006 - Q1
2007 - Q1
2008 - Q1
2009 - Q1
2010 - Q1
2011 - Q1
2012 - Q1

12. Wealth Distribution
(Federal Reserve data on median net worth)
$300,000
Bubble Crash
$250,000
$200,000 1998
2001
$150,000
2004
$100,000 2007
2010
$50,000
2014
$0 2014 Forecast by NAR
Renter Owner
Is Lawrence Summers right that hedge funds becoming owners while good renters are
having great difficulty obtaining mortgages?

13. Bully or Smartest Person in the World?
Really, he’s a …

14. Monetary Policy by Federal Reserve
(zero rate policy to 2015 ?)
% Fed Funds
6
5
4
3
2
1
0
Will loose monetary policy lead to future inflation?

15. Federal Reserve Balance Sheet from
Quantitative Easing
Total Assets
3500000
$ million
3000000
2500000
2000000
1500000
1000000
500000
0
1-Aug-07 1-Aug-08 1-Aug-09 1-Aug-10 1-Aug-11 1-Aug-12
Will the Fed report losses in the future when interest rates rise?

16. 1
2
4
5
0
3
-1
2000 - Jan
2000 - Jul
2001 - Jan
2001 - Jul
2002 - Jan
2002 - Jul
2003 - Jan
2003 - Jul
2004 - Jan
2004 - Jul
2005 - Jan
2005 - Jul
2006 - Jan
2006 - Jul
Owners' Equivalent Rent
2007 - Jan
2007 - Jul
2008 - Jan
2008 - Jul
2009 - Jan
2009 - Jul
2010 - Jan
2010 - Jul
(the biggest weight to Consumer Price Index)
Renters' Rent
2011 - Jan
2011 - Jul
2012 - Jan
3.8% tax on rental income … higher future rent?
2012 - Jul
Rising Renters’ and Homeowners’ Rent Growth
Nearing 3%

17. Nation’s Mobility Rate
From 18% to 12%
Fraction of Population Who Moved in the Last 12 Months
(Any Distance)
.2
.18
.16
.14
.12
.1
1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Year
Falling mobility naturally implies less movement up the economic ladder.
What should and shouldn’t be done to reverse the trend?

18. Person of the Century?
In regards to impacting the economic well-
being, should Deng Xia-Ping be considered
as someone who lifted the most people
out of poverty (by abandoning Mao policy
and implementing wealth creation
policies) and hence the person of the
century?

19. Will China overtake the U.S. in GDP?
It depends on Singapore
U.S. (growing 3%) China (growing 8%)
25000
20000
15000
10000
5000
0
1937
1929
1933
1941
1945
1949
1953
1957
1961
1965
1969
1973
1977
1981
1985
1989
1993
1997
2001
2005
2009
2013
2017
2021
2025

20. Persons of the Millennia?
The Glorious Revolution of William and Mary definitively affirmed the
power of the parliament and the rule of law (and not the arbitrary
powers of Kings and Queens), which thereby guaranteed that the
English-speaking people would rise to the top in economic
development.