In This Issue 
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| Last Week in Review:The volatility out of Europe continued, along with the arrival of Friday’s Jobs Report for October.Forecast for the Week: It’s a quiet week when it comes to economic reports, plus the Bond Market is closed Friday for Veterans Day.
View: Don’t miss these special deals in honor of America’s veterans. |
| Last Week in Review |
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“The only things we can be sure of are death and taxes.” Benjamin Franklin. And lately, volatility in the markets is another certainty…and last week was no exception. Read on to learn about the week’s big newsmakers, and what they meant for home loan rates. Friday’s Jobs Report from the Bureau of Labor Statistics was a big market mover, showing that 80,000 jobs were created in October, which was just slightly below expectations. In addition, 104,000 private sector jobs were created, also just below expectations while the unemployment rate dropped to 9%, from a previous reading of 9.1%. A big positive in the report was once again upward revisions to prior month’s readings, which showed 102,000 more jobs created in the two previous months than what was originally reported.
The takeaway from the report is that it doesn’t appear the economy is slipping into another recession…at least not yet. The labor market continues to create jobs, but at a very slow and uneven pace. Until we see significant job growth–north of 150,000 each month, for a sustained amount of time–we won’t see meaningful improvement in the economy or the unemployment rate. This turn means that rates should continue to hover at low levels, albeit in a volatile fashion. Also limiting how high our rates can go is the ongoing European drama. The removal of the referendum (Greek Prime Minister George Papandreou had announced he would put the Euro rescue plan to a referendum or vote amongst the Greek people) is one piece of uncertainty taken away from the market–and that was a big one. However, there are still so many things that can and probably will go wrong until the European leaders put a big, realistic, attainable solution into action. For instance, Italy’s Bond yields continue to inch higher, suggesting that their debt problems won’t easily be solved and continue to creep towards an unmanageable state. Plus, Fed Chairman Ben Bernanke said Wednesday during his speech after the regularly scheduled meeting of the Federal Open Market Committee that purchases of Mortgage Bonds are being considered–which is another factor that could benefit home loan rates. The bottom line is that home loan rates are still near historic lows, which makes 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 |
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While the Stock Markets are open Friday, the Bond Market will be closed in honor of Veterans Day. And with fewer economic reports this week–and with earnings season essentially behind us-the Bond Market will take direction from a number of factors.
In addition to those reports, the headlines coming out of Europe will continue to influence the markets here in the US, including Bonds and, as a result, home loan rates. Also, this week’s Treasury auctions totaling $72 Billion could be a big market mover, depending on how they’re received. 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 were able to take advantage of the decrease in Stocks last week, due in part to the uncertainty out of Europe. I’ll be monitoring this situation closely in the weeks ahead. Chart: Fannie Mae 3.5% Mortgage Bond (Friday Nov 04, 2011)
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| The Mortgage Market Guide View… |
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| Meals and Deals for Veterans Day!This Friday, November 11, 2011 is Veterans Day. That means it’s the perfect opportunity to honor America’s veterans for their patriotism, love of country, and commitment to serve and sacrifice for the common good of the USA.
Need a few ideas of what to do? What if you could go out to eat…go to an amusement park… and much more for free or a special discount? Well, if you’re a Veteran, you can! Don’t Plan Your Day Until You Read This Believe it or not, hundreds of companies around the country offer special Veterans Day deals, including:
Look No Further The best part is that you can find the details about all these deals in one place! Just visit The Military Wallet’s listing for up-to-date Veterans Day free meals and discounts! And happy Veterans Day to all the men and women who have served our country in the past…and continue to guard our nation! Economic Calendar for the Week of November 07 – November 11
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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.
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