Morgan Stanley caused a stir on Tuesday when it put out a "bear case" scenario of $10. Now Citi is getting in on the act.Investingread more
Qualcomm unlawfully suppressed competition in the market for cellphone chips and used its dominant position to impose excessive licensing fees, a U.S. judged ruled.Technologyread more
Target's e-commerce sales also surged 42%, as shoppers increasingly turned to its curbside pickup service for online orders, something Amazon can't offer.Retailread more
Homeowners are taking advantage of lower interest rates, rushing to refinance their mortgages before rates potentially turn higher again.Real Estateread more
Lowe's shares plummeted 8% before the bell Wednesday after the company posted mixed fiscal first-quarter results and cut its forecast for the year, as higher costs weighed on...Retailread more
Department stores are being hung out to dry as Kohl's shares fall after earnings, but some experts still see opportunity in the space.Trading Nationread more
It may be years from visiting your neighborhood, but a walking robot is part of Ford's vision for how its autonomous vehicles will deliver packages.Technologyread more
Brazilian makeup brand Natura Cosmeticos agreed to buy Avon Products, according to two media reports early on Wednesday.Retailread more
Consumers in China are taking to social media to express their support for Huawei as the U.S. government looks to ramp up pressure on the Chinese smartphone maker.Technologyread more
Tensions between the two parties have heightened in recent months as the campaign for seats in the Brussels and Strasbourg-based parliament has crescendoed.Europe Politicsread more
St. Louis Federal Reserve President James Bullard expressed optimism that the United States and China will reach a deal to end their trade war.World Economyread more
The co-creator of the much-watched S&P/Case-Shiller home price index doesn't think the mortgage interest deduction really matters to the housing market.
"It's not big," said Yale economics professor and Nobel laureate Robert Shiller.
He also doesn't think home prices will fall if the cap on the amount of mortgage debt (currently $1 million of debt) one can deduct interest payments on is cut in half. About 2.9 million borrowers have mortgages with an outstanding balance higher than $500,000, according to Black Knight.
"The general idea is it would push prices down if people are rational," which Shiller says they are not when it comes to housing. He is the author of the bestselling book "Irrational Exuberance."
He does, however, think that if homeowners can no longer deduct their property taxes, or if the amount they can deduct is limited under the new tax plan, that would be a big deal — at least to rich people.
"That is going to be a substantial hit to people who are paying a lot of property taxes, and it might be a consideration that you make before you buy a big mansion in some high property tax state," said Shiller.
While economists, housing advocates and housing industry lobbyists argue the effects of the Republican tax plan and worry about the possibility of higher interest rates, Shiller, who has studied the economics of housing dating back to the 1800s, sees very little rhyme or reason to any of it. The human factor — the emotional aspect of most people's single largest investment, a home — is far greater than the market stimuli that are accorded such importance.
"I tend to think it's not as great as you imagine because people are people, and I don't find that historically home prices have relied at all predictably to changes in things like interest rates," said Shiller, pointing to the huge boom in housing in the last decade. Interest rates didn't move at all during that time.
That boom, instead, was fueled by a complete crater in any type of lending standard in the mortgage market. People were offered loans at almost no cost, so they took them — and never believed that home prices could fall. In the early 80's during a huge spike in interest rates to double digits, home prices fell slightly, but people kept buying homes.
"Things happen that have no explanation," said Shiller.