Mortgage Equity Withdrawal (MEW)

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Forbes  Jul 17  Comment 
Gotta catch 'em all. Not most, mind you. All. As more and more players move into the Pokémon GO endgame, there's a question that's going to keep coming up. Our monsters are high enough to fight at gyms and our Pokédexes are filling up, but...
Cellular News  Jun 9  Comment 
Cable and Wireless Communications (CWC) has named Perley McBride as its mew Chief Financial Officer. Click here for more.
Clusterstock  Mar 10  Comment 
The following data is calculated from the Fed's Flow of Funds data (released last week) and the BEA supplement data on single family structure investment. This is an aggregate number, and is a combination of homeowners extracting equity - hence...
StreetInsider.com  Feb 24  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Management+Changes/Genetic+Technologies+%28GENE%29+Acting+CEO+Tom+Howitt+Steps+Down+as+Alison+Mew+Returns/9206245.html for the full story.
The Economic Times  Dec 18  Comment 
"Outlook on Kalindee Rail to depend on mew govt's policies."
StreetInsider.com  Dec 10  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Management+Changes/Genetic+Technologies+%28GENE%29+Names+Alison+Mew+as+CEO/7934802.html for the full story.
OilVoice  May 31  Comment 
Richard Mew CEO of Gold Oil has informed the Board of his intention to step down from his position effective immediately to pursue other business interests. John Bell NonExecutive Chairman wil
Wall Street Sector Selector  Jun 13  Comment 
Special Note: Dr. James Kennedy has a new method for calculating equity extraction: "A Simple Method for Estimating Gross Equity Extracted from Housing Wealth". I haven't evaluated his method yet (here is a companion spread sheet), so the...
Wall Street Journal  May 18  Comment 
Lenny again. Some (mostly) light reading for the train ride home: Is retirement equity withdrawal the new mortgage equity withdrawal? -- Calculated Risk The lawyer for Dominique Strauss-Kahn's accuser denies, condemns the NY Post's "HIV...
StreetInsider.com  Apr 25  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/China+Jo-Jo+Drugstores+%28CJJD%29+Appoints+Mew+Independent+Auditor/6444802.html for the full story.




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Mortgage Equity Withdrawals, also referred to as Home Equity Extraction, measures the value that homeowners are pulling out of their homes via home equity loans. Homeowners with equity in their homes - IE, whose homes are worth more than they owe in mortgages - are sometimes able to get additional loans from the bank using their equity in the home as collateral. This reduces the homeowner's equity (or ownership in the property), but increases his or her available cash. From 2000-2006, the cash homeowners removed from their homes was an increasingly important component of GDP (see chart below right). However, as housing prices began to slow their ascent, MEWs dropped precipitously in late 2007 and early 2008.

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Chart prepared by frontlinethoughts.com on using methodology originally developed by Alan Greenspan and James Kennedy at the Federal Reserve show what a critical part of GDP growth mortgage equity withdrawals were from 2000 - 2006.
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Chart prepared by Alan Greenspan and James Kennedy at the Federal Reserve in 2005 shows the dramatic increase in mortgage equity withdrawals from 2000 - 2005....
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....which then drop after 2005 with the softening real estate market (source: Jim Kennedy at the Federal Reserve, update via http://www.frontlinethoughts.com/pdf/mwo101708.pdf

Economists track mortgage equity withdrawals because the cash homeowners extract from their homes was believed to be an important driver of consumer spending and consumer confidence from 2001 - 2008.

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