The Latest
March 2008
www.Bankrate.com update:
Maybe the sixth time will be the charm. Then again, it might ultimately create more issues than it resolves. The Federal Reserve will most certainly cut interest rates for a sixth time at today's meeting in an effort to erase payment increases on adjustable-rate mortgages, cushion the economic blow of a recession and vanquish the credit crunch.
A sixth interest rate cut, much as with the previous five, will be received with open arms by those with resetting ARMs. Homeowners with adjustable-rate mortgages facing a reset in the coming months have the Fed to thank for an adjustment that will be much ado about nothing, or can in some cases even cause the payments to decline. Talk about a mulligan. Millions of homeowners will get a yearlong reprieve from a painful payment adjustment thanks to the repeated Federal Reserve moves, something that will be far more significant to far more people than any foreclosure relief plan or coalition of government and lenders.
The full effects of Federal Reserve rate cuts are felt with a lag, and the sixth rate cut will, just as with moves four and five during January, represent significant juice to economic growth in the fourth quarter of 2008 and for 2009.
But the Fed rate cuts have proven completely ineffective at warding off the credit crunch, and at best have kept it from being worse. That is little consolation with the credit markets in intensive care, carrying a disease that can infect the entire economy.
What repeated Fed rate cuts may prove very effective at is inciting inflation. The February Consumer Price Index was flat versus the month prior, which may validate to some the Fed's long-held stance that inflation pressures would ultimately moderate. So let me ask, does it feel like inflation was flat in February? Not from where I'm standing. In fact, let's revisit just a few statistics. As I write this, oil is over $110 per barrel, the dollar is at yet another low against the euro ($1.56), gold is over $1,000 an ounce, and in the past 12 months the headline and core CPI are up 4 percent and 2.3 percent, respectively. If anyone truly believes that inflation is a non-issue, there is a bridge I want to sell you. If the headline CPI were to get back to a year-over-year rate of 2.5 percent -- what I would call a level where inflation is a non-issue -- the CPI would need to remain flat for the next four months!
Sooner or later, the Federal Reserve will have to contend with inflation. That is better done with some restraint on further rate cuts now, rather than with the painful fallout later once the inflation genie is completely out of the bottle.
March 2008
Your government leaders have once again ignored the Arizona Market. We all expected the conforming loan amount to be raised to at least $517,000 from its current $417,000. Instead, they raised ONLY the Flagstaff area to $450,000 and ignored the rest of Arizona. BUT....of course....the vast majority of California got an enormous boost to $729,000. VERY VERY disappointing and I am glad that your government can throw out a HUGE helping hand to those morons in California that pay too much for homes for the past 25 years. SAD!!!!!
January 2008
Game over. The government, Fannie Mae and Freddie Mac have given the final blow and destroyed the housing market in Phoenix. Several years ago, lenders and unprofessionals working for lenders took advantage and shoved home buyers and refinancers into horrific loans. People like "The Arizona Mortgage Coach" (as seen constantly on channel 12) who is not even licensed in the State of Arizona solicited his 1% Deferred Interest Deals. Now the backlash has begun with foreclosures and folks unable to sell OR refi.
THIS HAS NOTHING TO DO WITH THE "SUBPRIME" MARKET.
It is seen in ALL markets from million dollar homes down to less than 6 figures.
I ran a seminar on this exact problem in June of 2006. Do you know how many people attended? ZERO! People told me I was wrong, paranoid and jealous of other lender's programs. It was actually because people make bad decisions and believe the wrong people.
The "good guy" losses again.
Thank you for your patronage.
Oct 2007
The data this morning, which reported a decline in factory orders and an
increase in jobless claims, was not enough to move the markets. Bonds
remain flat and the equity markets are slightly higher. The real news
remains behind the scenes, even as many Fed officials and market
participants express the feeling that markets are returning to a state
of normalcy. Spreads remain excessive on many money market products,
with some trading near levels only seen during financial crises. So,
even as Dorothy found out, you do need to pay attention to the man
behind the curtain, as all is not well in the land of OZ. The jobs data
tomorrow morning will give us strong clues to what the near future
holds.
Sep 25 2007
Sorry, no good news today, as the National
Association of Realtors reported sales of previously owned U.S. homes
fell 4.3% to a five year low. The supply of homes for sale at the end of
the month rose to 4.58 million, the most ever, and at the current sales
pace represents a 10 months supply. It came as no surprise then, that
the Conference Board reported its index of consumer confidence dropped
to 99.8 from 105.6 in August, as workers stated they were less
optimistic about job prospects. The bond market had already improved
this morning in anticipation of the weak data, and is currently hanging
on to a slight improvement. Tomorrow we will get Durable Goods orders
for August and the Treasury has a 2 year note auction scheduled.
Sep 11 2007
Yesterday there were conflicting signs from Fed
officials with some signaling concern about consumer spending and
confidence while others remain generally encouraged about the economy,
as stated by Dallas Fed President Fisher. The current situation may best
be summed up by the Philadelphia Fed President Plosser's remarks over
the weekend as he noted that there are a lot of conflicting data.
Clearly, the market is way out ahead of the Fed with Fed Funds futures
priced at 4.81% in October and 4.37% in January. This morning bond
prices are lower as stocks rally. Two key items to note regarding bonds
are that key resistance on the 10 year note at 4.32% held yesterday, and
the put to call ratio on the Chicago Board of Trade was at 15 to 1 this
morning, a strong signal of an overbought condition.
September 7, 2007
The Labor Department delivered a shock to the markets this morning, reporting that 4,000 jobs were lost in the U.S. economy in the month of August. While some of the decrease can be attributed to seasonal adjustments, this is a clear sign the problems in the housing and credit markets are having a more significant impact on the economy than most officials have been willing to admit. Prior to this data, many were thinking the Fed would not lower its target rate at the September 18 meeting. However, given the amount of liquidity the European Central Bank and the Fed have been providing to the credit markets in the past few days, and given the weakness of the employment data, it is clear the Fed will continue to provide monetary support and the government will probably get involved and provide some sort of fiscal stimulus. I would vote for Congress releasing funds from the Highway Trust Fund to begin the much needed rehabilitation of the U.S. infrastructure. What of the bond market you ask? The yield on the 10 year note has fallen to 4.39% as investors sell stocks and seek the temporary safety of U.S. treasuries.
We are the experts and "they" have to compete with us!
We are not one of these lender's under investigation....
|
No need for tricks or bait-n-switch on our AZ mortgage.
Find out the ins & outs of mortgage
loans...start by clicking here
Contact Information
Mortgage Central, Inc. is currently licensed in the State of Arizona, MB #0905679. Mortgage Central, Inc. is allowed to originate mortgage loans in Arizona....ONLY. Other States may or may not have specific rules for Mortgage Lending.
Mortgage Central, Inc is an Equal Opportunity Lender
- Telephone
- 623-780-0086
- FAX
- 623-780-0052
- Electronic Mail
- General Information helpdesk@azmortgagecentral.com
- Postal address