Last week had a less than stellar finish, which continued this morning as rates opened up almost a half point worse. Luckily through out this morning the trend has been bucked and things have bounced back slightly. The question is, temporarily or for at least a little while longer.
According to Sigma Research's Market Snapshot, unless that mystical double dip recession rears its ugly head again or inflation turns around, the day's of low interest rates are coming to an end. Time will tell, but if an investor who has been waiting for the absolute bottom, you might have missed it about a week ago and probably should hop on the departing train before you're in the "should-of, would-of" line waiting for the next train. You know the one that will be back in 3.99%ville in, I don't know . . . twenty years.
In wordily news President Obama and the fed's QE II policy was met in Asia with about as much hospitality as my Labrador showed the raccoon who climbed under the fence on Saturday. Obama is claiming he didn't get hit the home run but a "bunch of important singles, instead."
Well, this week sees a host of important activity, including the arrival of our new congress. First up, the Bush-Era tax cuts. Republicans don't have enough power to hit the long ball and even if they could muster-up an Edgar Renteria swing for the ages, the giant green wall that is President Obama's veto desk would consume even the mightiest of efforts. Look for the republicans to hit a solid single, at best, leg-out a slide in double.
Monday, November 15, 2010
Wednesday, November 10, 2010
QE II. So far, so . . .
As reported yesterday, Sacramento was one of the leading areas in job loss last month (you know leading in one of those races you'd rather finish last in), and the unfortunate position allowed the capital city to buck the more pleasant nationwide trend of a decreasing job loss rate. Today nationwide numbers were released and jobless claims fell 24,000 to 435,000 putting the total below the magical number of 450,000. Unfortunately, most people don't feel jobless rates are improving anytime soon, and are welcoming the drop below the once-magical 450,000 with more of a Kazoo-like-celebration than the full brass-band-blowout we were all searching for.
10 year notes continue to subtly climb, questioning the effectiveness of QEII. Critics of the move, like Douglas Hotlz-Eakin, president of the American Action Forum and former director of the Congressional Budget Office think the move was too early and will not have the "greasing the wheel" effect the increased liquidity was intended for. Guess it was more of a broken wheel bearing than a rusty fitting.
Rates took a 1/2 point hit yesterday afternoon in a widely anticipated short term spike. A mild fall back occurred over night.
Nationwide the refinance percentage for overall mortgage related activity rose .4% to 81.7% (imagine what it would be if more people had enough equity in their homes to qualify?).
10 year notes continue to subtly climb, questioning the effectiveness of QEII. Critics of the move, like Douglas Hotlz-Eakin, president of the American Action Forum and former director of the Congressional Budget Office think the move was too early and will not have the "greasing the wheel" effect the increased liquidity was intended for. Guess it was more of a broken wheel bearing than a rusty fitting.
Rates took a 1/2 point hit yesterday afternoon in a widely anticipated short term spike. A mild fall back occurred over night.
Nationwide the refinance percentage for overall mortgage related activity rose .4% to 81.7% (imagine what it would be if more people had enough equity in their homes to qualify?).
Tuesday, November 9, 2010
Public Sector job loss sends Sacramento towards the top (really the bottom).
What's going on in Sacramento?
Ron Trujillo and the SBJ (Sacramento Business Journal) broke the unwanted news that according to Bureau of Labor statistics, Sacramento had fallen into the unwanted position of the forth worst job loss rate in the country. It's widely believed Sacramento's unfavorable position is largely due to the erosion of the public sector which finally started its sprint after lagging well behind the private sector decline.
What's going on Nationally?
NAR sent out their rally cry earlier this week at their New Orleans conference to urge the lending industry to loosen up restrictions on "qualified" buyers to help grease the wheel. A similar plea was made to FICO Corp and private lenders to change the credit rules and help improve lending to otherwise qualified borrowers. It's a reasonable plea, but according to many experts, one that looks to fall on deaf ears in the immediate future.
Lawsuits against improper bank foreclosures continue to mount with JP Morgan, PNC Financial and Ally Financial disclosing additional suits today. Some banks including JP Morgan have resumed their foreclosure proceedings after their self-imposed moratorium. But the word at the public pool is, the pool police screwed up and maybe we don't have to get out after all. The bank stallings has allowed would be foreclosed homeowners to stand around with one foot in the water, blocking the way for new swimmers to jump in and get wet. Hey, who can blame them everybody wants to stay a little longer at the pool.
The Fed began its purchasing spree of 10 year bonds, so now let's wait and see.
How do they mix?
It's uncertain how the market will react to QEII and the Fed's bond buying spree, but most continue to believe credit restrictions not rates are the Wade Phillips hindering back the economic explosion we're all waiting for.
Ultimately QE II will inject more capital into the system, but it is unclear whether credit and lending requirements will loosen. Refinance if you can, and look for continued opportunities in the frustrating short sale market. Like your unwanted neighbor, it's not going anywhere soon.
http://www.californiacap.com/
Ron Trujillo and the SBJ (Sacramento Business Journal) broke the unwanted news that according to Bureau of Labor statistics, Sacramento had fallen into the unwanted position of the forth worst job loss rate in the country. It's widely believed Sacramento's unfavorable position is largely due to the erosion of the public sector which finally started its sprint after lagging well behind the private sector decline.
What's going on Nationally?
NAR sent out their rally cry earlier this week at their New Orleans conference to urge the lending industry to loosen up restrictions on "qualified" buyers to help grease the wheel. A similar plea was made to FICO Corp and private lenders to change the credit rules and help improve lending to otherwise qualified borrowers. It's a reasonable plea, but according to many experts, one that looks to fall on deaf ears in the immediate future.
Lawsuits against improper bank foreclosures continue to mount with JP Morgan, PNC Financial and Ally Financial disclosing additional suits today. Some banks including JP Morgan have resumed their foreclosure proceedings after their self-imposed moratorium. But the word at the public pool is, the pool police screwed up and maybe we don't have to get out after all. The bank stallings has allowed would be foreclosed homeowners to stand around with one foot in the water, blocking the way for new swimmers to jump in and get wet. Hey, who can blame them everybody wants to stay a little longer at the pool.
The Fed began its purchasing spree of 10 year bonds, so now let's wait and see.
How do they mix?
It's uncertain how the market will react to QEII and the Fed's bond buying spree, but most continue to believe credit restrictions not rates are the Wade Phillips hindering back the economic explosion we're all waiting for.
Ultimately QE II will inject more capital into the system, but it is unclear whether credit and lending requirements will loosen. Refinance if you can, and look for continued opportunities in the frustrating short sale market. Like your unwanted neighbor, it's not going anywhere soon.
http://www.californiacap.com/
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