Resilience Through it All
October 4, 2023
There’s a lot happening in the United States right now, and in this issue of Above the Line, we give you the top three most important stories in Real Estate, Investing, and Taxation.
In Bloomberg, Richmond Fed President Tom Barkin shares insights on the surprising resilience of the American economy amid rising interest rates. The WSJ examines a 41% drop in new apartment construction, and taxfoundation.org details the potential resurgence of worldwide combined reporting in select states, sparking discussions about its complexities and the potential for double taxation.
Richmond Fed President Tom Barkin Explores U.S. Economy's Resilience to Higher Interest Rates and Implications for Multiple Sectors
Bloomberg
Richmond Fed President Tom Barkin explores the surprising resilience of the U.S. economy to increased interest rates and its repercussions on multiple sectors, drawing from insights gleaned from his dialogues with regional businesses. Barkin voiced apprehensions regarding the enduring nature of inflation, underscored economic risks, and delved into the potential effects of elevated rates on the housing market. He acknowledged that while affordability might be impacted, history has shown the housing market's ability to withstand rate hikes in the past.
US Apartment Construction Sees 41% Drop in Starts Amid Rising Rates and Overbuilding Concerns
Wall Street Journal
Construction of new apartments in the United States has significantly declined, with a 41% drop in apartment building starts in August compared to the same month the previous year, due to factors like higher interest rates, declining rents, and concerns about overbuilding, leading to an expected two-year period of reduced construction, as banks tighten lending standards and construction financing costs rise, causing builders to hit pause on new projects.
A Tax Concept from the '80s Resurfaces: Worldwide Combined Reporting
Taxfoundation.org
Mandatory worldwide combined reporting, a tax idea from the 1980s, is resurfacing in some states, with lawmakers in Minnesota and New Hampshire considering its implementation; however, this approach raises concerns about the complexity of taxing multinational corporations' global activity, compliance costs, and double taxation issues.
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