Here’s one that came my way earlier today although the report was from January: New York Fed Chief Dudley has an Idea — Homeowners Should Tap Into Equity.

New York Fed President William Dudley on Tuesday encouraged homeowners to find “prudent” ways to tap into the equity that has built up in the homes, saying the boost in consumption would be a welcome shot-in-the-arm to the economy.

The shape of household finances was a hidden strength of the economy, he said.

“The good news is that, while the current expansion is quite old in chronological terms, it is still relatively young in terms of the health of household finances,” Dudley said in a speech to the National Retail Federation.

“Whatever the timing, a return to a reasonable pattern of home equity extraction would be a positive development for retailers, and would provide a boost to economic growth,” Dudley said.

Homeowners may have overlearned the lessons from the housing boom and bust, the New York Fed president said.

Even though home values have risen over 40% since 2012, housing debt has stayed virtually flat, he said.

Houses are ATMs Again 

For the first time since the recession, U.S. homeowners are beginning to withdraw some of their home equity to spend. Home-equity withdrawals were a major impetus to consumer spending before the recession.

Dudley wants more of that behavior.

The previous behavior of using housing debt to finance other kinds of consumption seems to have completely disappeared,” and people are leaving the wealth generated by rising home prices “locked up” in their homes, said Dudley.

Is Dudley evil, or is he simply stupid?

Mike “Mish” Shedlock