Other recent research on potential growth includes De Michelis, Estevão, and Wilson (2013) and Haltmaier (2012). 18  For analysis of fiscal effects, see Congressional Budget Office (2013). BIS central bankers’ speeches  9  of state and local governments have improved, reducing the need for further sharp cuts. The aftereffects of the housing bust also appear to have waned.
For example, notwithstanding the effects of somewhat higher mortgage rates, house prices have rebounded, with one consequence being that the number of homeowners with “underwater” mortgages has dropped significantly, as have foreclosures and mortgage delinquencies. Household balance sheets have strengthened considerably, with wealth and income rising and the household debt-service burden at its lowest level in decades.