http://www.frbsf.org/publications/economics/letter/ Short essays on current topics by Research economists. http://www.frbsf.org/publications/economics/letter/2010/el2010-04.html Hong Kong and China are recovering impressively from global recession thanks to effective stimulus programs. But authorities worry that expansionary U.S. monetary policy may fuel asset bubbles in their economies. In the long run, the recession may nudge China toward increased domestic consumption by highlighting the risks of export-driven development. This Letter is adapted from a report by the president and CEO of the Federal Reserve Bank of San Francisco on her visit to Hong Kong and China November 15-21, 2009. Each year, the president of the San Francisco Fed joins the Federal Reserve governor responsible for liaison with Asia on a fact-finding trip to the region, in keeping with the Bank's objective of developing expertise on issues related to the Pacific Basin. FRBSF <em>Economic Letter</em> Mon, 08 Feb 2010 08:00:00 GMT http://www.frbsf.org/publications/economics/letter/2010/el2010-04.html http://www.frbsf.org/publications/economics/letter/2010/el2010-03.html In the United States throughout 2009, the share of adjustable-rate mortgages among total mortgage originations was very low, apparently reflecting the attractive pricing of fixed-rate mortgages relative to ARMs. Government policy could have changed the relative attractiveness of the fixed-rate mortgages and ARMs, thereby shifting the market share of these two housing finance instruments. FRBSF <em>Economic Letter</em> Mon, 01 Feb 2010 08:00:00 GMT http://www.frbsf.org/publications/economics/letter/2010/el2010-03.html http://www.frbsf.org/publications/economics/letter/2010/el2010-02.html Monetary policymakers have long debated the usefulness of the Phillips curve, which relates inflation to measures of economic slack. Since the recession started in late 2007, evidence suggests that, consistent with the Phillips curve, a high level of unemployment has contributed to a decline in inflation. FRBSF <em>Economic Letter</em> Tue, 19 Jan 2010 08:00:00 GMT http://www.frbsf.org/publications/economics/letter/2010/el2010-02.html http://www.frbsf.org/publications/economics/letter/2010/el2010-01.html Household leverage in the United States and many industrial countries increased dramatically in the decade prior to 2007. Countries with the largest increases in household leverage tended to experience the fastest rises in house prices over the same period. These same countries tended to experience the biggest declines in household consumption once house prices started falling. FRBSF <em>Economic Letter</em> Mon, 11 Jan 2010 08:00:00 GMT http://www.frbsf.org/publications/economics/letter/2010/el2010-01.html