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SHORT-TERM TREND (20 days or less) Tilted slightly in favor of lower note rates and higher investor prices – but struggling to hold direction.
LONG-TERM TREND (21 days or more) Favors higher note rates and lower investor prices. |
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Commentary: The mortgage interest rates are being supported at unchanged levels in this morning’s early going by some “flight-to-quality” buying created by a sell-off in the stock markets -- and some serious head-scratching by mortgage investors over the real meaning of today’s sharply higher inflation numbers form the wholesale sector.
The Labor Department’s producer price index, a measure of prices at the factory door, surged 1.2% higher in July after posting a 1.8% gain in June. The core producer price index, a value that excludes the more volatile food and energy components, posted an increase of 0.7% -- its largest monthly gain since November 2006. The core rate value was 300% higher than most economists’ forecast for a July gain of 0.2%.
The outsized gains reported in the July producer price index pounded the stock markets with a round of heavy selling – but remarkably – mortgage investors and other fixed-income market participants barely blinked.
From everything I can gather from what I’ve read and picked up in telephone conversations with other reliable and experienced market sources – it appears that a growing number of traders believe the worst of the price pressures at both the producer and consumer level are over. Oil prices have fallen more than 20% from their July highs with other commodities like copper (down 15%) and corn (down 14%) helping to ease inflation concerns. Many market participants are beginning to think that July was the peak for raw and intermediate goods prices and the probabilities are growing that we will now begin a snail’s pace deceleration of inflationary pressures that will pick up speed into the mid-part of 2009. I personally think it is far too early to deem the inflation threat to be yesterday’s story – and those that have already begun to dance in the street because the wicked witch is dead -- may find their party coming to an abrupt and financially painful halt.
In a separate report the Commerce Department reported housing starts fell 11% in July to their lowest annual rate in more than 17 years, while building permits, an indicator of future construction activity, slumped by 17.7%. The big decline in July was largely payback from a surge in June construction driven by builders’ scrambling to beat the July 1st enforcement date for a new building code in New York City. The decrease in housing starts was lead by a 30% decline in the Northeast while construction fell by 8.2% in the South and the West and gained 10.0% in the Midwest. As usual the Commerce Department reminded everybody that it’s monthly housing data is volatile and subject to large sampling and other statistical errors. In most months, the government says it can’t be really sure whether starts actually increased or decreased. I don’t know about you – but I’ve often wondered why the Commerce Department just doesn’t wait until they have solid, statistically valid numbers before they say anything to anybody at all. Hmm, I guess that idea would make too much sense – a condition I’m assuming which must immediately invalidate its usefulness to anyone at the governmental level. |
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7702 Spring Creek
Baytown, Texas 77520
$249,000
Renee Beattie 713-553-7813
Remax Westside
Date listed on this site: 8/19/2008
View Web Site View Flyer |
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3220 69TH ST F-2
GALVESTON, Texas 77551
$105,000
Sandy Ashford 713-782-4444
Sandy Ashford Realtors
Date listed on this site: 8/19/2008
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24307 Travis House
KATY, Texas 77493
$170,000
Clara Jean Machann (832) 656-3993
Town and Country Locators
Date listed on this site: 8/19/2008
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111 DUNBAR ESTATES DR 701
FRIENDSWOOD, Texas 77546
$69,900
Traci Lee Williams 281-702-6212
R.E.O. of Texas
Date listed on this site: 8/18/2008
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7447 CAMBRIDGE ST 15
HOUSTON, Texas 77054
$207,775
Gail Jacobs 713.530.6320
Keller Williams - The Metropolitan
Date listed on this site: 8/18/2008
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7705 Spinnaker Cove
Rowlett, TX 75089
$137,000
Donna Pfluge 214-924-7791
Coldwell Banker Apex
Date listed on this site: 8/18/2008
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330 LAS COLINAS BLVD. #140
IRVING, TX 76038
$142,500
Melinda Stanley (972) 816-5555
ZipRealty
Date listed on this site: 8/17/2008
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2700 Clark Drive
Corinth, TX 76210
$150,900
Melinda Stanley (972) 816-5555
ZipRealty
Date listed on this site: 8/17/2008
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& Date |
Announcement |
TSML Assigns Sweetwater the Highest Possible Compliance Rating!
5/3/2007 |
During a recent examination, the Texas Department of Savings and Mortgage Lending assigned Sweetwater the highest possible compliance rating of a "1"! According to TSML definition, this means that Sweetwater is in a "strong compliance position". |
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