Given that we are at the best levels in a month, your timing couldn’t be better in front of such a high profile release. We’ll preview the Employment Report early this afternoon.
Last week's big rush of housing news began on Monday with Existing Home Sales for September UP 10% from the month before. The annual rate hit 4.53 million. This was the second straight monthly gain after July's record low following the expiration of the tax credits. The national median price for existing homes is now at $171,700, down 2.4% from a year ago. Unsold inventory dropped 1.9% from the prior month to a 10.7 months' supply.
Yesterday, post-release we saw a quick spike in our market (rally) and then the market backed off. FOMC made the statement to reinvest payments from MBS/Treasury into Treasury purchases, continuing to accommodate low interest rates.
Without the consumer back in the game, a double dip recession, led by housing is a real possibility. Politicians and the populous movement are angry about continuing anything associated with growing the government and adding to the deficit.
Treasury Secretary Geithner is medium rare as the House Oversight Committee is grilling him on AIG. Undisclosed documents, backroom deals, maybe a cover up coordinated with Sir Bernanke, and the counter parties all paid off at par (by the taxpayers) are the hot topics.
The market was looking for a better number, given high hopes of a better holiday season. We see the negative December reading as unsettling, reflecting a consumer that has started to spend but at a snail’s pace.
While a number of Fed Governors are pounding the rate rising drum, the policy statement continues to favor low rate, easy money well into 2010. What they would like to do is communicate an upcoming transition period. One that would produce a soft landing instead of going cold turkey. With their focus on employment and inflation, it would seem that rates will remain low until the unemployment picture stabilizes and then starts to improve.
Once again, it’s time for the “Mother” of all economic [...]
With Austin mortgage rates possibly improving, this is a good time for borrowers to get off the fence. Not that we’re bearish, just cautious of a market going into the Employment report at such lofty, overbought levels.
Stocks have gotten off on the wrong foot, starting in [...]
