, while avoiding the mistakes of the recent past? achieving credit quality and availability some would argue that most of the really risky behavior is now out of the market. but, unfortunately, the backlash has restricted a lot of perfectly responsible lending as well. banks are reluctant to put any but the lowest possible risk loans in their portfolios. and the market for new private mortgage loan securitizations is essentially closed. thus, borrowers face tight underwriting requirements, even if their own risk profile looks relatively “ safe ” by historical standards. moreover, even homebuyers with the requisite down payment realize that their home equity is much less liquid than in the past. once, borrowers could count on cash - out refinancing or home equity lines of credit as a means of cheaply accessing their home equity ; robert b. avery, neil bhutta, kenneth p. brevoort, glenn b. canner, and christa n. gibbs, “ the 2008 hmda data : the mortgage market during a turbulent year, ” ( draft ). article forthcoming in the federal reserve bulletin. in 2008, the reported hmda share of fha - insured home loans was 21. 5 percent. the percentage of hmda reported fha loans had not reached nearly 20 percent since 1990 ( 18. 1 ). national association of realtors profile of homebuyers and sellers. the national association of realtors, “ 2009 housing opportunity pulse survey. ” the nar annual telephone survey of 1000 adults shows “ … eight in 10 ( borrowers ) still consider having enough money for downpayment and closing costs to be the biggest obstacle to buying a home. ” these avenues are now much more restricted. a risk - averse renter might prefer to keep his assets readily available rather than lock them up in a house. on balance, even taking into account the excesses of the bubble period, it appears that lenders have now tightened underwriting terms so much that the lack of credit availability is at least partially an impediment to homeownership. as we work to correct the problems of the recent past, we must keep in mind the importance of access to credit. if anything, the recent mortgage meltdown and sharp pullback in lending only demonstrates how critical it is for the economy to have a well - functioning housing finance market. with the old mortgage system in disarray, we are, one hopes, within sight of

term inflation forecasts have had to be radically altered as evidence of higher inflation has accumulated. and yet the settings of uk monetary policy have not changed at all in the light of this experience of much stronger inflation. the view that spare capacity and weak demand will bear down on inflation in the future still underpins the majority view on the mpc, despite the evidence that this is not what has happened over the recession and the early phases of the recovery. chart 3 changing inflation outlook for 2011 bank of england mean forecasts for cpi inflation in q1 2011 4. 5 4. 0 3. 5 3. 0 2. 5 2. 0 1. 5 1. 0 0. 5 0. 0 feb - 09 may - 09 aug - 09 nov - 09 feb - 10 may - 10 aug - 10 nov - 10 feb - 11 outturn source : ons and bank of england in my time on the monetary policy committee i have earned myself a reputation as a “ hawk ” or even an “ uber - hawk ” because of my stance on interest rates. this reputation has been reinforced by my consistent minority votes since june last year to raise the uk bank rate. but i acquired my hawkish mantle much earlier, in my first year on the mpc, when i voted in according to monitoring by tmf, an international tax consultancy, eight other european countries raised vat rates at the beginning of 2011, including switzerland, from 7. 6 % to 8 % ; portugal, from 21 % to 23 % ; poland, from 22 % to 23 % and slovakia, from 19 % to 20 %. spain and portugal also raised rates last year, along with finland. in addition, the ons estimate that uk cpi rose by 0. 76 % in january 2011 in response to the rise in vat, whereas the difference between uk and euro area inflation in that month was 1. 7 %, and the gap with swedish and swiss inflation was 1. 9 % and 3. 7 % respectively. bis central bankers ’ speeches a minority on a number of occasions to raise interest rates in response to the relatively strong growth and rising inflation we were experiencing before the financial crisis. those minority votes, however, were the expression of modest differences in the timing of interest rate changes. the mpc was tightening policy over that period – from the summer of 2006 to the summer of 2007 – and i was in support of the broad strategy of gradual tightening that was being pursued. and i continued to support the broad