Mortgage Market Report for Tuesday May 13, 2008

A better than expected Retail Sales Report are putting a downward pressure on mortgage bonds.  Confirming this were sales from Wal-Mart with a better than expected first-quarter results. But it is expected that the second quarter will not be as good due to rising food and energy prices.   Just a fill up at the gas station will tell you that.  However, the consumer continues to spend for now.  

Federal Reserve Chairman Big Ben Bernanke spoke this morning and said financial markets remain unsettled and the Central Bank will increase its auctions of cash to banks as needed.  He went on to say "while markets have improved, they remain far from normal and we stand ready to increase the size of the auctions if further warranted by financial developments''.

For now a carefully floating bias may be prudent.   The Bond bounced higher off the floor of support  twice in the past 30 days and has done so thus far today.  The trend is usually your friend.

Thank you for listening to www.ContactHerrick.com .  We will have another report for you, your family, your friends and your important business contacts later this week. 

A quote from Evan Esar

"Character is what you have left when you've lost everything you can lose."