Economic changes influence markets

By Dr. Randall J. Pozdena Senior Economist Federal Reserve Bank of San Francisco

IIHE market

I for housing in 1985 is unlikely to be either extraordinarily weak or extraordinarily strong. However,whether the market will be tending toward recovery or further recession is dependent critically on the unfolding of a number of events outside the housing industry itself.

The general status of the economy in 1985, of course, will play a major role in determining the health of the housing industry.

It is this author's view that the extraordinarily rapid growth in the general economy experienced in 1984 will not be repeated in 1985. With slower growth will come moderation and aggregate demand for goods and services in the economy generally,

Story at a Glance

Economy, balanced budget, taxes, trade deficit influence housing prospects. .lssues will affect 1985, set tone for luture.