Some of the highest mortgage rates in 14 years are beginning to stall the once red-hot housing market. That’s bad news for buyers and sellers – including me – but to the Federal Reserve, it’s a sign of progress.
The Fed is in the midst of an unprecedented series of interest rate hikes – with the next planned for Wednesday – to fight soaring consumer prices. And the housing market is a key indicator because it’s the part of the economy most affected by changes to borrowing costs, explains Mark Flannery, a finance scholar at the University of Florida. The Fed’s goal: subdue inflation without inducing a recession.
So what does housing tell us about whether the Fed is managing to tame inflation? Flannery’s son, who has been hunting for a larger home for his family, provides a clue.
Also today:
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Bryan Keogh
Deputy Managing Editor
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Home sales are slowing as the Fed hikes rates.
AP Photo/John Raoux
Mark Flannery, University of Florida
Because housing is sensitive to changes in borrowing costs, it can tell policymakers and consumers a lot about whether the Fed’s plan is working.
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Environment + Energy
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Emma Kast, University of Cambridge; Jeremy McCormack, Goethe University Frankfurt am Main; Sora Kim, University of California, Merced
Megalodon, the world’s largest known shark species, swam the oceans long before humans existed. Its teeth are all that’s left, and they tell a story of an apex predator that vanished.
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Science + Technology
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Idan Ginsburg, Georgia State University
Astronomers have discovered the first dormant black hole outside of the Milky Way. These black holes are not absorbing matter from a nearby star, making them incredibly hard to find.
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Paul S. Rosenbloom, University of Southern California; Christian Lebiere, Carnegie Mellon University; John E. Laird, University of Michigan
To build a true artificial mind, first map out how thinking works. Enter the Common Model of Cognition.
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Gavin Naylor, University of Florida
The first hammerhead shark was likely the result of a genetic deformity. A biologist explains how shark DNA reveals hammerheads’ history.
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Health + Medicine
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William Petri, University of Virginia
The oral polio vaccine – which is no longer given in the US – relies on a live but weakened virus that can actually be passed from person to person.
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Economy + Business
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Vidhura S Tennekoon, Indiana University
An expert on Sri Lanka’s economy identifies and explains three key challenges that Ranil Wickremesinghe will have to overcome if he hopes to steer the country out of its crisis.
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Education
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Guangyi Wang, University of California, San Francisco; Rita Hamad, University of California, San Francisco
An analysis shows that Black students at more racially segregated schools have a greater tendency to turn to the bottle.
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Politics + Society
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Matthew A Baum, Harvard Kennedy School; Alauna Safarpour, Harvard Kennedy School; Kristin Lunz Trujillo, Harvard Kennedy School
Justice Samuel Alito said that abortion policy crafted by elected representatives in the states would be more responsive to what constituents want than federal protection of the right. He was wrong.
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