How Many Rooms Is Too Many?: Per-Capita Demand and the Hotel Cycle

Adam R. Lair | September 4, 2019

By Adam Lair In a recent New York Times op-ed titled Why Rate Cuts Don’t Help Much Anymore[1], Austan Goolsbee, former economic advisor to President Obama, cited a study on the effect of Federal Reserve rate cuts on demand for mortgages, stating: Fundamentally, there wasn’t much pent-up demand for investment after years of low rates, accelerated depreciation, ‘temporary’ investment expensing, and other stimulus. The lack of pent up demand also means that cutting interest rates now is unlikely to entice businesses to invest much more. In other words, to summarize Goolsbee’s general point, rate cuts don’t unleash the same i...