In some cases, borrowers cannot obtain private mortgage insurance required by the GSEs. Thus, the weakened finances of private mortgage insurers could be damping mortgage credit availability for some potential borrowers. In other cases, lenders may be concerned about high servicing costs if mortgages become delinquent.
Or does it mean there’s been a downward revision about future prospects for the world economy, where if we didn’t respond to that downbeat assessment by demonstrating our willingness, our imperative, to move policy rates in the right direction? I think that’s part of the intellectual debate.