Long Beach California Real Estate Loans

Long Beach, Ca.   There is no news today, aside from Construction Spending. Tomorrow we have the Commerce Department's November Factory Orders data. This data gives us a fairly important measurement of manufacturing sector strength, both in durable and non-durable goods, and is expected down 2.6%. Also Tuesday will be the release of the minutes from the last FOMC meeting. This will give market participants insight to the Fed's thinking and concerns regarding inflation and monetary policy. The usual Jobless Claims on Thursday, and then the final report of the week comes Friday morning when the Labor Department will post December's employment figures. Current forecasts call for a 0.3% increase in the unemployment rate up to 7.0%, and Nonfarm Payroll -500,000.

Not much happened to the economy in the last 4-5 days, aside from dire numbers coming from retailers which ordinarily would help rates. Yet we find the 10-yr Treasury hit 2.50%! It has come back down slightly from there, but keep in mind that a) The market was overbought, suggesting that a correction was due, b) we have supply ahead with a 3-yr and 10-yr auction this week on Wednesday and Thursday, and a 10-yr TIPS auction tomorrow, c) how much lower did anyone think that rates were going to go, in the near term? Fortunately mortgage rates and doing better than Treasuries, which makes some sense given that they did not participate in the big move down. Currently the 10-yr is at 2.43%, and mortgage prices are perhaps .5 better in price than late last week until the last 30 minutes where are pricing has faded to no improvement.   Our window of the FED buying mortgages seems to be lifted as pricing quickly has faded in the last 30 minutes. 

According to Democratic aides, President-elect Obama's $775B economic stimulus plan will include more than $300B in tax cuts. The proposal appears to have the support of both parties. The dollar rose on speculation that the plan will help the economy recover from recession. Right now the futures market is pricing in an 82% chance that the Fed keeps rates somewhere between 0 and .25% until at least April 29^th, 2009.

The Federal Reserve Bank of New York said Monday it has begun purchasing mortgage-backed securities in an effort to bolster the battered housing market. The program, initially announced Nov. 25, allows the Fed to spend $500 billion to buy mortgage-backed securities guaranteed by mortgage giants Fannie Mae and Freddie Mac and another $100 billion to directly purchase mortgages held by Fannie, Freddie and the Federal Home Loan Banks. The program is aimed at driving down the price of mortgages and making home loans more available.  When the government comes into our market, we see improvement in pricing and as quickly as it does, it begins to fade.  As I said last week, I believe rates will relax somewhat further but is driven by the only buyer we have, the Federal Government for mortgage backed securities.

To apply for a mortgage, contact Kirk Mulhearn at 866-961-8042 ext.110

email:  kirkmulhearn@gmail.com