1. The Bullish Outlook Continues
Dr. Mark G. Dotzour
Chief Economist
Real Estate Center at Texas A&M University

2. Household Debt Service Payments
as a Percent of Disposable Personal Income
Household Debt Service Payments as a Percent of
Disposable Personal Income
(Percent)
Source: Board of Governors of the Federal Reserve System

3. Household Net Worth Recovering
After Stock Market Rally
Households and Nonprofit Organizations; Net Worth, Level
(Billions of Dollars)
Source: Board of Governors of the Federal Reserve System

4. The Oil Market:
“Let’s Play Hardball”

5. Money Supply and Velocity:
Actual Money Supply Growing Modestly
Source: Federal Reserve Bank of St. Louis
(Percent Change from Year Ago)
MZM Money Stock

6. Too Much Money Chasing Deals

7. Too Much Money Chasing Deals
S&P 500 companies have parked $1.9 trillion of profits
they have made outside the U.S.
• There is a total of $2.6 trillion in US money market funds.
• A recent report from Bain said PE firms have more than $1
trillion in unused cash at he end of 2013.
• Goldman Sachs has raised $2.4 billion for its second real estate
debt fund. With leverage, it will be able to buy $4.2 billion in
commercial real estate loans that mature in coming months.
• Carlyle Group raised $5.5 billion in new equity capital in
1Q2014, pushing total assets under management to $198
billion.

8. Margin Debt
Debit Balances at Broker/Dealers
500000
450000
400000
350000
300000
250000
200000
150000
100000
Mar 2000 Dow 11,234
Mar 2001 Dow 9,106
Mar 2002 Dow 7,415
Jan-98
Jan-99
Jan-00
Jan-01
Jan-02
Jan-03
Jan-04
Jan-05
Jan-06
Jan-07
Jan-08
Jan-09
Jan-10
Jan-11
Jan-12
Jan-13
Jan-14
Millions
Source: Standard and Poor’s
Jul 2007 Dow 14,021
Jul 2008 Dow 10,827
Jul 2009 Dow 8,087