Editor's Note: This is a monthly publication on economic trends and financial policy issues. In this publication you can read "The Longbrake Letter", an analysis of economic trends and conditions written by Bill Longbrake, as well as commentary on financial regulation and policy written by members of the law firm Barnett, Sivon & Natter, P.C., a Washington, DC based law firm that specializes in financial services law.

ISSUE: #41, September 2013

The Longbrake Letter
- Bill Longbrake
In this month's letter Bill Longbrake examines why monetary policy, as currently structured, may lead to lower potential structural real GDP growth. He also updates his previous analysis of productivity to incorporate the effects of recent GDP data revisions. Both sets of analyses point in the direction of slower than expected growth in real GDP in the future. The letter also includes updates for consumer income, spending, employment, monetary policy and fiscal policy.

Agencies' QRM Proposal is a Step Forward
- Bob Barnett
Mortgage lending has increased, but not as fast as many would like. There are reasons for that. Here are 10.

The Debt-to-Income Standard in the QM Regulation
- Ray Natter
Most lenders have focused on the 43 percent debt-to-income standard in the CFPB's QM rule which goes into effect in January 2014. However, a review of the regulation shows that there is a second DTI standard that is not subject to the 43 percent bright line and which appears to include obligations (such as alimony) not included in the first DTI standard. Failure to comply with this second DTI test could result in loss of QM status for mortgages that otherwise comply with all of the requirements for a QM loan.

I Hereby Affirm and Ratify
- Jim Sivon
Recently CFPB Director Cordray formally “ratified” the actions he took while serving as a recess appointee. However, as Jim Sivon explains, this ratification may not be binding, and the outcome of the Supreme Court case Noel Canning still will have an impact on the CFPB.