Jan

31

  In This Issue  

 

     
  Last Week in Review:The Fed met and a Gross Domestic Product was reported.Forecast for the Week:A busy week is ahead, with important news on inflation, manufacturing, and the job market.

 

View: Ever wondered what the world was really like when you were born? Theres a fun way to find out.

 

 
     

 

  Last Week in Review  

 

     
  If at first you don’t succeed, try, try again. Last week, that popular idiom could have applied to the Gross Domestic Product (GDP) Report. Read on to learn why…and how all the week’s news impacted Bonds and home loan rates. The Advanced GDP reading – or first of three readings – for the 4th Quarter of 2011 came in at 2.8%, a bit below expectations of 3.2%. This number will be revised two more times, but if the final GDP remains at 2.8%…then the overall GDP for 2011 would be a scanty 1.57%. That is certainly a “Gross” Domestic Product, when you consider that the government has underwritten more than half of that economic growth with the Payroll Tax benefit. 

 

Also in the news last week, the Fed’s Policy Statement after its regularly scheduled Federal Open Market Committee meeting was pretty much the same story as recent Statements, including stable long-term inflation expectations, a tepid economic recovery, and fragile job market. But there was one big exception to their norm. The Policy Statement said there will be “exceptionally low levels for the Federal Funds Rate at least through late 2014.” This is a huge change from the previous statements of “low rates until mid-2013.”

 

On the surface, extending the zero interest policy until 2015 tells us the Fed thinks the economy will just be slogging along, and accommodative monetary policy will be required to keep the economy growing at least at a modest pace. One could argue that recent economic data is better of late and that all this loose monetary policy is unnecessary. But the Fed has spoken, and as the old adage goes: “Don’t fight the Fed.”

 

In news out of Europe, yields in European Bonds have come downand by quite a bit. This sparked some optimism that Europe’s Long-term Refinance Operation (LTRO) has helped alleviate some pressure in the peripheral countries in the Eurozone, like Spain and Italy. So what’s the takeaway? In honor of the upcoming Super Bowl, here’s a football analogy: think of the LTRO as a super punt or “kick of the can” down the road. Europe needs to play a serious offensive line by creating a tighter fiscal union, implementing austerity measures, and developing growth strategies to help pay down the enormous debt.

 

The bottom line is that Bonds and home loan rates remain at historic best levels, which means now is still a great time to purchase or refinance a home. Let me know if I can answer any questions at all for you or your clients.

 

 
     

 

  Forecast for the Week  

 

     
  Economic reports will be plentiful – and important – this week:

  • The week kicks off Monday with the Core Personal Consumption Expenditure (PCE), which is the Fed’s favored gauge of inflation. This report will be closely watched, since any hint of an uptick in inflation could push Bond prices lower and, in turn, move home loan rates higher.
  • Manufacturing will also be in the spotlight with the Chicago PMI on Tuesday, followed by the ISM Indexon Wednesday.
  • Consumer Confidencewill also be delivered on Tuesday.
  • The ADP Private Employment Reportwill be released on Wednesday and comes before the government’s total job’s report on Friday.
  • As usual, Initial Jobless Claimswill be released on Thursday. This week’s report comes after an uptick of 21,000 last week.
  • Finally, on Friday the government’s monthly Employment Report will be released. The Employment Report consists of Non-farm Payrolls, the Unemployment Rate, Average Workweek and Hourly Earnings. This is an important report that can have a big impact on the markets. So I’ll be watching it closely.

 

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

 

As you can see in the chart below, Bonds and home loan rates remain near their historic bests. I’ll be watching closely to see which way they move next.

 

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Jan 27, 2012)

 

Japanese Candlestick Chart

 

 
     

 

  The Mortgage Market Guide View…  

 

     
      Share This SiteAnd Try it YourselfEvery once in a while, you come across a website that’s just plain fun. This is one of those sites.

 

We’ve all seen websites that provide stats about what happened the year you were born. The website whathappenedinmybirthyear.com/ takes it a step further. It doesn’t just offer stats and facts. Instead, it provides a picture of the world you grew up in – including what it looked like and how it was different than the world we live in today.

 

But it’s more than just a fun website.

 

For one thing, it provides you with a light-hearted reason to connect with your clients on a personal level. You can share the site with them on social media or in one of your outreach pieces (such as a newsletter or email).

 

In addition, this site offers you a unique way to better understand your clients. If you know when a client was born, you can simply type in the year. In return, you’ll get a picture of that client’s social influences that have helped shape him or her. And that’s exactly the kind of information you need to put yourself in your clients’ shoes and understand them a little better. Of course, it doesn’t hurt that it’s entertaining too!

 

Try the site todayand consider sharing it with your clients as a way to connect with them on a more personal level.

 

Economic Calendar for the Week of January 30 – February 03

 

Date
ET
Economic Report
For
Estimate
Actual
Prior
Impact
Mon. January 30
08:30
Personal Income
Dec
0.4%
 
0.1%
Moderate
Mon. January 30
08:30
Personal Spending
Dec
0.2%
 
0.1%
Moderate
Mon. January 30
08:30
Personal Consumption Expenditures and Core PCE
Dec
0.1%
 
0.1%
HIGH
Mon. January 30
08:30
Personal Consumption Expenditures and Core PCE
YOY
NA
 
1.7%
HIGH
Tue. January 31
08:30
Employment Cost Index (ECI)
Q4
NA
 
0.3%
HIGH
Tue. January 31
09:45
Chicago PMI
Jan
61.0
 
62.5
HIGH
Tue. January 31
10:00
Consumer Confidence
Jan
67.0
 
64.5
Moderate
Wed. February 01
08:15
ADP National Employment Report
Jan
250K
 
325K
HIGH
Wed. February 01
10:00
ISM Index
Jan
55.0
 
53.9
HIGH
Thu. February 02
08:30
Jobless Claims (Initial)
1/28
375K
 
377K
Moderate
Thu. February 02
08:30
Productivity
Q4
2.0%
 
2.3%
Moderate
Fri. February 03
08:30
Non-farm Payrolls
Jan
225K
 
200K
HIGH
Fri. February 03
08:30
Unemployment Rate
Jan
8.4%
 
8.5%
HIGH
Fri. February 03
08:30
Hourly Earnings
Jan
0.2%
 
0.2%
HIGH
Fri. February 03
08:30
Average Work Week
Jan
34.4
 
34.4
HIGH
Fri. February 03
10:00
ISM Services Index
Jan
53.0
 
52.6
Moderate

 

 

 
 
The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only and is not intended for consumer distribution. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors.
As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.
Mortgage Market Guide, LLC is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated.   Mortgage Market Guide, LLC does not grant to you a license to any content, features or materials in this email.   You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.
 
 
 Certified Mortgage Planner, Curtis Schartz, Home loan, Interest Rate, Interest Rates, kansas city, lees summit, lower interest, lower rates, Mortgage, mortgage backed securities, no cost refinance, overland park, Pulaski Bank, purchase, rate, Rates, Refinance, shawnee

 

Jan

21

  Last Week in Review:Rumors were swirling out of Europe, while inflation news was swirling here at home.

Forecast for the Week:The second half of the week heats up with news on the housing market and the state of the economy. Plus, the Fed meets.

View: A fee increase is coming that will impact home loan rates. Be sure to read the details below.

 

 
     
  Last Week in Review  
     
  It’s almost all Greek to me. Last week, more news from Greece hit the wires, as did several pieces of inflation news here at home. Read on to learn what happened, and what the impact was on home loan rates. First, it’s important to remember that back in October, a deal called for Bondholders to “accept” a 50% haircut on the face value of the Greek debt. Last week, rumors about this amount were swirling, saying that Greece is close to a deal that would entail a 68% haircut on the face value of their debt. And if that’s not concern enough, a larger issue remains.

 

 

After the proposed austerity measures, wage cuts, and tax increases are instituted, will Greece – not to mention Italy, Portugal, and other struggling economies – be able to “grow” their way out of debt? Given that the World Bank lowered its 2012 global growth forecast to 2.5% from last summer’s estimate of 3.6%, the odds sure seem tough. This is an important story to watch as the year unfolds.

Here at home, inflation was in the news twice last week…and the results were mixed. On Wednesday, the wholesale inflation measuring Core Producer Price Index (PPI) came in hot, elevating the year-over-year Core PPI rate to a lofty 3%…the highest since April 2009. Meanwhile, Thursday’s Core Consumer Price Index (CPI) was inline with expectations and tame overall, though it is worth noting that the 2.2% Core CPI year-over-year reading is near the upper end of the Fed’s tolerance level.

Remember, inflation is the archenemy of Bonds and home loan rates, like Kryptonite to Superman. That’s because inflation erodes the value of the fixed return provided by a Bond, which causes home loan rates to rise. It will be interesting to see what – if anything – the Fed says about inflation after it’s regularly scheduled meeting of the Federal Open Market Committee this week…as any talk or sign of inflation can move the markets and impact rates.

Even with all the news last week, it’s still a great time to purchase or refinance a home. Let me know if I can answer any questions at all for you or your clients.

 

 
     
  Forecast for the Week  
     
  The reports that will be released this week will carry some weight:

  • We’ll see a double dose of housing news with Pending Home Sales on Wednesday and New Home Saleson Thursday.
  • As usual, Initial Jobless Claimswill be released on Thursday. Last week’s read came in at 352,000, a drop of 50,000. That’s the biggest decline since September 2005!
  • We’ll also see two important reports that will show us how the economy is doing. Thursday brings the Durable Goods Report, which gives us a read on big ticket items. This will be followed by the first reading on Gross Domestic Product(GDP) for the Fourth Quarter of 2011 on Friday.
  • Finally, Consumer Sentiment will also be released on Friday.

In addition to those reports, the Federal Open Market Committee will hold a two-day meeting this week. The meeting will begin January 24 and end with a policy statement at 12:30 pm ET on January 25. There is no chance of a rate hike, but I will be listening for any hint of a third round of Quantitative Easing (QE3).

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, some encouraging economic and company earnings news last week helped halt the improving trend Bonds had been seeing. I’ll continue to monitor this situation.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Jan 20, 2012)

 

Japanese Candlestick Chart

 

 
     
  The Mortgage Market Guide View…  
     
      Fee Increase to Impact Home Loans

In December 2011, Congress reached a last-minute deal to fund the payroll tax cut extension. The payroll tax extension will provide a 2% tax reduction for individuals making up to $106,800, so the tax extension will be very helpful for many Americans who are struggling during these tough economic times. But like so many things in our tangled economy, there’s a flip side. In this case, the tax cut deal has a rippling effect that will impact the mortgage world.

Here’s what’s happening and what it means to home loan rates:

What is happening and why? To put it bluntly, the passage of the payroll tax cut extension is being funded via a mandate to Fannie Mae and Freddie Mac (the nation’s largest providers of mortgage money) to increase their guarantee fees or “g-fee’s” by at least 10 basis points on the rate. So rather than giving a par rate of 4.00%, for example, the par rate is now increased by at least 10 basis points, or approximately 4.10%. But as you probably knowhome loan rates are priced and offered in .125% increments, so this will most likely impact the consumer by .125% in rate. Whether you agree or not on the politics behind this cost being passed along to folks who are taking out mortgages, the Congressional Budget Office recently estimated that the increase will ultimately pay for about $35.7 Billion of the cost of the payroll tax extension.

What exactly is this “g-fee”? The guarantee fee or “g-fee” is an amount charged by mortgage-backed securities (MBS) providers, like Freddie Mac and Fannie Mae, to help protect against credit-related losses in the overall mortgage portfolio. In other words, it acts a lot like insurance and helps lower the overall riskwhich means home loans can be offered at terrific interest rates to borrowers that have good – but not perfect – credit.

What exactly is the impact of the rate increase? For example, for a $200,000 home loan, the increased g-fee (assuming a .125% increase in rate) would equate to $250 more per year in interest, or $7,500 more over 30 years. Someone buying or refinancing a home can certainly choose to buy down the cost with cash up front – but most folks will not do this.

Who will this impact? The change will impact all new borrowers of Fannie Mae and Freddie Mac loans. The bill will also impact Federal Housing Administration (FHA) loans by increasing the annual mortgage insurance premium that borrowers pay by one-tenth of a percent.

When will it start? Officially, the increase to guarantee fees will begin on April 1, 2012. However, the increase is already starting to be seen in rate sheets right now, since home loans being originated now will likely not be closed, pooled and securitized until Apriland therefore will need the increased g-fee priced in earlier.

How long will this be in effect? The increase will be effective through October 1, 2021.

The bottom line is that the g-fees will be going upand this will impact homebuyers looking to obtain a home loan through Fannie Mae, Freddie Mac and FHA.

The good news is that home loan rates are still at historic lows right now, and it’s a great time to purchase a new home or refinance. If you or anyone you know has any questions, please call or email!

Economic Calendar for the Week of January 23 – January 27

 

Date
ET
Economic Report
For
Estimate
Actual
Prior
Impact
Wed. January 25
10:00
Pending Home Sales
Dec
NA
 
7.3%
Moderate
Wed. January 25
12:30
FOMC Meeting
Jan
 
 
0.25%
HIGH
Thu. January 26
08:30
Jobless Claims (Initial)
1/21
NA
 
352K
Moderate
Thu. January 26
08:30
Durable Goods Orders
Dec
NA
 
3.8%
Moderate
Thu. January 26
10:00
New Home Sales
Dec
NA
 
315K
Moderate
Fri. January 27
08:30
Gross Domestic Product (GDP)
Q4
NA
 
1.8%
Moderate
Fri. January 27
08:30
Chain Deflator
Q4
NA
 
2.6%
Moderate
Fri. January 27
10:00
Consumer Sentiment Index (UoM)
Jan
NA
 
74.0
Moderate

 

   

 

 
 
The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only and is not intended for consumer distribution. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors.
As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.
Mortgage Market Guide, LLC is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated.   Mortgage Market Guide, LLC does not grant to you a license to any content, features or materials in this email.   You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.

Certified Mortgage Planner, Curtis Schartz, Home loan, Interest Rate, Interest Rates, kansas city, lees summit, lower interest, lower rates, Mortgage, mortgage backed securities, no cost refinance, overland park, Pulaski Bank, purchase, rate, Rates, Refinance, shawnee

Jan

15

Last Week in Review:Consumers are feeling good, but how good was last week’s news?Forecast for the Week:It’s a holiday shortened week, but the economic calendar is full. News on manufacturing, inflation, and housing is ahead.

 

View: Wondering what the housing trends for 2012 will be? Check out 11 trends we saw in 2011.

 

 
     

 

  Last Week in Review  

 

     
  “Happy days are here again.” Milton Ager and Jack Yellen.And while it seems that consumers are certainly feeling happier, not everything that happened last week was cause for song.There was good news last Friday, as the first look at Consumer Sentiment for January came in at 74.0, which is the highest level since May 2011. However, there was also news last week that the holiday shopping season may not have been as robust as previously thought.Retail Sales in December rose by a meager 0.1% from 0.4% in November, and when stripping out autos, sales actually fell 0.2%. Why did this happen? It seems that steep holiday discounting held down the value of goods sold, so sales were big, but only because of the heavy discounting.

 

The news out of Europe last week also wasn’t too happy. German Chancellor Angela Merkel and International Monetary Fund Managing Director Christine Lagarde met to discuss and finalize the debt restructuring deal for Greece. Back in October, a deal called for Bondholders to “accept” a 50% haircut on the face value of the Greek debt – but as creditors and authorities have started to forge a final deal, the actual haircut back to investors is looking quite likely to be larger than 50%. This is simply because worsening financial conditions in the Greek economy make paying the debt back with “just” a 50% haircut highly unlikely…maybe impossible. What’s more, the next reasonable question to consider is will Ireland, Portugal and even Italy ask for a similar haircut or deal on what may be unsustainable debt in their countries?

 

The happy news is that these problems are finally being addressed to make things better in the future. And in the short term, the uncertainty should keep money flowing into the relative safe haven of the US Dollar and US Bonds – including Mortgage Bonds, to which home loan rates are tied. In addition, Mortgage Bonds continue to be supported by the Fed’s purchases, which are also helping to keep home loan rates at record low levels.

 

All of this means that now continues to remain a great time to purchase or refinance a home. Let me know if I can answer any questions at all for you or your clients.

 

 
     

 

  Forecast for the Week  

 

     
   Despite the Bond Markets and all Capital Markets being closed on Monday in observance of Martin Luther King, Jr. Day, the rest of the week’s economic calendar is full:

 

  • Manufacturing strong? The week’s economic data kicks off on Tuesday with a manufacturing indicator from New York’s Empire State Index for January. In addition, the Philadelphia Fed Indexfor January will be released on Thursday. Last month, both reports reached their highest levels in months. Remember: The Stock Market likes to see healthy economic growth because that translates to higher corporate profits. However, the Bond market prefers a moderate growth environment that won’t generate inflationary pressures.
  • Speaking of inflation We’ll see inflation reports on the wholesale level in the Producer Price Index on Wednesday, followed by the Consumer Price Indexon Thursday. Inflation has remained tameand Bondholders will be closely watching these two indicators for any signs of an uptick.
  • Back on track this week? Initial Jobless Claimswill be released as usual on Thursday. Last week’s number showed an uptick in claims and broke the recent trend of decreasing claims. However, the rise could have been due in part to layoffs of seasonal holiday workers. So the markets will be watching to see if this report gets back on track with the recent positive trend.
  • No place like home! Housing data in the form of Housing Starts, Building Permits and Existing Home Sales will all be reported this week. Housing continues to troll around low levels despite record low home loan rates.

 

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

 

As you can see in the chart below, Bonds and home loan rates are continuing their improving trend. I’ll be watching this closely as we head further into the new year.

 

 

 

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Jan 13, 2012)

 

Japanese Candlestick Chart

 

 
     

 

  The Mortgage Market Guide View…  

 

     
      Housing News: 11 Trends from 2011 The National Association of Realtors surveys homebuyers and sellers each year to uncover housing trends and monitor changes taking place in the industry. This year’s report highlights a number of trends that haven’t been seen in years. Here are just 11 highlights from the 2011 report.

1. In 2011, 37% of homebuyers were first-time buyers – which was down from 50% in 2010.

2. Last year, 88% of homebuyers used the Internet to search for a home. That number was down slightly from a high of 90% in 2009.

3. The typical homebuyer searched for 12 weeks and viewed 12 homes.

4. The number of buyers who purchased their home through a real estate agent or broker climbed to 89% – a share that has steadily increased from 69% in 2001.

5. Nearly 1 out of 4 buyers said the application and approval process was “somewhat more difficult” than expectedand 16% reported it was “much more difficult” than expected.

6. About half of home sellers traded up to a larger and more expensive homeand 60% traded up to a new home.

7. The top 3 factors influencing neighborhood choice were: the quality of the neighborhood, the convenience to job, and the overall affordability of homes.

8. The typical seller lived in their home for 9 years. That number has increased from 6 years in 2007.

9. Although 61% of sellers said they reduced their asking price at least once, the average home sold for 95% of the listing price.

10. Only 10% of sellers sold their homes without the assistance of a real estate agent. Of those people, 40% knew the buyer prior to the sale.

11. The typical “for sale by owner” home sold for $150,000 compared to $215,000 for the average agent-assisted home sale.

 

All Contents 2012 The National Association of Realtors.

 

Economic Calendar for the Week of January 16 – January 20

 

Date
ET
Economic Report
For
Estimate
Actual
Prior
Impact
Tue. January 17
08:30
Empire State Index
Jan
10.0
 
9.5
Moderate
Wed. January 18
08:30
Producer Price Index (PPI)
Dec
0.1%
 
0.3%
Moderate
Wed. January 18
08:30
Core Producer Price Index (PPI)
Dec
0.1%
 
0.1%
Moderate
Wed. January 18
09:15
Industrial Production
Dec
0.5%
 
-0.2%
Moderate
Wed. January 18
09:15
Capacity Utilization
Dec
78.1%
 
77.8%
Moderate
Thu. January 19
10:00
Philadelphia Fed Index
Jan
10.0
 
10.3
HIGH
Thu. January 19
08:30
Building Permits
Dec
680K
 
681K
Moderate
Thu. January 19
08:30
Housing Starts
Dec
670K
 
685K
Moderate
Thu. January 19
08:30
Consumer Price Index (CPI)
Dec
0.1%
 
0.0%
HIGH
Thu. January 19
08:30
Core Consumer Price Index (CPI)
Dec
0.1%
 
0.2%
HIGH
Thu. January 19
08:30
Jobless Claims (Initial)
1/14
387K
 
399K
Moderate
Fri. January 20
10:00
Existing Home Sales
Dec
4.57M
 
4.42M
Moderate

 

 

 
 
The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only and is not intended for consumer distribution. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors.
As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.
Mortgage Market Guide, LLC is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated.   Mortgage Market Guide, LLC does not grant to you a license to any content, features or materials in this email.   You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose. 

Certified Mortgage Planner, Curtis Schartz, Home loan, Interest Rate, Interest Rates, kansas city, lees summit, lower interest, lower rates, Mortgage, mortgage backed securities, no cost refinance, overland park, Pulaski Bank, purchase, rate, Rates, Refinance, shawnee

Jan

10

Last Week in Review:Unemployment hit a three-year low. How did Bonds and home loan rates react?Forecast for the Week: The second half of the week will be a busy one, with news on retail sales, consumer sentiment, and more.

View: Want some help keeping your New Year’s Resolutions? There’s an app for that!

 

Last Week in Review

 

 

“Workin’ nine to five. What a way to make a livin.'” Dolly Parton. And with last week’s Jobs Report showing that unemployment has reached three-year lows, that’s something more people have been able to do lately. Read on to learn more about what’s happening in the labor market…and with home loan rates.On Friday, the Labor Department reported that 200,000 jobs were created in December, with 212,000 private job gains offsetting modest losses in government jobs. Adding to the positive spin of the report was the Unemployment Rate falling to 8.5% from a previously reported and upwardly revised 8.7% reading.While people being removed from the labor force are skewing this unemployment number to some degree, it’s important to note that the U-6 unemployment rate dropped a few ticks as well, to 15.2%. This number includes ALL unemployed individuals, including those “marginally attached” to the labor force, who are either ‘discouraged’ and haven’t sought work recently, as well as those folks working part-time who really desire full-time jobs.

Overall the Jobs Report was a modestly positive reading on the labor market. We still have 5.6 million people unemployed for 27 weeks or more, and that number is little changed this month. But the big takeaway today is that the trend is improving.

The other big takeaway is that bad news out of Europe helped balance out the good Jobs news here at home…allowing Bonds and home loan rates to recover from their initial negative reaction to the Labor Department’s report. The Euro is continuing to be weighed down by rising concern on member countries’ ability to get their deficits in order and their debt in manageable position.

The bottom line is that the problems in the Eurozone are vast, complicated, and without easy solutions…so it will take a very long time for clear resolution. And during times of global uncertainty, money will flow into the relative safe haven of the US Dollar and US Bonds – including Mortgage Bonds, which home loan rates are tied to. This means that home loan rates should continue in their sideways trend and remain near historic lows, making now a great time to purchase or refinance a home. Let me know if I can answer any questions at all for you or your clients.

 

Forecast for the Week

 

 

 

The second half of the week features several important economic reports:

  • The Fed’s Beige Bookwill be released on Wednesday. This is a report on economic conditions from the 12 Federal Reserve District Banks around the country.
  • Initial Jobless Claims will be released on Thursday. Last week’s number fell by 15,000 to 372,000 and the report signaled that the labor market could be turning the corner to greener pastures.
  • Retail Saleswill be released on Thursday and will be closely watched by both investors and traders. Last week, it was reported that retailers saw better-than-expected revenues for same-store sales in December, but the numbers were achieved by big discounts. Sales on Black Friday were robust, but fell off in the ensuing weeks during December. So the markets will be watching closely for the final numbers this week.
  • The first look on Consumer Sentiment for January will be released on Friday.

In addition to those reports, the Treasury Department will sell a total of $66 Billion in government securities on Tuesday, Wednesday, and Thursday. Those auctions could impact the markets, depending on how they’re received. So, I’ll be watching the results – and their impact – closely.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

As you can see in the chart below, Bonds and home loan rates remain near their record best levels. I will be monitoring this closely in the weeks ahead.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Jan 06, 2012)
Japanese Candlestick Chart

 

The Mortgage Market Guide View…

 

 

There’s an App for That New Year’s Resolution!Making It Happen, Part 2

In last week’s View article, we focused on 5 steps to achieving your New Year’s Resolutions. Those steps included: setting realistic goals, making a simple plan for each goal, announcing your goals, tracking and celebrating your progress, and avoiding the urge to give up if you have a setback.

Luckily, you’re not on your own to work through those steps. That’s because there are a number of social media websites and smart phone applications designed to help you.

Obviously, popular apps like Facebook and Twitter can help you announce your goals, hold yourself accountable, and receive supportive feedback from friends and family members. But there are a number of additional resources that you may not know about.

Here are just 5 social media sites and apps that can help you set your New Year’s resolutions…and stay on track!

1. Tweet Reminders. Twitter is great for connecting with people and sharing news instantaneously. But did you know it’s also a great way to remind yourself about tasks? Need a reminder to go to the gym… or to call those past clients? No problem. Visit the Tweet Reminders site, and then enter your Twitter username and up to 5 tasks or reminders. You can even pick a date and time. Then, Tweet Reminders will send you a direct message on Twitter to remind you about them. It’s both an easy and helpful thing to do.

2. Moteevate. Regardless of whether your goal is big or small, this site has the inspiration, energy, and advice you need to reach it. With moteevate, you get support from people you already know as well as advice from experts in the field – all while being surrounded by people looking to achieve similar goals. You can even moteevate in teams and act as moteevators for each other. The site also includes cool trackers to record your progress and milestones. Plus, you can customize the privacy settings to keep your goals to yourself or share them with others. And best of all, the basic platform is free to use with the caveat that you pay whatever you want after you achieve your goal. In fact, this honor system is the only thing old-fashioned about moteevate.

3. Toodledo. This is a businessperson’s dream app. You’ve no doubt seen a To-Do list before…but this app kicks it up a notch! Not only does it help you easily organize your tasks and set alarms, but it also allows you to collaborate with other people and establish sub-tasks to work towards your goal in small steps! Plus, Toodledo can be used on your mobile phone, in your email, on your calendar, and even integrated directly into your web browser. So you can stay on track from anywhere…and at any time.

4. StickK. The basic principle of this app is that “incentives get people to do things.” So if you really want to achieve a goal – whether it’s personal or professional – it’s time to put your money where your mouth is. Basically, stickK allows you to create a Commitment Contract focused on achieving a specific goal. As part of the process, you set your goal and timelines, stakes, referee who will monitor your progress, and supporters who will cheer you on. If you achieve your goal in your timeframe, you don’t lose the stakes you wagered. But – the best part is – even if you don’t achieve your goal, the money you wagered goes to a worthy cause or charity that you designate. So it truly is a win-win situation!

5. GymPact. This is similar to stickK in that you put money on the line…but it’s different in that you can also earn some money. You start by making a commitment that you will go to the gym a certain number of times per week (don’t worry, you can change your pact any week). You also set the monetary stakes that you’ll pay if you don’t meet your commitment. Then, you simply use the GymPact iPhone app to check in when you go to the gym. When you meet your weekly goal, you’ll be rewarded with real cash, funded by the people who didn’t work out! The more days you commit, the more cash you earn. The only downside is that you need an iPhone (or an iPod Touch and a gym with Wi-Fi) to participate, since apps for other systems aren’t available.

Of course, this is just the tip of the iceberg when it comes to social media websites and apps designed to help you set and achieve your goals. Best wishes to you in the coming weeks and months.

And, if your New Year resolutions involve any financial or housing matters that I can help with, please call or email today. I’ll be happy to help out in any way that I can.

Economic Calendar for the Week of January 09 – January 13

Date
ET
Economic Report
For
Estimate
Actual
Prior
Impact
Wed. January 11
02:00
Beige Book
 
 
 
 
Moderate
Thu. January 12
08:30
Jobless Claims (Initial)
1/7
375K
399K
375K
Moderate
Thu. January 12
08:30
Retail Sales
Dec
0.4%
0.1%
0.4%
HIGH
Thu. January 12
08:30
Retail Sales ex-auto
Dec
0.4%
-0.2%
0.3%
HIGH
Fri. January 13
10:00
Consumer Sentiment Index (UoM)
Jan
71.0
 
69.9
Moderate

 

 

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is without errors.
As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.
 

Certified Mortgage Planner, Curtis Schartz, Home loan, Interest Rate, Interest Rates, kansas city, lees summit, lower interest, lower rates, Mortgage, mortgage backed securities, no cost refinance, overland park, Pulaski Bank, purchase, rate, Rates, Refinance, shawnee

Jan

4

  Last Week in Review:Consumer Confidence here in the U.S. is on the rise, but what does that mean for home loan rates?Forecast for the Week: The Markets will be closed on Monday for the New Year holiday, but we will see important news on the Jobs Market after that.

 

View: Are you “resolved” to keep your New Year’s Resolutions this year? The tips below will help!

 

 
     

 

  Last Week in Review  

 

     
  It’s been said that “the only constant is change.” And we certainly saw a lot of changes in 2011. As we ring in 2012, here’s a look at how 2011 ended, and what lies ahead for home loan rates. The Stock and Bond Markets were closed on Monday in observance of the Christmas holiday, and it was a fairly quiet week after that. However, there was some good news, as Consumer Confidence came in at 64.5 for December. Not only was this the third highest number reported for 2011, but this important index has jumped nearly 25 points in the past three months and now sits at its highest level since April. What’s more, this report followed the recent Consumer Sentiment Index reading, which also came in at its highest level in six months.

 

While consumers certainly appear more optimistic here, the news hasn’t been as positive out of Europe. The Euro struggled somewhat last week after just an okay performance from one of Italy’s Bond auctions. While the country sold all their debt at yields slightly lower than where they were just the day prior, yields are still historically high (near 7% on 10-Year Notes) for a country that has a lot of debt to service and refinance in the coming year. In addition, Spain’s government announced on Friday that the country’s budget deficit will surpass 8%. Spain also unveiled new austerity measures to combat their economic and budgetary difficulties.

 

So what does all of this mean for home loan rates here in the U.S. in 2012? The uncertainty in Europe should continue to help Bonds and home loan rates, as investors will see our Bonds as a safe haven for their money – and remember, home loan rates are tied to Mortgage Bonds, so rates typically improve as Mortgage Bonds improve. However, continued good economic reports here in the U.S. could balance out those improvements. That’s because investors will typically move their money out of Bonds and into Stocks during good economic times, so they can take advantage of gains.

 

The bottom line is that whatever lies ahead this year, 2012 begins with home loan rates near historic lows…which makes this a great time to purchase or refinance a home. Let me know if I can answer any questions at all for you or your clients.

 

 
     

 

  Forecast for the Week  

 

     
  The Stock and Bond Markets will be closed on Monday, January 2, in observance of the New Year’s holiday, but the week will be a busy one after that.

  • Tuesday brings the Federal Open Market Committee Minutesfrom the Fed’s last meeting in 2011. The Markets will be especially interested to hear what the Fed may have said about inflation.
  • The ISM Services Index will be reported on Thursday. This report gives investors a gauge as to how the service sector is holding up in this economy. Individuals employed in this sector produce services rather than products. Service sector jobs provide a significant number of jobs in the US – including housekeeping, messenger services, tax preparation, nursing, and teaching.
  • Also on Thursday, we’ll see another weekly Initial Jobless Claims Report. It is encouraging to see that Claims remain beneath the 400,000 mark, which is a sign that the labor market is improving.
  • The biggest news of the week will be Friday’s Jobs Report, as the Labor Department reveals the latest unemployment figures and how many new jobs were created in December.

 

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result.

 

As you can see in the chart below, Bonds and home loan rates remain near their historic best levels. I’ll be keeping a close eye on this as the year progresses.

 

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Dec 30, 2011)

 

Japanese Candlestick Chart

 

 
     

 

  The Mortgage Market Guide View…  

 

     
      Making It Happen!Part 1: 5 Simple Steps for Achieving Your New Year’s Resolutions

 

Each new year is full of promise and potential. Perhaps that’s why so many of us choose this time of year to make positive changes in our lives.

 

And, believe it or not, achieving your goals can be easier than you think. The following 5 steps can help you get started and follow through!

 

1. Set realistic goals. The first step to your successful New Year’s resolutions is to set realistic goals for the coming weeks and months. You can start by focusing on the things you’re passionate about or the things you’ve always wanted to do. Maybe it’s a worthy cause you want to become involved in…or maybe you want to kick a habit that’s bothered you for years. If it’s something that you’re passionate about, you’ll have a better chance of being successful. Once you have the topic, make sure you write down a specific, attainable goal. It’s not enough to just think about doing something. Come up with a specific statement you want to achieve. For example, the most common resolution is to lose weight. But that’s not specific enough. Write down exactly how much weight you want to lose and by when. But make it realistic…and healthy at the same time.

 

2. Make a simple plan to achieve each goal. Once you have your goals written down, take the resolution a step further by figuring out how you’ll achieve it. That means breaking the goal down into simple steps that you can achieve over time. And, often, it means multiple little steps. So, for the weight loss resolution, you may write down a number of simple, daily or weekly steps – such as exercise 20 minutes three times a week, eat vegetables and fruit with each meal, switch to diet cola or better yet water during the day, and lose a certain number of pounds per month. Remember to consult a physician before starting any weight loss or exercise routine to make sure you’re approaching it in a healthy manner.

 

3. Announce your goals. One of the best ways to make sure you stick to your goals is to make them known to your friends, coworkers, and family members. The reality is, once you’ve told people you’ll do something, you’ll feel more accountability than if you just keep it to yourself. You’ll also have a cheering section to help you stay focused and positive as you work to achieve your goals. But don’t just share your goals; share the specific steps that you’re going to take each day or week to achieve those goals. If you use any social media websites to connect with friends and family, make your goals and steps part of your daily/weekly updates…it’s a great way to get the word out and hear feedback from people who want to help you stay on track.

 

4. Track and celebrate your progress. Small steps aren’t just about making your way to a goal; they’re also about building momentum, a positive attitude, and celebrating successes along the way. There are a number of ways to track and celebrate your success. For example, if your goal is to work out 20 minutes a day three times a week, you can use a marker and a calendar. Each day you work out, simply color that day in green (or another positive color that you like). As the month unfolds, you’ll see more and more green covering the calendar, which will help you see just how much work you’ve done and keep you motivated to keep going. In addition, you can also use social media to track and celebrate your success. Maybe you tweet or update your Facebook status every time you exercise. Or maybe you announce when you’ve lost a few pounds. The point is, you’ve already announced your goals to friends and family as a way to hold yourself accountable, now it’s time to celebrate with those same people every time you achieve a step along the way.

 

5. Don’t get discouraged. You’re bound to have good weeks and bad weeks. Just because you fall off track once or twice doesn’t mean you should give up. Instead, acknowledge that you had a bad day or week, figure out what happened to throw you off track (maybe it was a busy or stressful week), and then make a plan to overcome the problem if it happens again. For example, if you had a tough week at work that required you to work late and miss the trip to the gym, make a plan to be proactive the next time work gets busy. Perhaps you make a plan to walk during your lunch break or wake up early to do jumping jacks and push-ups before heading into the office. But…whatever you do…don’t give up on your goals or yourself. Review your plan and recommit yourself to those simple steps. You can even use social media to acknowledge a mistake and commit to overcoming that problem in the future. That way, you’ll have a new sense of accountability and support from your friends and family.

 

Best wishes to you in achieving all your goals and dreams this year. And if your New Year’s resolutions involve any financial or housing matters that I can help with, please call or email today. I’ll be happy to help out in any way that I can.

 

Economic Calendar for the Week of January 02 – January 06

 

Date
ET
Economic Report
For
Estimate
Actual
Prior
Impact
Tue. January 03
10:00
ISM Index
Dec
53.0
 
52.7
Moderate
Tue. January 03
10:00
Construction Spending
Nov
.8%
 
.8%
Low
Tue. January 03
02:00
FOMC Minutes
Dec 13
 
 
 
Low
Wed. January 04
10:00
Factory Ord. & Manufacturing Inventories
Nov
1.9%
 
-0.4%
Moderate
Thu. January 05
08:30
Jobless Claims (Initial)
12/31
375K
 
381K
Moderate
Thu. January 05
10:00
ISM Services Index
Dec
53.0
 
52.0
Moderate
Fri. January 06
08:30
Non-farm Payrolls
Dec
150K
 
120K
HIGH
Fri. January 06
08:30
Unemployment Rate
Dec
8.7%
 
8.6%
HIGH
Fri. January 06
08:30
Hourly Earnings
Dec
0.2%
 
-0.1%
Moderate
Fri. January 06
08:30
Average Work Week
Dec
34.3
 
34.3
Low

 

 

 
 
The material contained in this newsletter has been prepared by an independent third-party provider. The content is provided for use by real estate, financial services and other professionals only and is not intended for consumer distribution. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, there is no guarantee it is without errors.
As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.
Mortgage Market Guide, LLC is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated.   Mortgage Market Guide, LLC does not grant to you a license to any content, features or materials in this email.   You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.
 

Certified Mortgage Planner, Curtis Schartz, Home loan, Interest Rate, Interest Rates, kansas city, lees summit, lower interest, lower rates, Mortgage, mortgage backed securities, no cost refinance, overland park, Pulaski Bank, purchase, rate, Rates, Refinance, shawnee