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Once Bitten, Twice Shy: ADP Says Jobs Were Lost in December

January 10, 2007

After last week’s data showed ongoing strength in the U.S. economy, there is a growing sentiment that the Fed will choose to raise the Fed Funds Rate before it begins lowering it. FFR currently stands at 5.250% and here is what markets are predicting over the near-term: After January 30-31 Meeting: Decrease to 4.750: 0% […]

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How Will Oil’s Plunging Prices Impact Mortgage Rates

January 9, 2007

This summer, oil crossed the $77 threshold per barrel and since then, it has been on a steady decline. Today, it crossed $58 per barrel. Lower prices for oil should reduce heating bills and gas pump receipts for Americans this winter. High oil prices are a stimulus for inflation so on the surface this would […]

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How Inverted Yield Curves Defy “Normal” Financial Behavior

January 8, 2007

Interest rates remain inverted, a market condition in which the longer you commit to lending your money, the less that you earn on your investment. Why is that a big deal? Imagine if a friend asked you to borrow money for two years you charged him interest on that money. We can list some of […]

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How Today’s Jobs Report Surprised Traders

January 5, 2007

This morning’s Non-Farm Payrolls report (i.e. the number of new jobs created for industries other than farming) registered a 167,000 gain in November This is tremendously higher than the 115,000 jobs economists had predicted. Markets were caught leaning in the wrong direction after an ADP report released Wednesday said that 40,000 jobs were likely lost […]

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Once Bitten, Twice Shy: ADP Says Jobs Were Lost in December

January 4, 2007

This summer, economists were predicting that 175,000 new jobs were created in June and then payroll processor ADP shared their own estimate of 368,000 with the markets. In a panic, mortgage rates moved higher because – well, what if ADP was right?!? The actual figure turned out to be 121,000. That major miss jolted the […]

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Markets Closed in Observance of President Ford’s Death

January 2, 2007

In observance of President Ford’s death, the NYSE, NASDAQ and the Federal Reserve Board are closed today. This marks the first time that markets are closed for four consecutive days since the days following the attacks on September 11, 2001. Despite the closures, the Federal Reserve’s regional banks will continue to operate as usual so […]

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Vacation Days Are Good – Unless You’re The One Left Behind

December 29, 2006

As we head into the last day of trading in 2006, there are a lot of market players that have already left for the long weekend. That’s good for them, but rough for everyone else left behind. With so many traders on vacation this week, there are fewer buyers and fewer sellers at any given […]

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New Homes Sales Is Less Important Than New Homes Closed

December 28, 2006

Yesterday’s New Home Sales report revealed the following signs of immense strength in the housing sector and mortgage rates are moving higher on the news. Sales registered 1.047 million versus the expectation of 1.015 million — a difference of 3.15%. Sales were revised higher by 46,000 over the past three months. Inventory levels dropped to […]

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It’s Not The House That Matters, It’s The Stuff You Buy For The House That Does

December 26, 2006

With many traders on vacation this week, the impact of economic reports on mortgage rates will be amplified. Specifically, be wary of this week’s New Home Sales and Existing Homes Sales reports. Since July, the Fed has repeatedly told us that housing will lead to an economic slowdown. As a result, markets have placed housing […]

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