News & Notes on the Notoriously Unpredictable Market
Signs of possible stability coming back into the financial and mortgage markets have appeared once again this week. To what do we owe the positive news? Frankly, your guess is as good as mine, as trying to predict what will happen from day to day has become an exercise in futility!.
However, I do try to seek out the variables which seem to have the most impact on our rates, our housing markets and our economy. Here are a few items that seem to indicate that things are looking a bit better this week.
· The aftermath of the FED bailing out Bear Stearns via lending Chase Morgan nearly $30 billion to buy the troubled investment house led to panic. Then, just as we were all getting comfortable with the panic and the seemingly second coming of the Great Depression; news arrives that Lehman Brothers Holdings actually raised $1 Billion more in liquidity than predicted-in one night! What does this mean? It means that investors are still investing in financial institutions- good news!
· Over the course of the last few days, mortgage rates have stabilized as well. The gap in interest rates between the new conforming jumbo loans, and conventional loans is narrowing. Better pricing is a great indication of stabilization.
· The talk of overhauling our financial regulations hit a peak in the media yesterday, insinuating that this reform was imminent. Good news prevails though, as this reform will not take place immediately, so the chances of an over correction are reduced.
· Finally, stocks have rallied a bit of late. This is leading many to think that we may have seen the worst of the credit crunch. Now if the economy will just cooperate!
While none of these items alone are enough to say (with any degree of certainty) that the real estate and mortgage markets will improve soon, together they paint a slightly sunnier outlook than we've been seeing of late.
Stay tuned!
However, I do try to seek out the variables which seem to have the most impact on our rates, our housing markets and our economy. Here are a few items that seem to indicate that things are looking a bit better this week.
· The aftermath of the FED bailing out Bear Stearns via lending Chase Morgan nearly $30 billion to buy the troubled investment house led to panic. Then, just as we were all getting comfortable with the panic and the seemingly second coming of the Great Depression; news arrives that Lehman Brothers Holdings actually raised $1 Billion more in liquidity than predicted-in one night! What does this mean? It means that investors are still investing in financial institutions- good news!
· Over the course of the last few days, mortgage rates have stabilized as well. The gap in interest rates between the new conforming jumbo loans, and conventional loans is narrowing. Better pricing is a great indication of stabilization.
· The talk of overhauling our financial regulations hit a peak in the media yesterday, insinuating that this reform was imminent. Good news prevails though, as this reform will not take place immediately, so the chances of an over correction are reduced.
· Finally, stocks have rallied a bit of late. This is leading many to think that we may have seen the worst of the credit crunch. Now if the economy will just cooperate!
While none of these items alone are enough to say (with any degree of certainty) that the real estate and mortgage markets will improve soon, together they paint a slightly sunnier outlook than we've been seeing of late.
Stay tuned!
Labels: Ed Craine, Finance, Statistics for Redwood City
posted by Unknown | 11:15 PM
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